New research suggests SMBs don’t know what type of broadband they have yet plan on becoming more digital
Nearly two-fifths of SMBs don’t know what their maximum broadband speed is and seven-tenths don’t know how much data they consume each month, according to a survey of decision makers by Virgin Media Business (VMB).
However just over half of respondents have problems with slow broadband that hampers their business and two thirds claim they will use more digital technology by 2020. This could be a larger online presence, greater use of social media, online ordering or online customer service capabilities.
Lack of awareness
“These findings echo our own research which suggests 72 percent of small businesses expect to increase their use of digital services over the next five years – yet many still struggle with slow and unreliable broadband connections,” said John Allan, national chairman for the Federation of Small Businesses.
“Too often superfast broadband speeds are not available to the small businesses that need them. Clearly small businesses are facing challenges in their bid to understand and embrace digital opportunities.”
Communications regulator Ofcom says 83 percent of small business believe high quality connectivity is essential for their business to function, and although the majority say they are well-served by the market, some have concerns about speeds, coverage, and quality of service and the choice of providers.
Ofcom has signed up the three biggest providers of business broadband, BT, Virgin Media and TalkTalk, to a new code of conduct that will allow SMBs leave their broadband provider if they do not consistently receive the upload and download speeds they are promised.
The watchdog also wants the government to set explicit targets for SMB superfast broadband coverage. In June 2014, Ofcom said 75 percent of all UK properties had access to fibre, compared to just 56 percent of SMBs, and that when the existing 95 percent coverage target is met, around 18 percent of small businesses will be left out.
Many fibre deployments, including those part-funded by the government, are skipping business parks and Broadband Delivery UK (BDUK) is prevented from intervening in urban areas by European regulations. This has resulted in the existence of urban ‘not spots’ where fibre coverage is absent because many large businesses opt for leased lines so deployment isn’t economically viable.
Virgin Media is currently embarking on ‘project lightning’, the largest ever expansion of its cable network. The expansion will target areas close to its current footprint and places where consumers and businesses register their interest.
The company’s business arm has invited SMBs to sign up so they will be covered by the expansion, with research suggesting 49 percent of firms would be willing to work with other local businesses to ask for faster speeds.
“Reliable, high-speed internet can make the difference between thriving and merely surviving for the UK’s five million small and medium sized businesses,” claimed Peter Kelly, managing director of VMB. “As more and more of daily life shifts online, their need for fast connections will grow – but those frustrated with their current provider need not suffer in silence.”
However Virgin Media’s commitment to businesses does not extend to providing competitors with wholesale access to its network, telling Ofcom this would increase prices and damage service quality and saying it would not welcome any intervention that might impede its £3bn expansion plans.
Article originally appeared in Tech Week Europe on 15 July 2015.