Research: UK £9bn superfast broadband boost

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Local businesses in areas covered by the UK Government’s rollout of superfast broadband have seen a combined £9 billion (€10.05bn) increase in turnover since the boost to their broadband speed, new figures have revealed.

The report, The Evaluation of the Economic Impact and Public Value of the Superfast Broadband Programme, is an independent assessment of the impact the rollout has had in its first years (2012-2016). Key findings from the report include:

  • £9 billion surge in turnover for businesses benefitting from the faster connections now available
  • £690 million net increase in Gross Value Added to the UK economy
  • A reduction of almost 9000 individuals claiming jobseekers allowance, as well as a reduction in long term claimants by 2,500 in programme areas, accompanied by the creation of 49,000 local jobs
  • Programme has delivered £12.28 benefit for businesses for every £1 invested by the Government and local authorities
  • Strong indication that high take up rates of Government’s superfast programme have encouraged telecommunications industry to expand their own commercial broadband projects.

“Our rollout of superfast broadband across the UK has been the most challenging infrastructure project in a generation, but is one of our greatest successes,” declared Minister for Digital, Margot James. “We are reaching thousands more homes and businesses every week, that can now reap the clear and tangible benefits that superfast broadband provides. We are helping to ensure the downfall of the digital divide.”

New figures out today also show that around 5 million homes and businesses who would have been stuck in the digital slow lane now have access to superfast broadband. The Government’s rollout of superfast broadband to those areas deemed ‘commercially un-viable’” has helped take nationwide coverage to 95.39 per cent.

Take-up of the new technology in areas benefiting from the Government programme is now running at 45 per cent – more than double the expected rate. As a result of the contracts put in place by Government, those companies rolling out superfast broadband will now return more than £500 million in subsidies to the public purse to be used to reach those locations not yet covered by existing plans.

It is estimated that more than 1 million extra UK homes and businesses will gain access to superfast speeds, taking superfast coverage to 98 per cent of the nation over the next few years.

The Government is introducing a Universal Service Obligation that will mean everyone in the UK has access to fast and affordable broadband by 2020, and has recently set out plans to deliver nationwide gigabit capable (1000Mbps) connectivity by 2033 as part of its modern industrial strategy.

“It is great to see businesses across the UK reaping the benefits of faster broadband speeds and I’m proud of the leading role that Openreach has played in helping to deliver the Government’s rollout of superfast broadband – one of Britain’s great engineering achievements,” commented Openreach CEO Clive Selley. “We’ve also recently introduced a raft of lower wholesale prices to help drive higher take-up of faster fibre services which will help to further fuel the boost to the UK economy.”

The Government’s rollout of superfast technology is an important part of the ongoing digital transformation work designed to make it quicker and easier for citizens to interact with Government online.

The CLA – which represents the UK’s landowners – welcomes the research findings, but urges government to intensify its efforts to bring broadband in rural areas on a par with more urban areas. It also calls for an holistic approach when considering digital connectivity by incorporating 4G mobile connectivity in its plans.

CLA President Tim Breitmeyer, said: “This research vindicates the CLA’s position on the value that superfast broadband can bring to our rural economy. Despite the progress made on the roll-out of superfast broadband, the research also highlights the disparity between broadband in urban areas in comparison to rural areas.”

“Together with broadband, 4G mobile coverage is essential for services in 21st century Britain, but rural areas are not able to participate in the digital revolution as fully as in urban areas.  We want mobile phone operators held to account to deliver universal rural 4G Digital infrastructure which is vital in making rural villages, farms and businesses sustainable by acting as a catalyst for economic growth and job creation.”

The CLA, along with RICS, Mobile UK and the Department for Digital, Culture, Media and Sport, recently issued a joint statement on negotiations linked to the new Electronics Communications Code pledging to work together to improve mobile phone coverage across the countryside.

“Improving mobile phone coverage across the countryside has clear benefits to rural businesses, consumers and mobile operators,” stated Breitmeyer. “It is only by working together that the most meaningful improvements will be delivered. Ofcom’s code of practice should be the blueprint for future negotiations around rental agreements for masts. The CLA is pleased to endorse this as the best way to achieve agreements which deliver both a fair payment to landowners and improved rural mobile coverage.”


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