Despite investment in the UK’s telecoms and broadband infrastructure, reliable coverage and connection speeds in the UK remain haphazard. Accordingly, a report by the FSB has made several recommendations with a view to improving quality of service standards for small firms across the country, writes David Adams
Those of us aged around 40 can remember when broadband was a luxury, and dial-up connections sufficed for everything a business needed to do online. But, today, not having fast broadband – with download speeds of at least 10Mbps as a reasonable starting point – is becoming as harmful for a firm as being without a telephone was in the 1970s.
“There are companies that feel that not having superfast broadband is a threat,” says Sonia Blizzard, Managing Director at Beaming, a small technology company that offers broadband, voice, data and other IT services to businesses.
“Businesses that can get fast broadband benefit because they can do more. Companies with several sites can link them up using VoIP [Voice over Internet Protocol: internet-based telephony]. It gives companies confidence to move data between sites and look at ways of improving efficiency and productivity, perhaps by running some business software in the cloud. It can enable more flexible working, and gives small businesses an opportunity to compete globally.”
The call for more widely available, fast, reliable broadband connectivity has repeatedly been made by the FSB. The Government is spending £1.7 billion to drive a superfast broadband programme that should have covered “at least 95 per cent of the UK” by 2017. But the progress being made is not yet meeting all of the requirements of small businesses.
These calls for improvements are outlined in a report published by the FSB in September, Reassured, Optimised, Transformed: Driving Digital Demand Among Small Businesses. It builds on the FSB’s 2014 discussion paper The Fourth Utility, which set out the importance of broadband and mobile services to small businesses across the UK, and called for more ambitious targets for the delivery of superfast broadband.
The latest report focuses on how to encourage small firms to take advantage of good broadband and telecommunications facilities, and identifies some of the barriers. The obstacles preventing small companies from doing more online are split into three categories: satisfaction with the status quo, when businesses are unsure whether they could or should extend their use of these technologies; the continuing lack of infrastructure; and quality-of-service issues affecting small firms as consumers in the telecoms market.
Perhaps the most striking finding of the research was that only 36 per cent of businesses that could access superfast broadband knew that it was available in their area. Other factors stopping some small companies using these technologies were the perceived costs and risks of trading online, or of using cloud technologies.
The report repeats recommendations in the 2014 study regarding targets for superfast broadband availability for small firms within a new universal service obligation (USO) – with connection speeds of at least 10Mbps rather than the 5Mbps the Government is considering.
It also proposes a new voluntary broadband code of practice for business to address different quality-of-service issues. It calls on Ofcom to consider escalating penalties for providers failing to repair faults within agreed service terms, and to ask providers to adopt a more consistent approach when advertising achievable download/upload speeds, using minimum instead of maximum speeds as a benchmark.
Finally, the report calls for all stakeholders in the telecoms industry to develop and promote easy-to-use tools to help small businesses ask providers the right questions about their needs and rights; and for digital skills training to improve understanding of these technologies and their potential benefits.
“There are improvements that can be driven through regulation or industry commitments, but also there’s a need for small businesses to have a better understanding about their rights and responsibilities,” says Mike Cherry, FSB Policy Director. “The evidence shows that when small businesses have the confidence to engage with this market, they are able to make fuller use of digital technology to grow their business.”
What more can communications providers do? In July, BT announced it was making an additional £129 million available to extend the rollout of superfast broadband. Danny Longbottom, Managing Director for UK SMEs at BT, says it is encouraging small business customers to use fibre network connections where available, and to consider using IP technologies and cloud services. He also points to BT’s work on the Government’s broadband connection voucher scheme: it has distributed more than 7,000 vouchers so far.
BT is happy to work with Ofcom on a new code of conduct that would address issues such as misleading connectivity speed claims, says Mr Longbottom. “I think we are doing a reasonable job, but there’s more all of us can do to make sure businesses understand what they need.”
In February, Virgin Media announced ‘Project Lightning’: spending £3 billion to connect another 4 million homes and businesses in the UK to its network, offering speeds up to 152MBps and claiming the project could stimulate up to £8 billion of economic activity.
However, network expansion “will be prioritised according to demand from households and companies, with a focus on areas closest to Virgin Media’s existing network”.
All the service providers clearly have more work to do and, for many small businesses, an uneven playing-field will exist for some time. The FSB’s hope is that by continuing to raise the issue it will create a momentum that will be hard to ignore, so that one day all small firms will have fit-for-purpose broadband and mobile access, regardless of location.
Exmoor Zoo, in north Devon, employs 26 people and attracts about 50,000 visitors a year. The zoo is only a short drive from the big holiday resorts of Ilfracombe and Barnstaple, but has to rely on a slow internet connection.
“People book tickets online but we have to ask them to give us 24 hours’ notice, in case our internet goes down,” says Lynn Reynolds, Director and Commercial Manager at the zoo. “We also have our website to run, and we have a Facebook page. We’d like to run an online gift shop, but everything’s so slow.” Mobile phone reception is also poor and although Ms Reynolds has looked into using satellite broadband, it doesn’t look as if the service on offer would be reliable.
Ms Reynolds says the zoo has been informed that the earliest date when BT will even consider upgrading the lines between it and its closest local exchange is June 2016. It has offered to install a dedicated line, but has been quoted an unaffordable price of £2,000 per month.
Training and consultancy specialist Dark Matter Composites has contemplated moving to get a better broadband connection more quickly, but when you consider its location this idea seems extraordinary.
The business is based on an industrial estate on the edge of Redbourn in Hertfordshire, next to junction 9 of the M1, and close to commuter town St Albans and both Luton and Stansted airports.
Its premises are actually just a few hundred yards away from the local telephone exchange, but the exchange is among the last to be updated by BT. Virgin Media has cables in the village, but not on the industrial estate.
Uploading videos to the website is particularly challenging. “I do that from my home office, which is also in Redbourn, because there I can access a fibre network,” says Managing Director Rodney Hansen.
Home Leisure Direct sells games room equipment, including pool tables, table tennis tables, arcade machines and jukeboxes, from a showroom on an industrial estate in the village of Elberton, near Bristol.
BT is deciding whether or not to extend its fibre network to the village. “It will take another nine to 10 months for us to get coverage – if we’ve been picked,” says Managing Director Andy Beresford. It’s particularly frustrating for him to have to put up with a connection speed of 0.8MBps at work, because at home, a 15-minute drive away, the speed is 100Mbps.
Mr Beresford says his staff face difficulties when entering information into the Sage Accounting program. “Our 0.8Mbps connection falls over and it will lose all the data loaded over two to three hours. It’s horrific.”
As well as its existing connection, Mr Beresford also has a business contract with EE to provide a 4G connection via a roof antenna, but it struggles to meet the demands of 22 business users.
Active Potential Therapy, a sports therapy clinic in Chippenham, Wiltshire, doesn’t have a great broadband connection, but needs the internet for email and to run its website, says owner Samantha Cox, a sports therapist herself.
The business has been in its current location only for nine months. When Ms Cox sought to install an online booking system, the telecoms company said the system needed a minimum download speed of 7MBps to run it. “When they tested it, they found we had 0.25MBps,” she says.
“In the end, I’ve had to pay for fibre to be put in. Now we’ve got 20MB, which is more than we need, just so we can run a very standard business. But in order to do online booking, it was a must.”
Mike Iles, Director at MOT Models, feels he ought to be able to cope with his company’s IT requirements – before he started running the firm, which has offices in Berkhamsted, Hertfordshire and central London, he had spent 22 years working in IT.
Mr Iles is a generally happy BT customer, and also uses a BT VoIP phone system, which he says is “very reliable”. His main gripe is the jargon that telecoms companies use. “It’s hard to understand – and I’ve got the right background,” he says. “But the technology works.”
David Adams is a freelance business journalist