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UK business leaders: Broadband speed targets should be '1,000 times higher'

Monday, February 29th 2016 by Ellen Branagh

Business leaders have accused the government of “a poverty of ambition” when it comes to UK broadband speeds.

The Institute of Directors (IoD) said despite having the leading internet economy in the G20, download speeds in the UK are “mediocre” and fibre coverage is “woeful”.

The institute said the target for broadband speeds should be 1,000 times higher than the current 10Mbps by 2020, and should instead be 10Gbps by 2030.

In a report titled Ultrafast Britain, it said Britain is lagging behind many European nations when it comes to rolling out fibre cables to provide the fastest broadband connections.

A survey of its members included in the report found that 78% of directors said significantly faster broadband speeds would increase the company’s productivity.

60% thought it would make their business more competitive, and 51% said faster broadband would enable them to offer more flexible working to their staff.

Dan Lewis, senior advisor on infrastructure policy at the IoD and author of the report, said: “Now is the time to set a bold new target for genuinely world-beating broadband.

“We have the leading internet economy in the G20, and yet download speeds are mediocre and the coverage of fibre optic cable is woeful.”

He said the demand for data is already growing “exceptionally fast” and would only accelerate with the arrival of virtual reality and the internet of things.

“But our network is behind the curve. Unfortunately, the government’s current target displays a distinct poverty of ambition.

“We expect them to meet the Universal Service Obligation of 10Mbps by 2020, but only because they’ve set themselves such a low bar.

'Historic copper network'

“Instead of spending money two or three times over on incremental upgrades to the historic copper network, politicians need to look ahead at how we are going to provide the physical infrastructure needed to maintain Britain’s position at the forefront of digital innovation in business.”

The institute branded the government’s Universal Service Obligation a distraction, saying users already enjoy average speeds of 28Mbps, nearly three times that figure.

It said instead, politicians should be trying to futureproof the UK’s digital infrastructure for the huge data demands of consumers and business.

It said a 10Gbps target would be a “step-change” from current speeds but said it was more than possible.

Ofcom’s review of the digital communications market, published last week, stopped short of splitting Openreach from BT, instead announcing an 'overhaul' of the infrastructure company.

The review will see Openreach forced to open up its telegraph poles and ducts to allow rivals to build their own fibre networks, along with tougher requirements to repair faults and install new lines more quickly.

The IoD said a survey of its members showed that only a third who had had interaction with Openreach were happy with the service they had received.

Mr Lewis added: “Ofcom has taken some positive steps forward, and we have seen in other countries that opening up ducts and poles to other providers can lead to a rapid expansion in fibre coverage.

“But BT Group will still be able extract value from competitors paying to use Openreach’s network, so Ofcom must keep a watchful eye on the situation, and consider asking the Competition and Markets Authority to do a full market review if they don’t see significant improvements.”

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