A German court ruled on Thursday that consumers have a right to be compensated in case their internet connection goes down.
The Federal Court of Justice of Germany ruled in favour of a consumer who complained he wasn't able to use his DSL connection for two months in 2008 and 2009. He already received compensation for having to use a mobile phone, but he also wanted to be compensated for the internet outage.
The court ruled that internet access is as important to everyday life as a car. Why a car? Well, German courts routinely compensate car owners after accidents for every day their car is undergoing repairs, unless the menders provide a replacement vehicle. The same logic can now be applied to internet access. The consumer could be forced to change service provider, or use costly mobile internet access instead. In this case, the consumer asked for €50 of damages for every day of the outage.
However, the claim was deemed too high. In car compensation claims, the court usually awards the equivalent of 40 percent of rental costs, so compensation for internet outages should be closer to average DSL access rates, hardly €50 per day.
According to Sueddeutsche.de, the Court's vice president, Woflgang Schlick, pointed out that compensation could only amount to a fraction of the €50-per-day claim.
"It is a very optimistic estimate," Schlick said. It is still unclear how much compensation the court is willing to grant.
The ruling could pave the way to further compensation claims, but it could also force ISPs to change the way they do business. For example, if they are unable to sort out a DSL outage in a day or so, they could be forced to provide alternative internet access, the same way car dealerships hand out replacement motors.
Andrew Ferguson at ThinkBroadband pointed out to TechEye that there are similar structures in place in the UK. "While compensation for cases where someone is without broadband for a period of two months can often be obtained in the UK, a lot of the time it will be dependent on the cause of the problem," Ferguson said. "There is a big difference between total outages and those trying to claim for periods where the service was performing below par but still functional to some extent."
He continued: "In this case it appears that compensation might actually be less than what some UK providers would provide voluntarily, which is to refund the subscription or provide a credit note to that effect. In cases where the outage is just a day or two, then things become more complex.
"If compensation were legislated then the danger is that it would be inflexible and might result in prices increasing as providers build in the costs of compensating people. In the UK we are seeing this partly with the way that Openreach has been pressured to lower the monthly costs of telephone services. The fault investigation can sometimes result in a charge to the consumer if it is believed the consumers' hardware or their extension wiring is to blame."
For business users, Ferguson said, there are already service level agreements available for purchase both for the phone line and for broadband - which will offer better response times to faults and to compensation levels. "These are more useful, not for the compensation, but for the speedier response to faults," Ferguson said. "Broadband is critical to a business - one afternoon without service can cost a lot of money. Therefore it is important to make sure you have alternate methods of accessing the internet; something as simple as an arrangement to allow you to use a neighbouring firm's broadband can help to stay on top of things like customer inquiries."