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Survey Of Businesses Shows Massive Increase in Broadband Use 1 September 03
Business broadband take-up doubles to 40 per cent. as half of UK companies say broadband is critical to their success.

Click Here To Read The Full Survey Results

The British Chambers of Commerce today launches the largest independent survey of business broadband usage ever undertaken in the UK. Sponsored by Oracle and Cisco Systems ‘Business Broadband’ polled 4,000 businesses in the UK from all sectors and company sizes.

Launching its Business Broadband survey, the British Chambers of Commerce announced that the percentage of companies with a broadband Internet connection has doubled from 19 per cent. to 39 per cent. over the last year. One third of those without broadband, (33 per cent.) plan to acquire a connection as soon as it is available, and one in six companies plan to acquire broadband within a year.

Over 60 per cent. of all companies see more effective communication as the biggest benefit of having a broadband connection for their business. Improved business productivity is the next most important benefit, chosen by 46 per cent. of respondents. The survey found that cost savings are a more significant benefit than improved productivity for manufacturers, retailers and distributors: 45 per cent. of all companies cited cost savings as a benefit of a broadband connection.

Commenting on the survey’s headline figures Isabella Moore, President of the British Chambers of Commerce, said, “Broadband is taking hold in Britain. More than half of all respondents, (52 per cent.) believe that broadband is critical for their business to succeed. Even so, far too many businesses are still viewing broadband as just a faster narrowband connection. Government and industry must now focus on ways in which to improve broadband users’ understanding of its full potential.”

An important driver encouraging broadband adoption, (and frustrating companies that cannot readily gain access) is pressure from customers and suppliers to use broadband-enabled applications. Over 60 per cent. of all companies think customers will pressure them within the next five years to conduct business that requires a broadband connection. Nearly half of all companies, (48 per cent.) predict suppliers will exert similar pressure.

Stephen Timms MP, Minister of State for eCommerce and Competitiveness said, “These results are very encouraging. With over 2 million broadband users in the UK it’s role in ebusiness is proving an essential tool in driving economic success for SMEs, especially at local level. This survey clearly shows that broadband is going from strength to strength. With £1 billion to help wire up public services, hospitals and schools, that momentum can only increase.”

Survey trends show that Internet and external email usage has become virtually ubiquitous in the business world. Overall 85 per cent. of companies have a website and of the 14 per cent. that did not the majority plan to get one in the future.

The survey responses also demonstrate that speed – rather than rich content – is seen as the core benefit of a broadband connection by British businesses. Two-thirds of the open comment responses cite speed as a benefit of broadband whilst less than two per cent. mention rich content services such as video conferencing and Internet telephony.

Ian Smith, Senior Vice President and Managing Director, Oracle Corporation Ltd, UK, Ireland and South Africa said, "We are encouraged that more companies across the UK are taking up broadband connections – but it's clear that there are still barriers to be overcome. One such barrier is the lack of understanding about the benefits that can be achieved by taking advantage of the applications that broadband makes accessible to smaller organisations. This survey enables us to better understand those barriers and work with the business community to overcome them."

Duncan Mitchell, Vice President and Managing Director, Cisco Systems UK & Ireland said, "While the report illustrates that high-speed connectivity is delivering the most immediate advantages, the richer content of higher bandwidth applications and services, and a variety of solutions to help drive operational efficiencies represent the next logical step for the SME sector. This is especially true in the area of business productivity, and particularly when linked to process change."

Remote working
An example of the benefits brought to business by broadband-enabled connectivity was demonstrated in the survey’s findings as 53 per cent. of businesses now report that on average their staff work from more than one location for at least one day a week. However, in over half of these companies the share of employees working remotely is 10 per cent. or less. Meanwhile 11 per cent. of companies report that more than half of their employees work at more than one location for at least one day a week. The construction and professional services sectors have the highest share of staff working in multiple locations each week: 22 per cent. of construction companies say that more than half of their staff work at more than one location for an average of one day a week or more, as do 17 per cent. of professional services companies.

Although high prices are often mentioned as a major barrier to uptake, only 17 per cent. of non-users say they are not connected because it was too expensive. This is down significantly from last year’s survey, where almost two-fifths (38.5 per cent.) listed expense as a reason they did not use broadband. Another barrier down significantly from last year’s survey was lack of information: 14 per cent. said they did not use broadband because they did not know enough about it, down from 30 per cent. in 2002.

Notes
1. Business Broadband was devised in consultation with Matters of Fact, an independent research company and carried out in June and July 2003. Local Chambers of Commerce in eleven regions across the UK (not including London) distributed the survey to their members via printed questionnaire. A link to an online version of the questionnaire was printed at the top of each copy to allow respondents to send their responses electronically if preferred. A total of 3,973 responses, including 197 online responses, were received from businesses of all sizes and sectors. The results are not weighted by company size.

2. The majority of respondents, (56.4 per cent.) are micro companies employing between one and 19 people; 8.6 per cent. of businesses are sole traders and 18.2 per cent. of businesses employed between 20 and 49 people. The majority, 83.2 per cent., of respondents belong to the “small companies” sector, officially those who employ fewer than 50 people. 13.3 per cent. of businesses are “medium sized”, employing between 50 and 249 people, while only 3.5 per cent. of respondents are “large companies”, defined as those employing more than 250 people.

3. The composition of the sample that responded to the survey mirrors the cross-section of the members of Chambers of Commerce. Among the full members of Accredited Chambers in the UK:
 83.8 per cent. employ fewer than 50 people, (53.8 per cent. employ less than 10 people while 30.0 per cent. employ between 10 and 50);
12.5 per cent. are medium sized companies; and
3.7 per cent. are large companies.

4. Nearly three-quarters of respondents, (73.7 per cent.) are in the services sector. Almost a fifth of respondents, (18.7 per cent.) are manufacturers. The remainder was comprised of companies in the construction sector, (6.2 per cent.) or primary production, (1.4 per cent.).

5. Professional services was the most common category of business activity, with almost a third, (27.0 per cent.) falling into this category; 11.3 per cent. of businesses responding to the survey are manufacturers of investment goods. 7.4 per cent. are manufacturers of consumer goods. Other relatively common sectors are “other services” (20.1 per cent.), retail/wholesale (8.1 per cent.) and construction (6.2 per cent.).

6. As a percentage of total respondents, (including broadband and non-broadband users), the most common type of connection is ADSL (25.7 per cent.), followed by high speed leased line (5.1 per cent.) and cable (4.8 per cent.). Satellite and wireless broadband are used by 1.2 per cent. and 1.0 per cent. respectively and only 0.4 per cent. of companies had 3G/2.5G mobile phone connections. A further 3.0 per cent. of businesses are not sure what type of broadband connection they use. Larger companies show a greater tendency to use high-speed leased lines than do smaller companies.

7. Comparing this with other methods of accessing the Internet, dial-up is the most popular method (35.7 per cent. of all respondents), followed by ISDN (29.0 per cent.). A further 2.4 per cent. of businesses are not sure what type of slow connection their business use, while 1.4 per cent. of respondents have no Internet connection at all. A third of non-users (32.5 per cent.) plan to acquire a connection as soon as it is available, while one in six companies plan to acquire broadband within a year; 35 per cent. of non-broadband users have no definite plans to acquire a broadband connection, though less than 2 per cent. say that they will never acquire a broadband connection.

8. Oracle is a registered trademark of Oracle Corporation and/or its affiliates. Other names may be trademarks of their respective owners. Oracle is the world’s largest independent software company. For further details, please visit: http://www.oracle.com

9. Cisco is a registered trademark of Cisco Systems Ltd. and/or its affiliates. Other names may be trademarks of their respective owners. For further details, please visit: http://www.cisco.com