Any New Government Will Be Playing 'Digital' Catch-Up

As the Commons prepares to debate the digital economy bill this afternoon, many experts are warning of the consequences for the British economy if the failings of the digital infrastructure are not tackled immediately!

As cloud computing and Software as a Service (SaaS) rapidly evolve and costs continue to fall making millions of small and medium enterprises (SMEs) reliant on access to high-speed broadband for mission-critical operations daily, this lack of a fast and robust digital infrastructure could have damaging consequences for Britain's competitiveness in the global economy and create long-term effects on the recovery.

The problem will be most acute for the incoming government, which will have to address the issue head on, with wide spread adoption of new technologies or risk Britain falling far behind its American, European and Asian rivals. However, government-backed funding could provide a quick solution.

"With all major parties promising to upgrade Britain's ageing UK copper infrastructure to fibre (to provide faster broadband speeds) the real problem is these plans are already outdated, and by the time Britain has a new fibre infrastructure, British SME's competitiveness will be far behind their European counterparts," said Mark Seemann, product strategy and development director for leading cloud computing company Outsourcery, which services over 10,000 SMEs in the UK.

"What the UK needs is an intermediate solution to tide us over until the full rollout is complete, and there may be a way to deliver this now. The solution is a simple one; the government should set up a Broadband subsidy grant system so that businesses wanting to upgrade their ADSL or Cable connections to the faster fibre private circuits can get BT, Virgin or independent ISPs to provide the more expensive 100mb fibre optic private circuits and claim back 75-90% of the cost of the first year and 50-75% of the cost of the second year. In the first year the one-off installation cost of the fibre circuit is quite high - usually around £9,000 but the monthly rental is lower - around £700 per month.

He continued, "These private circuits do vary in costs depending on where you are in the UK, so a rural private circuit costs and typically more expensive than ones located in major cities as there is more available fibre. There needs to be a scaling system for the subsidies to take this into account. The fact is that most corporates already have access to these connections as they can readily afford the installation and rental costs. It is also true that there is already an abundance of fibre so the core issue is the cost of delivery - something that the government should be able to remedy."

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