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Small businesses will need superfast broadband 'in the next five years'

Thursday, September 3rd 2015 by Phil Wilkinson-Jones

All small businesses will need access to superfast broadband within the next five years, according to the government’s leading advisory group on broadband.

The Broadband Stakeholder Group (BSG) yesterday published a report on the current and future connectivity requirements of small businesses.

It found that median downstream demand for small businesses will rise from 5Mbps in 2015 to 8.1Mbps in 2025.

The report said that while the figure may appear low, “it is important to remember that over 90% of the firms have between 0-4 employees, putting the 5Mbps estimate in line with industry rules of thumb of under 1Mbps per employee”.

Demand among the heaviest internet users will rise from 12.9Mbps to 41.1Mbps.

The report, produced by media and telecoms consultancy Communications Chambers, found the needs of small businesses vary, perhaps unsurprisingly, depending on their sector and number of employees.

A one-person food manufacturer will need only 6Mbps in 2025 while a 49-person software business will require 193Mbps, the report said.

It also found that upload demand from small businesses is putting increasing strain on current technologies, with 50% of small business premises exceeding the 1Mbps upload limit of standard broadband.

The greatest impact on bandwidth is large file transfers, not video calls or streaming, according to the report.

'Constrained'

Matthew Evans, CEO of the Broadband Stakeholder Group, said: “This report greatly adds to our understanding of small businesses' connectivity requirements.

“Although standard broadband is adequate for most firms, some firms are already constrained.

“All small businesses will need access to superfast speeds in the next five years, and large numbers will soon need the ultrafast speeds that the government committed to delivering in the recent Productivity Plan.”

The BSG is calling on the government to work with industry to ensure all small businesses have access to superfast broadband and continue to drive down the cost of deploying ultrafast networks.

It also wants the government to gather evidence on the productivity gains of companies that have been awarded grants under the connection voucher scheme.

The government announced today that 40,000 businesses had taken advantage of the scheme, which awards up to £3,000 towards the cost of installing superfast broadband.

Digital Minister Ed Vaizey called on businesses to act quickly while there are still funds remaining.

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