Post Office UK: Non-liners miss out on GBP 4.5 billion savings per year

Families with broadband can save GBP 70 per month through online access to cheaper household goods and services, according to new research from the Post Office. Those who are online paint a picture of a ‘broad-bound’ society as 96 per cent consider internet access to be a lifestyle necessity they could not live without.

Yet one third of UK households are missing out on these savings, and the wider benefits, because they are still not online. A total of almost GBP 4.5 billion of potential savings are being missed by non-web users each year, in what is a worrying effect of a deepening digital exclusion.

Broadband in the Home: An Analysis of the Financial Costs and Benefits was commissioned by Post Office Telecoms to calculate, for the first time, the financial impact of the UK’s digital divide. Fear of the initial expense of getting a PC and internet connection , or fear of online fraud , is actually deepening the digital divide amongst those who could stand to benefit most from getting online.

Many non-liners still consider broadband a luxury they cannot afford, yet this report provides strong evidence to show:

• PC pays back: The initial outlay of buying a computer and getting set up online can be paid off through online savings within 18 months for the majority of households (80 per cent).
• Average saving of £840 per year: Typical savings made through online shopping total £840 per year for the average UK household, across a broad range of categories include utility bills, clothing, travel and home entertainment*.
• A wider investment: Internet access opens doors to equally important social benefits from employment and education, to access to public services and communication tools. For example, jobs that use computers are typically better paid, while the rise of email, instant messaging and social networking means non-liners are at increasing risk of social, as well as digital, exclusion.

One year on from the launch of its broadband service, this research will inform the Post Office’s continuing work to get the digitally excluded online by improving accessibility and transparency. For example, the Post Office is the only broadband provider to offer a flat rate for customers who prefer to pre-pay in cash rather than by direct debit. There is high demand for this: 45 per cent of Post Office broadband customers currently pay in cash.

Martin Moran, Post Office head of telecoms, said: "The 9 million UK households that still don’t have an internet connection are missing out on huge savings. Many have the false impression that broadband is a luxury item but we are seeing how increasingly it is actually a money-saving utility – critical in times of economic uncertainty."

"Many of the barriers to getting the digitally excluded online are exaggerated perceptions of costs or fear of online fraud. At the Post Office® we are continuing to play a role in making it easier for these people to get online. 84 per cent of our customers are new to broadband and half of these are completely new to the internet."

-Ends-

For more information please contact:

Debbie Howard or Helen Searle
Blue Rubicon
[email protected]
or
Hayley Fowell
Royal Mail Press Office
[email protected]

Notes to editors
*Top 10 online saver categories (based on average percentage savings available):
1. Telephone bill – save 30%
2. Holidays – save 16%
3. Home entertainment (TVs, PCs, HiFi’s etc) – save 15%
4. Photographic equipment – save 15%
5. Books – save 14%
6. Insurance – save 10%
7. Clothes – save 8%
8. Cars – save 7%
9. Utilities and fuel bills – save 6%
10. Mortgages – save 6%

The report, Broadband in the Home: An Analysis of the Financial Costs and Benefits, was carried out by SQW Consulting, specialists in economic and social development, for the Post Office. All figures were taken from the report unless otherwise stated.

Savings were calculated according to income bracket and the report shows that the highest earners save the most online, averaging £148 per month. The lowest earners were still saving £23 per month – a comparable proportion of their overall spend.

The Post Office and Broadband Accessibility
The Post office continues to work hard to deliver a package that maximises accessibility and transparency for consumers. Specific benefits include:
• A flat rate across the UK with no additional or hidden charges for rural areas
• No introductory offers that increase dramatically after an initial period – our advertised rate is the one you will pay throughout your contract
• Minimum contract of 12 months (rather than 18 or 24)
• Cash payment facility for those who prefer to or need to pay in cash
• No fee or penalty for those who pay in cash – simply pay your tariff with no added extras