London’s small and medium businesses (SMBs) are making £28 billion a year less than they should thanks to slow and unreliable workplace broadband connectivity, new research shows.
High costs, along with the complexity of securing reliable services, make the cost of fast and dependable connectivity prohibitive for many firms, according to analysis from G.Network.
This, the company said, leaves many SMBs at a major disadvantage in terms of productivity, innovation, and competitiveness.
"Digital connectivity is at the heart of London’s economy, but despite extensive availability the SMEs we spoke to for the research are still suffering because connections are too costly and complicated," said Kevin Murphy, CEO of G.Network.
"As an SME ourselves, we understand the challenges they’re facing, and we’re determined to put an end to slow internet speeds."
Working with Censuswide and Development Economics, researchers surveyed senior leaders and business owners at the capital’s SMBs, with the results used in conjunction with ONS data to establish the overall economic impact on revenue.
The study found broadband issues have negatively affected productivity for a quarter of all employees over the last three months, leading to an estimated annual lost output of £5.34 billion Gross Value Added (GVA).
More than half of senior leaders and business owners said they'd considered moving office locations to get better access to faster and more reliable internet services, with four-in-ten stating they can’t serve clients in the way they’d like due to connectivity problems.
A quarter admitted that problems with slow or unreliable broadband have caused them to lose out on business. Similarly, almost half (47%) of business owners and senior leaders said employee productivity is often undermined by poor connectivity.
How improved broadband connectivity can solve SMB problems
SMBs identified quicker response times to clients and customers as two of the key benefits they could reap from improved connectivity.
Looking ahead, said G.Network, the productivity gap experienced by SMBs is only likely to get worse, with poor connectivity compromising their ability to leverage emerging technologies and remain competitive in an increasingly digital economy.
"London’s SMEs play a key role in powering growth and productivity in the capital," commented John Dickie, CEO of London business advocacy group BusinessLDN.
"This important research from G.Network not only underlines the connectivity challenges that businesses in the capital are facing, but also shines a light on the fantastic growth opportunity that lies ahead, for London and the wider UK, should access to fast and reliable broadband be improved for the city’s SMEs."
