Government 'playing it safe' with broadband

A pledge by Labour ministers to provide universal access to 2Mbps broadband by 2012 lets down small businesses and shows the government is “stuck in a time-warp.”

Although these speed-related charges against the commitment in Lord Carter's Digital Britain report are not new, they are no longer only being made by opposition MPs.

The Federation of Small Businesses said that one third of its 215,000 firms already run 2Mbps broadband, yet still find it too slow for performing basic activities online.

Like all of the UK’s small businesses, which derive as much as half of their turnover online, these firms needed broadband for emailing, marketing, buying and selling.

But John Wright, national chairman of the FSB, said the broadband speed which the state wants to impose nationally has already made these straightforward tasks “time consuming.”

“The Federation of Small Businesses welcomes the government's commitment to ensure universal access to fast broadband, but warns the expected 2mbps by 2012 lacks ambition and shows the UK is in a time-warp.”

He added that by 2012, £1 in every £5 will come from online commerce, but stressed that small firms in the UK will only be able to compete if ministers take bolder action.

Mark Seemann, a serial IT entrepreneur, agreed: “The recent government plans to increase the spread of broadband speeds in Britain do not go anywhere near far enough.

“The government plan is essentially to ‘tinker’ with the broadband speed rather than solving the underlying issue. The fact is that the UK is using old technology - its copper infrastructure - and this desperately needs to be upgraded to fibre optic in order to satisfy businesses requirements now and into the future.”

When asked by the FSB, six out of ten small businesses said they would ideally like the universal access commitment to be stepped up to 8mbps, as a minimum speed requirement.

Mr Seemann, a director of Genesis Communications, a web services firm, said: “With copper infrastructure the broadband will not push much past 50MB – even with the latest broadband technology - but if the underlying infrastructure was changed to fibre optic - the speeds today could be 100MB per customer rising to 1000MB.

“This would allow the most advanced business applications - such as high definition video conferencing and streaming complex software over the web - two things that are impossible with today's broadband technology.”

Intellect welcomed the universal broadband commitment, but reminded of the need for backhaul networks to be continually enhanced to cater for extra traffic thanks to the upgraded access networks.

The high-tech trade body also conceded that its vision of half of the UK’s homes running ‘superfast’ broadband, ideally extended nationwide within seven years, now looked overoptimistic.

In part, this is because 42 per cent of the nation’s rural households are in internet ‘not spots’ and are therefore currently unable to achieve the 2Mbps standard proposed, according to the Country Land and Business Association.

The association says about a quarter of rural businesses will see their trading severely hampered over the coming years because of the state’s failure to commit to high-speed broadband in the countryside, the Daily Telegraph reported.

Intellect explained: “There are encouraging signs that by 2012 about 40% of the population will be connected by new fibre and hybrid fibre access networks, but it may be another decade before these higher capacity access networks will be enjoyed by all and even then not without external financial stimulus.”

Yet John Higgins, the group’s director-general, stressed: “Nothing is ever perfect, but anyone who wants to knock this in the future should put something better on the table first.”

Although industry could help, Mr Seemann argued that was a task for government: “Turbulent times need brave and drastic action and the government currently is ‘playing it safe,’ and the result will be UK businesses coming up short when competing with their overseas competitors.”


28th July 2009

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