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Many businesses are locked into restrictive IT contracts

communication technology
(Image credit: Image source: Shutterstock/violetkaipa)

New technologies may be key to post-Covid recovery, but only if they are flexible enough to allow businesses to innovate and change direction at pace.

According to a new report from Virgin Media O2 Business, many IT service providers are anything but flexible, making it difficult for organizations to bounce back following lockdown.

The report, based on a poll of 250 senior IT decision-makers from UK organizations, states that almost half (44 percent) are locked into lengthy and restrictive contracts and are paying for services they don’t really need. A further third (36 percent) say renegotiating fixed-term contracts is preventing them from operating more flexibly and from making braver decisions for the short term.

In almost half of cases (47 percent), committing to long-term contracts requires “significant” upfront fees which they can’t afford. A further 42 percent consider signing a multi-year contract in today’s business climate as risky.

And while practically all (9 in 10) IT managers believe they can survive the pandemic with new IT investments, most (57 percent) don’t believe their business is agile enough. One of the most important changes they would love to see is to be able to end various contracts without being penalized for it.

“Businesses are crying out for more flexibility, certainty and value to unlock the power of digital technology and bounce back stronger,” said Mike Hallam, Director of Fixed Wholesale at Virgin Media O2 Business.