Those of us that work in the telecoms industry, and other areas of high tech, often take internet connectivity for granted. But when we stop and think about it, it becomes apparent how important it really is – you only have to experience a brief internet outage to drive you crazy.
Time and time again we hear about how the vital internet is to our economy. Reports from successive governments and international bodies like the ITU and OECD offer numerous statistics on the contribution that “digital businesses” make to gross domestic product for their host countries. One such example comes from research by McKinsey & Company, who found that the internet accounted for 3.4% of gross domestic product (GDP) in 13 countries studied in 2011 (6% of GDP in the UK), and 21% of GDP growth in the five years preceding 2011 in mature (most developed) countries.
Unfortunately there are countless businesses that still struggle to gain access to even the most rudimentary broadband access. Today’s burgeoning digital economy is characterised by a growing tract of innovative, digitally-centred businesses - entertainment content producers, design agencies, graphic artists, news services and so on. Crucially, these digital companies require connection speeds between the several 10s and the low 100s of Megabits per second.
As start-ups, they fall into the small to medium business category, and they account for 90% of businesses and more than 50% of employment worldwide. Despite their prevalence, there are a notable number of ‘horror stories’ from small businesses complaining that it has taken 12 months or more to get connected. And when they are eventually connected, they’re often only provisioned on the basis of locally available bandwidth, rather than what’s required.
Why is this happening? Simply put, the economics of broadband deployment for businesses are seriously skewed in favour of large enterprises. Or put another way, to connect hundreds and thousands of SMBs with decent broadband connections costs too much and the returns are too little or long to be of any real value to most incumbent ISPs.
In our new white paper, “Enabling the next generation of digital businesses”, we investigate these business cases in detail, and explore how a new breed of dynamic ISPs can use new technologies to dramatically shift their business models to provide a broader portfolio of services to a broader base of customers. I’d love to hear your feedback.