Our use of cookies 
Understanding business broadband contracts
Choosing the right business broadband contract isn’t just about speed or price.
Business broadband contracts are multi-year commitments with complex terms, varying service levels, and expensive early termination clauses, so understanding the fine print is essential.
Our guide to business broadband contracts cuts through the complexity to help you make an informed decision. Here’s what we cover:
- What is a business broadband contract?
- Business broadband contract lengths
- Key terms to understand in your business broadband contract
- Cancelling a business broadband contract
- Choosing the right business broadband contract
What is a business broadband contract?
A business broadband contract is a legally binding agreement between a company and a broadband provider for the supply of internet services.
The contract outlines the broadband service that will be provided, the speed of that service, how long the service will be provided, and how much your business will pay.
The terms of a business broadband contract differ in a few key ways from a home broadband contract:
- Service Level Agreements – Unlike domestic broadband, business broadband contracts include robust guarantees over speed, uptime, and time-to-fix.
- No peak time throttling – Broadband providers promise not to throttle speeds of business customers to manage traffic during peak times.
- Static IP – Business broadband contracts usually include a static IP to enable customers to host servers and websites locally.
- Lower contention – Business services typically have a lower broadband contention ratio, meaning you are sharing broadband infrastructure with fewer nearby properties.
For more information, visit our full guide to business versus residential broadband.
Business broadband contract lengths
Business broadband contracts are typically structured as fixed-term contracts, where you receive a broadband service for an agreed number of months at a fixed monthly price.
Early termination fees on business broadband contracts are expensive, so it’s vital to select the right contract length to suit your needs. Here are the most common options:
12 month fixed term contract
Some providers offer a small business broadband service with a 12-month term for SoGEA and full fibre services. Vodafone business broadband and Virgin Media business broadband are notable examples.
The 12-month business broadband contracts offered by these providers carry an additional monthly cost compared with 24-month alternatives.
24 month fixed term contract
Two years is the standard contract term for most full fibre business broadband deals.
Sky business broadband and BT business broadband only offer 24-month contracts as standard to new customers for their fibre optic business broadband services.
60 month fixed term contract
Five-year business broadband contracts are the standard for leased line business broadband contracts.
Leased line broadband installations require laying a new dedicated fibre optic cable and are therefore very expensive for the broadband providers. Leased line providers typically offer 60-month contracts as standard to recoup these upfront costs over a longer period.
No contract business broadband
No-contract or rolling business broadband contracts are uncommon.
Business broadband providers incur costs to connect new customers, so most broadband contracts are offered for a minimum of 12 months.
The notable exception is Hyperoptic business broadband, which offers a rolling full fibre business broadband contract.
When the fixed term of a standard business broadband contract expires, it usually reverts to a rolling contract, which only requires a 30-day termination notice period.
Key terms to understand in your business broadband contract
This section summarises the most important terms and clauses of a business broadband contract.
Minimum contract term
The minimum contract term is the duration you’ve committed to receiving the broadband service.
An early termination fee typically applies to cancelling the contract before the end of the term. This is usually calculated based on the remaining months.
See above for typical contract lengths of business broadband contracts.
One-off and monthly charges
A business broadband contract will typically include the following charges that apply during the contract term:
- Installation charges – One-time setup fees for installing lines and providing hardware such as your business broadband routers.
- Monthly charges – A fixed monthly fee for each month of the contract term.
Find out more in our full guide to business broadband prices.
Mid-contract price rises
A mid-contract price rise occurs when your broadband provider increases the monthly cost of your service during the contract term.
Business broadband deals are typically advertised with a single monthly cost. However, this can hide a contractual clause allowing your provider to increase this cost partway through your contract.
Here’s an example of a mid-contract price rise clause:
Your monthly charges may increase each year from 2025 on or after 1 April by the Consumer Price Index (CPI) rate of inflation plus up to 3%. For example, if you‘re paying £30 per month, and the January 2024 CPI figure is 2%, we may apply an increase of up to 5%. At 5%, your monthly price would increase to £31.50 after 1 April 2025.
The best business broadband providers advertise business broadband contracts with no automatic price rises.
Service promises and SLAs
A business broadband contract will always outline your provider’s obligations in the event of a connection problem.
Basic business broadband contracts typically specify a timeframe for the provider to fix any faults. However, these contracts often do not stipulate penalties or consequences if the provider fails to meet these targets.
If a reliable broadband connection is critical for your business, we recommend enhancing your broadband contract with a Service Level Agreements (SLAs). An SLA stipulates specific performance metrics, such as:
- Time to restore service – The maximum time to get back online in case of a fault.
- Uptime percentage – The percentage of time the service is expected to be operational.
- Network latency – The time it takes for data to travel between its source and destination.
A Service Level Agreement also provides for compensation in the event of service failure. Find out more in our guide to business broadband SLAs.
Speed and bandwidth
A business broadband contract will define the speed of your business broadband connection.
This is the maximum amount of data that can be transferred over your internet connection per second, measured in Mbps (megabits per second) or Gbps (gigabits per second).
The following types of speed are typically included in a business broadband contract:
- Headline estimated speed – Broadband deals typically quote an ‘estimated’ or ‘average’ download and upload speed. This speed reflects the type of broadband connection but is not a contractual guarantee of the speed you’ll receive.
- Minimum guaranteed download speed – Some business broadband contracts will specify a minimum guaranteed speed for their packages. If your broadband service fails to meet the minimum speed stated in your contract, you may be able to terminate the contract without paying an exit fee.
Find out more in our full guide to business broadband speeds.
Fair usage policies
A fair usage policy is a clause in your broadband contract that allows the provider to restrict or manage your internet use if you are consuming an unreasonable amount of data or causing disruption to the network.
- Fair usage policies may apply to:
- Excessive data downloads/uploads
- Continuous heavy use at peak times
- Use of bandwidth-intensive services
Premium business broadband contracts typically do not include a fair usage policy.
Renewal clauses
A renewal clause in a business broadband contract outlines what happens once the minimum contract term ends.
The two most common types of renewal clauses are:
- Automatic fixed renewal – Your contract renews for another full fixed term (e.g. another 12 or 24 months) unless you give notice.
- Rolling monthly renewal – After the fixed term, the contract switches to a monthly rolling basis, cancellable with 30 days’ notice.
Ofcom requires that broadband providers notify business customers as their fixed term concludes. This communication must include advice on the best annual tariffs the provider offers.
Setting reminders before your contract end date is advisable to review your options and avoid being locked into an automatic renewal.
Cancelling a business broadband contract
Businesses must terminate their business broadband contract when switching business broadband providers or moving premises.
Here are the typical consequences of cancelling a business broadband contract:
- Early termination fee – If you cancel your business broadband contract during the agreed fixed term, you will likely incur an early termination fee. Termination fees are usually a significant portion of all your remaining contracted charges.
- Return of router and other equipment – Most business broadband providers require that routers and other equipment be returned. They will send your business a pre-paid envelope for this purpose. A “non-return” fee may be charged if the equipment is not returned.
Your broadband will cease on your requested termination date, and your provider will send a final bill to your business.
Choosing the right business broadband contract
Choosing the right broadband contract is crucial for securing better terms, lower costs, and the appropriate service level.
Here are the top three things to consider when choosing between business broadband contracts:
Understand your broadband requirements
Understanding your business’s broadband requirements is key to finding the right contract.
Form clear expectations regarding required bandwidth (number of users), speed, uptime guarantees, and desired contract length.
Compare business broadband deals
The best business broadband deals are time-limited offers made by providers to attract new customers.
Our business broadband experts can assist you in quickly discovering the best business broadband deals currently available in the market. Visit our compare business broadband deals page to find out more.
Contract add-ons
The cheapest business broadband deals often occur when multiple products are bundled into a single contract.
Here are the top three most popular business broadband contract add-ons to consider:
Back to blog
