UK Business In The Broadband Doldrums

• UK SMEs aren't jumping on the broadband bandwagon
• 80% of UK SMEs fail to see the business benefits of broadband
• Mistral Internet decries lack of government investment

UK businesses are failing to embrace the potential offered by the internet and ecommerce, highlighting a strong scepticism about the internet's marketing and purchasing power.

These are the findings of a MORI survey of small and medium-sized enterprises (SMEs), commissioned by Mistral Internet, the business ISP.

Seven out of ten businesses polled disagreed that instant access to the internet was a critical factor for their business, while 88 per cent cited the web as unimportant for purchasing. Strangely however, 44% say they would use it to market their own products and services.

And when it comes to broadband connectivity, as few as 34 per cent felt that always-on connectivity was an important factor. Even more alarming, again, as many as 70 per cent fail to recognise that Britain is lagging behind in its acceptance of high-speed internet access and that, as a result, the UK's ability to compete in Europe, and globally, may be in jeopardy.

"This is a damning indictment of the Government's Broadband Britain vision, which made significant commitments to ensuring that the UK has the most extensive and competitive broadband market by 2005. This survey reveals how a staggeringly high proportion of UK SMEs still view internet speed and services as peripheral to their core business strategy." says Steve Spink, MD of Mistral Internet.

And what's more, the outlook doesn't look any brighter. When asked about their future IT intentions, almost half - 47% - do not expect to regard broadband connectivity as crucial to their long-term business strategy within the next two years.

77% of UK SMEs think that the internet as they know it is sufficiently speedy to conduct their business electronically and 80% doubt that their businesses would be any more successful if they had faster internet access.

"This survey provides a timely reminder that there is still much to be done when it comes to creating a Broadband Britain," adds Spink. "Not only must we come up to speed with the unbundling process as a whole, but companies - and SMEs in particular - must be educated further as to the competitive implications and the potential business benefits of broadband technologies."

"We call upon the government, in whichever form it comes post-election, to take decisive action towards building a business environment in which broadband is recognised, appreciated and adopted. As Patricia Hewitt herself said earlier this month: 'High speed internet connections will be as important to our economy as modern roads and railways.' It's now time the Government acted to ensure everyone realises that fact."

Technical details

A sample of 200 Managing Directors, Financial Directors and other senior managers of business with an annual turnover of between 1631 million and 163100 million were interviewed by telephone between 19 and 21 March 2001.

Weighting was applied by turnover, region and industry type to make the sample representative of the 135,000 companies with a turnover of 1631 million to 163100 million, as estimated by the DTI.

For the purposes of this document, 'broadband' is defined as faster internet access/always on connectivity to the internet.

Mistral is the premier Internet Service Provider for business connectivity in the UK. Established in 1994, Mistral is a service-based company with its own International network designed from the ground up to carry "business grade" Internet traffic.

Mistral provides a wide range of turnkey solutions for business, government and educational clients including:

• Corporate Internet connectivity
• Virtual Private Networks and wide area networking
• Facilities managed servers and server co-location
• Network firewalls and managed security systems
• E-commerce solution

Mistral also delivers high-speed broadband ADSL connections to UK businesses, with an ISDN back-up option.

Mistral's impressive client list includes Microsoft, Intel, Sun Microsystems, Dow Jones, Sony and Compaq.