Big step forward – or missed opportunity?

“We can no longer remain silent in the face of mounting evidence that businesses are suffering from poor service standards, ‘not spots’, unreliable connections and a market structure that fails to offer competition and choice.”

That’s what 52 Chambers of Commerce had to say about broadband connectivity just over a year ago. On behalf of 75,000 UK businesses (and the 4.5 million people they employ), they pointed out to the Department of Culture, Media and Sport (DCMS) that: “Unless there is improvement on reliability, speed, coverage and competition, we fear that individual companies’ performances – and UK productivity – will be severely affected.”

They weren’t the only ones complaining about the UK’s poor network connectivity. The Trades Union Congress also piled in, stating that the UK was ranked second last out of all OECD countries for ICT infrastructure. Meanwhile, Ofcom warned that a quarter of the UK’s small businesses – just under 300,000 companies – had poor broadband because they are based on non-residential, industrial parks where average broadband speeds can be glacially slow. 

As one of the richest countries in the world – and a country dubbed by Forbes as the fifth best country for business in 2017 – this was shocking.

So, the launch of a new digital strategy from the DCMS – now under new management – is to be welcomed. It is what many of us have been demanding for years. As John Longworth, the British Chamber of Commerce’s director general, pointed out: “The UK government must set a far more ambitious digital strategy, starting with an immediate action plan to boost mobile and fibre connections for business.”

The question is, is it really that ambitious? 

Lack of depth

There are certainly plenty of positive messages about giving everyone access to the digital skills they need, making the UK the best place to start and grow a digital business, unlocking the power of data in the UK economy, and security. If that means the government will finally take cybersecurity seriously, that’s something to celebrate. Importantly, it also claims that broadband and mobile should be treated as the fourth utility so that everyone benefits from improved connectivity. 

All of this is to be applauded. But dig into the weeds a bit further and something doesn’t quite add up. For all the statistics, and partners, and research cited in the strategy, there’s also this: “The digital strategy is therefore a first statement in an ongoing conversation between digital businesses and government.”

The worry here is that behind all the sound and fury, there is a lack of depth, direction and drive. This is less a bold statement of intent than an invitation to a talking shop. And gathering the great and good of the ICT industry together to chat through their options is not the same thing as creating a digital economy. 

What’s more, although the document is careful to define what it means by the digital sector and the digital economy, there’s a distinct wooliness about what is meant by a digital business. Whether they regard themselves as digital or not, whether they make pottery mugs or developing predictive modelling, every business in the UK is effectively digital – if not now, then in the very near future. Even the most basic business functions depend on robust – and fast – connectivity.

The reality is that digital training schemes, regional job creation, and even sustainable economic growth simply cannot happen without access to adequate network infrastructure. Remote or rural businesses cannot become digital if the CEO can’t send an email while his marketers are on social media. If firms can’t access business tools in the cloud, internet services, video-conferencing and other connectivity-dependent, time-saving, and cost-efficient solutions, they will be left behind.

Currently, the UK is severely lacking in the connectivity department – and the new digital strategy doesn’t do enough to overcome this hurdle. For example, having re-confirmed that there will be £1 billion invested into digital connectivity – the government will direct only £400 million of this to broadband. 

Missed opportunity

If you consider the £55.7 billion – and counting – being invested into building HS2, you can’t help but wonder if such a vast amount would better spent on ensuring every town, city and business park in the UK has access to state-of-the-art broadband connectivity. 

The DCMS itself says that, as a country, the UK has to encourage the market towards ubiquitous ultrafast services, but it also has to balance the additional benefits of increasing speed against the costs today of providing the infrastructure. 

The tragedy is that off-the-shelf, 10 Gigabit Ethernet service (GigE) is already being made available to British businesses at competitive and flexible price points. These services promise to provide some of the highest network speeds in the world to most businesses across the country. In fact, 10 GigE can be up to 400 times faster than the government’s minimum definition of superfast broadband (24Mbps). This isn’t a literal pipe-dream – it’s available today.

With a 10 GigE connection, businesses can adopt and run a full suite of modern business tools, as and when they need them. They can converge data, voice, video and application traffic and – depending on the service provider – ensure quality of service, benefit from DDoS protection, and take advantage of flexible bandwidth management. It’s also a guaranteed way of future-proofing the business as more technology advancements come to the fore.

The DCMS’s tells us that the volume of global internet traffic in 2020 will be 95 times that of 2005. Connected devices will outnumber the global population by nearly seven to one and, in the UK, fixed internet traffic will double every two years. Just increasing broadband speeds could add £17 billion to UK output by 2024. 

But despite discussing full fibre and ultra-speed technologies (although notably not 10 GigE) in their future plans, the closest thing to a commitment on connectivity and infrastructure is a new broadband Universal Service Obligation (USO) that will be in place by 2020.

This is a huge missed opportunity. We need high-speed connectivity embedded in our business culture now. The inability to modernise Britain’s network infrastructure is not just a matter of being bottom of broadband league tables. It’s a major bottleneck to the progress of business and our increasingly digital economy.

Lee Wade, CEO, Exponential-e
Image source: Shutterstock/violetkaipa