FSB calls for major reforms to UK broadband market

Federation of Small Businesses calls for more ambitious government broadband targets, saying slow progress is hampering growth

The Federation of Small Businesses (FSB) has warned that current government targets for the roll-out of superfast broadband will not allow its 'digital by default' strategy to bear fruit, and urged a more ambitious approach.

Citing figures that suggest up to 45,000 UK firms are still using dial-up connections and many more are struggling with speeds lower than 2Mbps, the FSB said that, while the residential market is benefiting from growth in superfast connections, business users are being left out.

It claims current target speeds of 24Mbps for 95% of the population, and 2Mbps for the remaining 5%, would not meet the needs of businesses, which face problems such as an inability to send digital invoices, upload and share large data files, or effectively communicate with clients.

The FSB called for the government to commit to a minimum speed of 10Mbps to all business premises in the UK – regardless of location – by the end of the decade, and a medium- to long-term objective of universal 100Mbps broadband by 2030, which, it says, will still put the UK 10 years behind Denmark, which is targeting 100% 100Mbps coverage by 2020.

“We want to see the UK government show ambition with its broadband targets and put business needs at their centre. Leaving 5% of the population with a 2Mbps connection in 2017 is not good enough,” said FSB national chairman John Allan.

It also called for prioritisation of FTTC and FTTP solutions to business parks and designated enterprise zones, and more acknowledgement of the needs of business users when it comes to superfast broadband, such as symmetrical upload and download speeds and minimum bandwidth levels.

The FSB believes that deep structural reform of the UK broadband market will be needed to achieve these aims, and called for Ofcom to engage the Competition and Markets Authority to assess the current market, and explore options for boosting competition and encouraging the growth of new entrants and altnets.

“We want government to oversee the creation of world-beating digital infrastructure that will enable businesses to grow, innovate and compete in international markets," said Allan.

"This means not only raising download speeds but also upload speeds that are so important and where provision is especially inadequate.  Otherwise firms' growth ambitions will be blunted, while government efforts to get every firm to go ‘Digital by Default' when filing its taxes online will be impossible to achieve."

CityFibre chief executive Greg Mesch commented: "Without access to pure fibre networks, fit for the 21st century, the UK's small businesses will be restricted from accessing a new generation of online and cloud services that offer the functionality and flexibility to help them grow.

"The technology and expertise is available today that allows for a quick, hassle free transformation to gigabit internet speeds. Its essential that this knowledge is utilised in cities and town across the country to ensure the UK remains on a par with other economically advanced nations."

Virgin Media Business director of SMB propositions, Mike Smith, said that a one size fits all approach to broadband provision would be doomed to failure, and said the points that the FSB raised needed to be approached from multiple angles.

"Further collaboration needs to focus on tailored solutions that meet the diverse needs of the UK’s small businesses. Industry has a vital role to play in ensuring these solutions continue to be beneficial to businesses of all sizes, in all areas of the UK," said Smith.

"But it isn't just about managing costs and ensuring the right products are available – it’s also about educating the market, driving adoption and upskilling the UK to make the most of digital, for example 36% of businesses have no web presence and 46% would like to make more use of being online. In doing so, we can drive a stronger marketplace."

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