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Small business how much broadband does it need?
Thursday 03 September 2015 10:01:20 by Andrew Ferguson

Business Size Data from Broadband Stakeholder Group

Just how fast a broadband connection does business need? 10 Mbps? 100 Mbps or Gigabit? Well that is a question the Broadband Stakeholder Group attempts to resolve in a report just published, and the results may surprise or upset some but it is still important for campaigners and decision makers to read the report in detail as even if you do not agree with the conclusions it contains a wealth of useful information.

The report considers both the size and as you can see in terms of number of businesses sole traders are king but also what they do, so a business in the construction industry will have very different needs compared to health or a computer consultancy or even a farm. A key factor and it may be controversial is the idea that they have modelled bandwidth needs based on a business being able to do everything needed, apart from the four busiest minutes of the month.

"The report matches small business premise demand against the broadband technologies currently available. We see that some small businesses are already capacity constrained if they only have access to ADSL or ‘standard broadband’ with upload much more of a constraint than download. By 2025, we see that about 20% small businesses premises, the vast majority of whose needs are currently being met by available next generation FTTC / DOCSIS3.0 technologies, could, if they remained limited to today’s speeds, be constrained by them. The portion of employees constrained in some way would be larger.

Fortunately, by 2025, in addition to the continued development of FTTC and DOCSIS3.0, we also expect to see and DOCSIS 3.1 technologies deployed in much of the country and this would likely meet the demands of all small business premises. Fibre to the premise would clearly provide ample bandwidth, today and into the future, for small businesses."

Extract from Broadband Stakeholder Business Bandwidth Report
Projected Speeds Needed For Business Use

While it is easy enough to pull a single median figure and publish an average headline requirement the question is if the projections are in the ball park do we as a nation need to ensure 100% coverage of speeds that will cope with a 99th percentile bandwidth demand or as the report suggests will islands be sufficient, e.g. ensuring business parks have this sort of availability. If the public pocket is deep enough, or commercial broadband providers can be convinced to invest 100% coverage of all UK premises (business or otherwise) at the 300 Mbps figure by 2025 would be ideal and while that sounds ambitious we are on track to hit around 66% coverage at this speed in 2017/2018, the question just like in 2009 is how far will commercial roll-outs go and what damage this will have on the economy. Who knows it might be more beneficial for the Government to subsidise business relocation than actually install ultrafast for one firm.

Figure 45: Summary downstream bandwidth demand (Mbps)
Percentile 2015 2025
  Prem Emp Prem Emp
Median 5.0 8.0 8.2 18.2
95th 13.0 29.7 41.1 91.3
99th 21.7 47.7 67.5 143.9
Figure 46: Summary upstream bandwidth demand (Mbps)
Percentile 2015 2025
  Prem Emp Prem Emp
Median 1.2 2.7 2.3 4.7
95th 7.2 15.6 36.0 71.1
99th 13.5 25.1 43.8 90.5

The reports author has previously worked in Hong Kong and thus have experience of an urban area where superfast and ultrafast broadband has been widely available for some time and it seems even there in March 2015 43% of business broadband lines purchased were just 10 Mbps plans, where as in the consumer arena the demand for speed appeared higher with just 12% picking such a low speed package.

We know of various studies proclaiming increased house prices and economic benefits for business but an important question that is often overlooked in the rush for good PR headlines is raised by the report "Do increases in bandwidth always have a productivity benefit for a business, or only if its current bandwidth is insufficient?". Or put another way, a business that may now have access to a just superfast connection of 31 Mbps, will it become more productive in a way that improves its bank balance and tax revenues if they upgraded to a 300 Mbps broadband connection?

At the end of the day the report is not saying that providers should not invest in symmetric Gigabit broadband (no matter how its delivered) but is trying to provide some information in a void that is otherwise governed by rumour and gossip. The most important aspect to take from the report is that SME and business broadband usage is far from uniform, in fact we suspect that it may be more diverse than the average household, where the main variable is the number of teenage children and whether people in the home watch TV online.


Posted by csimon about 1 year ago
Yes, I think the only people saying there isn't demand from businesses (and domestic users) are those who don't want to be bothered with providing it. As far as I'm concerned, comms is a utility and should be made available everywhere. Not everyone will need it or take it up but it's an essential for those that do need it. The argument is like debating whether it's beneficial to the country to supply electricity, water, roads, lighting etc to practically everyone, or will 75% do?
Posted by ValueforMoney about 1 year ago
This seems to ignore how cheap the medium is and the potential it offers.
Ok when I pay £10 for a haircut from my local Iraqi(Falluja)barber, he is using FTTC to stream some Middle Eastern music. However my wife pays £80 and the experience includes some photoshop uploads to finalise some 'look'. This needs more.
Posted by TheEulerID about 1 year ago
It is good to see some attempt at an analysis rather than the only gigabit stuff that seems to be as much based on nice round numbers than economic calculations. It's not that there shouldn't be some form of universal provision, but at what level. Beyond that it should be provided at cost or it simply distorts efficient economic use of resources. It's very easy to demand high levels of service when the costs is subsidised by others.
Posted by ValueforMoney about 1 year ago
Anything that might require the exchange of images, including the complex repair of some plumbing or weld needs access to a good upload or live streaming facilities with less .1% packet loss. This is the second BSG study suggesting limits. Why, when the raw material is there to be used?
Posted by TheEulerID about 1 year ago
Also, to those who demand the same service everywhere, we do provide different levels of infrastructure. Some services, like main sewerage and gas and public transport are far from universal (and even water). Even where some are (almost) universal, they aren't provided to the same level; 240v electricity may be provided, but not at the sort of power levels for intensive industry (at least not without a huge bill).
Posted by ValueforMoney about 1 year ago
@TheEulerID - The Ofcom work supporting FLAM showed a per Megabit second cost ( across the network) of circa £5 - hence the 1/2mbit per registered user, translating to a much higher per active user.
This is truly a remarkable achievement of the GEA architecture/design. Why would you wish to limit access to this asset and let it the market decide the parameters?
Posted by ValueforMoney about 1 year ago
@TheEulerID - the use of Gigabits is problematic (e.g. power, joules per bit delivieed) but the sentiment is not in so far as the medium is relatively cheap. So relatively cheap it is scary. If BT wants to turn the pST off by 2025, why not push on with a greater access transition plan?
Posted by Somerset about 1 year ago
CDS meeting online at
Posted by ValueforMoney about 1 year ago
@TheEulerID - your problem is not cost but resource. The clawback model adjustments and underspends for BDUK are an illustration of this and there is more to come.
If BT employed and trained 2,000 apprentices as Fibre access enginees much would be forgiven.
Posted by TheEulerID about 1 year ago

2,000 engineers would not make a massive difference. In any event, a company like BT does not take on large numbers of new employees for short term projects as they will be with them a long time. Given the nature of OR severely limits the potential for revenue increases, adding very large numbers of fulltime employees is a non-starter. Ofcom's whole direction is to reduce the costs of infrastructure, not increase it through adding more staff.
Posted by ZenUser27 about 1 year ago
I like knowing my line is being monitored and it has a financially backed SLA - I also like having critical care and also my own line. You truly do get what you pay for and although my new line is no different to a normal FTTC line it's scalable and uncontended. I do have a cheap £30 backup line but this is purely for backup. I've only used it twice in 4 years

My business wouldn't suffer if I lost all connectivity but it would be an inconvenience which is why I shell out over £200 a month to be online with 2 providers using different backhauls and methods to get me there.
Posted by Somerset about 1 year ago
@VFM - you will know that BT uses large numbers of contractors for the rollout. What is your issue with resource?
Posted by TheEulerID about 1 year ago
@VFM @Somerset

It's important to note that the limits on resource aren't confined to BT. All the contractors to do street works have their own resource constraints to. Even at the general builder level there's a shortage of tradesman so I think the resourcing issues goes byond just one organisation. Most of the contractor companies will have their own issues with training and taking on large numbers of new staff for short term projects.
Posted by ValueforMoney about 1 year ago
@Somerset - it is the probability that all underspends, clawback, etc will not get spent improving the reach of the fibre access network. C30,000 BDUK funded cabs will absorb <£1bn subsidy. There is no real plan or resuource for the rest.
Posted by ValueforMoney about 1 year ago
@WWWombat it is not really a short term project but the begining.
BT has a data transmission network capable of 10Tbps, with 3Tbps enabled, why plan to inhibit access to that resource.
Posted by Somerset about 1 year ago
@VFM - what do you mean by improving reach and link to explain/verify 3/10Tbps enabled please. Also explain 'plan to inhibit access'.

Please show cost of team of people and equipment to unblock ducts for one day in your calculations.
Posted by WWWombat about 1 year ago
Eh? I've not commented on this article, and certainly don't intend commenting on a wildly off-topic resource thing.

As for the BSG document ... not a bad effort. It takes some work to get useful statistics out (the nationwide median isn't one of them), but it gives a great feel.

It does leave out the class of users "home workers" (ie occasionally work from home, rather than the office), and delegates that data back to the previous residential report.

The next obvious report is on mobile data...
Posted by ValueforMoney about 1 year ago
@WWWombat sorry that comment was meant for EulerID.
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