The Federation of Small Businesses (FSB) has slammed government broadband plans for lacking ambition and being in a "time warp".
FSB national chairman John Wright said more than half of small businesses rely on the internet for up to 50% of their annual turnover. "By 2012, £1 in every £5 will come from online commerce, but if small businesses are to compete, the government must take bolder action."
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He said FSB research showed that a third of SMEs have access to 2Mbps broadband, but around 60% want a minimum broadband speed of 8Mbps. "With Japan leading the way, making high-speed broadband of 90Mbps available to everyone, the FSB urges the government to do more."
Small and medium-sized enterprises (SMEs) make up 97% of the British economy. Many, particularly those in rural areas, still can't get high-speed, low-contention broadband. And there are plenty of "not spots" in urban areas that are waiting for broadband, Wright said.
In its final Digital Britain report, the government committed to providing a 2Mbps universal broadband service by 2012. But Computer Weekly uncovered government plans to tax Wi-Fi and Wi-Max networks, which provide broadband to many rural communities, and possibly to backdate the tax five years. This could put many community rural network out of business, according to some local network operators.
Mark Seemann, development director at Outsourcery, a communications and hosted IT provider with 25,000 customers and over 100,000 business end-users, said the government's plans to increase broadband speeds do not go far enough.
"The aim is essentially to tinker with the broadband speed rather than solve the underlying issue, which is that the UK is using arcane technology. The nation's copper infrastructure desperately needs to be upgraded to fibre optic to satisfy businesses' requirements for today and in the future," he said.
Seemann added that a copper-based broadband infrastructure was unlikely to achieve speeds above 50Mbps. A purely fibre optic infrastructure could reach speeds of 100Mbps per customer, rising to 1GB, he said.
"This would allow customers to run increasingly important applications, such as high-definition videoconferencing, and stream complex software over the internet, which can be problematic with low broadband speeds," he said.