Digital Connectivity: more important than ever

Digital Connectivity
Covid-19 has highlighted the crucial need for world-leading digital connectivity across the UK. Not only is digital connectivity underpinning economic and social inclusion, widespread home working and technology adoption today—it will drive the economic recovery going forward.

The Government vision is for gigabit-capable connectivity to every home and business by 2025 and 5G to the majority of the UK by 2027. This vision is ambitious – and it is achievable – but only with a concerted effort.
 
The Made Smarter Review[1] found that slow internet connection speeds are a key barrier to industrial digital adoption, particularly amongst SMEs. Cluttons own research found 81% commercial building tenants deem good connectivity to be vital for business performance.[2]
As well as improving the performance of low-productivity businesses, digital connectivity can play a role in addressing wider societal issues such as cutting carbon emissions by reducing the need to commute. Nationwide gigabit-capable connectivity could allow 400,000 more people to work from home, giving greater flexibility in where they live. 
 
That means hundreds of thousands more people could move to rural areas, reducing pressure on transport networks and urban housing. 

Rollout will require significant investment (it has been estimated to cost over £33bn). Most of this will come from the private sector. But the hardest-to-reach areas of the UK are commercially unviable — for rural Britain to access gigabit-capable networks will take public investment. 
 
At Spring Budget, a record £5 billion Government investment was confirmed. We believe a significant proportion of this should be reserved for the hardest-to-reach 20% premises in the UK. 
Government can also help create the right conditions for investment in ‘potentially competitive’ or ‘missing middle’ areas of the UK, such as villages, business parks and small market towns. 
 
To achieve this, Government policy must positively affect the business case for investment. This includes stimulating business and consumer demand, making it easier for providers to access land and reforming Telecoms business rates.

We manage infrastructure for digital infrastructure providers and mobile operators across the UK, this includes supporting their business rates strategies. At Spring Budget the Government announced a fundamental business rates review. Telecoms business rates reform must cover all digital infrastructure, focusing on the outcome of gigabit speeds and greater reliability. 

Lower business rates bills for providers will leave them with more capital to invest and ultimately speed up nationwide rollout of gigabit-capable connectivity and 5G.

As a real estate consultancy, we support businesses and individuals searching for premises across the UK – and we help ensure those premises enhance live/work experience. It is on behalf of them we support the elimination of exclusivity agreements in new build developments, which can leave consumers with low speeds and expensive broadband.
 
An immigration and skills system that supports the technology sector is also essential. Meeting 2025 and 2027 targets will require a faster pace of deployment than any comparable country, and therefore more engineers and groundworkers. Only a flexible and adaptable immigration system will allow for that.
 
As a nation, we have made significant strides improving the availability of gigabit-capable broadband and supporting commercial 5G rollout. Providing connectivity will help drive the UK’s economic recovery from Covid-19 – this should drive us to be more ambitious still.  
 
Ultimately, connectivity provides economic, social and environmental progress – with the correct policies, regulations and talent in place we can go further, faster.

[1] Made Smarter Review, (2017), led by Jurgen Maier.
[2] Cluttons, The Connectivity Commercial Impact Report (2019).

 

John Gravett
Head of Real Estate Management 
Cluttons LLP

T:      +44 (0) 20 7647 7135 
M:     +44 (0) 7880 748 177 
E:     john.gravett@cluttons.com
 

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