The digital economy is a buzzword that gets thrown around under a variety of guises: the web economy, the internet economy, the new economy.
Today, however, as the digitisation of everything continues unabated, the vital importance of digital technology to the economy as a whole is irrefutable. Technology underpins the way in which our country is run, the way in which lives are lived, the way in which businesses function and thrive. While the digital sector itself contributed £118bn to the economy in 2015 alone, a figure set to rise to £200bn by 2025, the value-add it brings to every aspect of UK plc vastly exceeds purely financial calculations.
A need for true transformation
Imagine, then, what the future could hold if the digital economy was to be fully realised – if we achieved total connectivity for every business and every citizen. It gives a completely new meaning to the term ‘transformation’, something that’s overused in today’s economy and often leads to rather underwhelming conclusions.
For starters, it could rejuvenate local economies across the country by enabling the rebirth of the local SME. Many residents of the UK’s biggest cities are being forced to pay through the nose for a frankly substandard quality of life, because these are where the employment opportunities currently lie. A digitally-enabled Britain means the chance to set up shop anywhere, at a fraction of the cost, with a better work/life balance and the chance for a healthier, happier workforce – which, by the way, also means a more productive workforce.
It can certainly be argued that many SMEs operate in a more efficient way than corporate behemoths – and are thus better for the economy – given the culture of ‘short-termism’ and quarterly earnings cycles that has crept into the upper echelons of the private sector. This culture is a barrier to equality, progression and long-term sustainable development; the digitally-driven future gives us the chance to fundamentally change the way we operate our businesses.
Creating jobs and opportunity in local communities means there’s far greater chance of keeping skills within the area, breaking with decades of the regional talent drain to the UK’s main commercial hubs. Mobility, in its many guises, is a positive thing, but it’s not really a reality for the majority of UK citizens right now and, besides, so often people leave communities because they have to. The digital economy of the future finally gives them a choice.
It also means every home has the same ultra-fast connectivity, so for the first time home-working doesn’t involve any compromises. That means less traffic and congestion, which means less pollution, and alongside this, again we reap the rewards of further work/life improvements. This may all sound like unfettered idealism. Yet the reality is, whether we’re talking about the environment, mental well-being, physical health, the productivity crisis, the cost of living, and so on – all are current challenges that cannot go unaddressed. At the very least, digitising our economy gives us the chance to take on all of them together.
Future-proofing the digital economy
So how are we doing on realising this future? Well, despite the undeniable contribution that digital technology is already making to our economy, there are plenty of arguments to suggest that, when it comes to true digital transformation, the UK is actually falling short of its potential. That we are failing to get the basics right, failing to future-proof the digital economy, and ultimately offering up a raw deal for generations to come.
The problem is infrastructure. A game-changing, business-productivity-boosting tech platform developed today in Silicon Roundabout is useless to a home-based worker in the rural north-east who struggles to get basic internet connectivity. A transformative healthcare support app is meaningless to the chronic health condition sufferer in the south-west who can’t stay connected for long enough to complete the download.
Ofcom revealed in its 2017 Connected Nations report that 7% of small businesses don’t have access to ‘decent’ broadband and a further 16% of small businesses lack access to superfast broadband. Scotland, Wales and Northern Ireland have disproportionately lower rates of access to decent and superfast broadband compared to England. Bear in mind that what is currently defined as ‘superfast’ is often not all that fast and the problem quickly becomes clear. The connectivity problems already being seen and experienced across the UK will be vastly exacerbated in years to come because future innovations will place greater, not fewer, demands on our infrastructure.
Currently, just 3% of UK premises have access to full-fibre broadband. We’ll save the debate about what type of fibre is actually fastest and most-reliable for another day – this statistic alone demonstrates how far away we are from realising a true digitally-enabled future. Simply put, we are failing to even keep up with the times, let alone put in place an infrastructure that will support our children and grandchildren.
Deploying nationwide infrastructure is always time-consuming and often expensive. Surely it’s better that we get it right today rather than having to address it yet again in a few years’ time? But herein lies the problem. The bulk of responsibility for delivery sits with a giant organisation not renowned for operational efficiency, for years reliant on government subsidies and preferential treatment, that prioritises immediate shareholder value in the same way as the majority of its FTSE peers. The result is that we’re being given a short-term fix that won’t meet future requirements and that is already leaving large swathes of the nation behind.
The fact of the matter is that the country shouldn’t expect the incumbent provider or the government to do everything that needs to be done. Their activities can be supplemented by a new wave of infrastructure providers, like TrueSpeed, that are delivering the web infrastructure required by businesses up and down the country to fulfil their digital promise.
The digital economy will be better for smaller, local businesses, but it is also better rolled out by smaller, local businesses, which can take to the task more quickly and more efficiently, with an eye to the future rather than on quarterly earnings. Delivering Britain’s digital future requires a level playing-field on which all infrastructure providers can compete fairly. Get this right, and we can digitally transform our economy in a way that’s far more innovative, equitable and effective, in the short-term, and for generations to come.
By Evan Wienburg, CEO, TrueSpeed