Bad mobile signal is hammering UK businesses trying to make money at busy events
New research from Virgin Media O2 and the National Market Traders Federation (NMTF) shows that market traders are losing an estimated £10 million a year in sales as mobile network congestion causes card payments to fail at busy events.
Virgin Media O2 says that outdated net neutrality rules hinder mobile operators from prioritising this business-critical traffic on their networks.
The telecoms company has joined forces with the NMTF, which represents more than 25,000 market traders, to call for reform of government regulation on internet traffic after three quarters (73%) of members surveyed said they’ve lost sales in the last year because of payment issues.
Virgin Media O2 said it is investing £700 million this year as part of its Mobile Transformation Plan to enhance reliability, speed and 4G and 5G mobile coverage nationwide at a time when demand for mobile data has never been greater.
However, with traders often operating in locations which see significant surges in visitors during one-off or irregular events, the network can become particularly busy during peak times.
Six in 10 traders said connectivity for payments is a problem for their business, which causes longer queues (37%), failed transactions (70%) and customers abandoning purchases altogether (47%). One in seven traders have even reported annual losses of over £1,000.
While Virgin Media O2 has the technical capability to prioritise business-critical and time-sensitive apps like payment services, current net neutrality rules – created over a decade ago – hinder it from doing so.
Rules originally designed to protect consumers are stifling innovation by preventing companies from launching services, even when there is a clear demand.
With market traders estimating around seven in 10 payments are now taken by card at events, and a growing number becoming cashless altogether, this problem is only set to rise in the coming years.
£80,000 in lost sales during a single weekend
Ryan Patrick is the Founder of Feast Streat Group, a street food catering company which operates at large-scale events across the UK including in remote locations.
An early adopter of card payments, his food trucks have become completely cashless aligned to customer preference.
“Our operation has been designed so we can serve 30-40 restaurant quality meals every 20 seconds during a rush, so fast and reliable payments are absolutely essential. If a payment takes a few seconds longer it can make all the difference, let alone when a payment fails all together,” he said.
He estimates that mobile congestion cost his business more than £80,000 in lost sales during a single weekend, when it was unable to process hundreds of payments despite being the only trader operating at the event.
As a backup, he previously used a service that could take payments offline, but regularly found that thousands of pounds’ worth of transactions were declined when processed later.
“This hits us massively, but I feel most for the many small traders who cannot afford to lose a single sale. It’s not just traders who lose out, customers don’t want to spend hours in queues or miss out simply because they don’t carry cash. Changing the rules would benefit everyone.”
Jeanie York, Chief Technology Officer at Virgin Media O2, said that if the government is serious about delivering good growth in every postcode, it must remove the barriers holding small businesses back.
“Reforming net neutrality rules could not only help meet this clear demand, but also unlock wider innovation and investment in 5G,” she said.
Earlier this year, a report by Communications Chambers for Virgin Media O2 called for net neutrality rules to be reformed to unlock a new wave of innovation worth hundreds of millions of pounds to the economy, as well as helping unleash new investment in networks, including in advanced 5G.
It argued alongside payment apps for SMEs, other real-world use cases include allowing operators to use customer insights or preferences to prioritise time-sensitive apps such as map-based navigation or requests for taxis outside of major venues, as well as enabling a user to readily prioritise an important video call over other apps using their connection.
Over the next three years, the business is forecasting double digit annual growth in mobile network demand, driven by greater data consumption per customer, increasing numbers of 5G‑enabled devices and greater demand for upload capacity.
