Importance of connectivity in a digital economy
Broadband is now seen by many as the ‘fourth utility’1 alongside mains gas, electricity and water. Users are increasingly demanding a better quality experience from digital networks and the government is working with Ofcom2 to encourage investment in infrastructure to meet user demand. According to Ofcom, the UK needs infrastructure that is high in capacity, reliable, resilient, secure, affordable and fast to support the demand.
The demand for superfast broadband is growing rapidly and both home buyers and businesses are increasingly looking for access to broadband as it is their primary source of connectivity. The government and London’s local authorities are all set to ensure this continues to be enabled by forming Task Force, a team of experts and key individuals3. This dedicated ‘Task Force’ will regularly meet up to determine the most appropriate method of achieving this and ensure that proper planning and management is being carried out as we move into the future.
UK’s broadband infrastructure: the perspective of SME’s
When it comes to meeting the needs of small businesses, as many as 14% of SMEs consider broadband connectivity crucial to their future growth, but according to a report published by the Federation of Small Businesses (FSB) on the state of the UK’s broadband infrastructure, up to 45,000 firms are still on dial-up speeds that are proving to be a barrier for small business growth4. The FSB are calling for ‘fit for purpose’ broadband connectivity for small firms across the UK with a guarantee of advertised speeds, high quality service and symmetry between upload and download seeds.
New plans for ultrafast broadband unveiled
The government’s ambition is that ultrafast broadband of at least 100Mbps should eventually become available to nearly all UK premises through a new Universal Service Obligation. The government is exploring options for extending superfast broadband coverage beyond 95% of the UK through innovative projects, such as the Broadband Delivery (BDUK) programme5, a publicly funded project designed to provide better services to the hardest to reach areas of the UK. The current target is to have a superfast broadband (24Mbit/s) in place by the end of 2017.
SuperConnected Cities Programme
The Department for Business, Innovation and Skills in conjunction with the Department for Culture, Media and Sport are committed to help more SMEs realise the commercial advantages that businesses would reap through faster broadband speeds6. £150 million has been made available to support UK cities to improve digital connectivity in order to make them more attractive to visit, live and do business7.
Through the SuperConnected Cities Programme across the 22 UK cities, the government has provided broadband connection vouchers to thousands of SMEs, public Wi-Fi in over 1000 public buildings and digital projects in some of the leading cities. The connection vouchers scheme allows SMEs in super connected cities to get a grant of up to £3,000 for a faster and better broadband connection. The scheme has so far helped more than 5000 SMEs to get better connectivity and now the government is rolling out the scheme further to possibly double the number of cities involved.
Future broadband benefits, demand and requirements
The Broadband Stakeholder Group (BSG), which is the government’s leading advisory group on broadband, has been working on the needs of SMEs to predict their future broadband needs. In a report published in September, 2015, the BSG stated that SMEs will see median downstream demand rise from 5Mbps in 2015 to just 8.1Mbps by 2025 . Similarly to download speed, upload speed can also be very important for business. The BSG predicts that while median upstream premise demand is currently only 1.2Mbps for small business, and 7.2Mbps for the 95th percentile, it is expected to rise to 2.3Mbps and 36Mbps respectively by 20258.
As far as superfast technologies are concerned, both FTTC and DOCSIS 3.0 meet the needs of virtually all businesses today and will continue to be sufficient for the great majority until 2025. It is hoped that by 2025, next generation technologies such as G.fast and DOCSIS 3.1 are likely to be in place. BT and Virgin have been testing the new technologies, and along with FTTH, it is thought that there will be enough capacity to meet with predicted demand in the roll out areas.
SME benefits and business opportunities
SMEs are crucial to the UK’s economic growth and well-being as they provide nearly half of all private sector employment and a third of private sector turnover. Through significant government and private sector investment across fixed and mobile broadband in recent years, there are significant benefits to be realised if SMEs could be persuaded to make full use of broadband, such as geographic expansion, access to online tools, easier recruitment of staff, simplified customer payments, increased feedback, interaction with customers and more effective marketing. .
Access to high-quality broadband provision is a commercial necessity that plays a crucial part in improving business productivity. Fast broadband is gradually becoming affordable and more available, and there is also a wide choice in capacity. Even though there are still some delays in cabling work and deployment of fibre in the office building premises due to access rights and security clearance from all parties involved (councils, landlords, solicitors and management companies), London businesses are able to enjoy more choices of circuits, reduced costs and shorter contract terms with competitive packages.