Better than nothing – what the UK telecoms industry thinks of the budget

With the UK’s latest budget announcement came a familiar story about creating a digitally oriented economy, ensuring the country remains at the forefront of the global rankings. So, how much was a PR pitch and how much was solid?

Jamie Davies

March 8, 2017

6 Min Read
Better than nothing – what the UK telecoms industry thinks of the budget

With the UK’s latest budget announcement came a familiar story about creating a digitally oriented economy, ensuring the country remains at the forefront of the global rankings. So, how much was a PR pitch and how much was solid?

Last Autumn, the government established the National Productivity Investment Fund (NPIF), which will oversee £23 billion of investment between 2017 and 2022, in areas which the UK government believes critical to compete in the global economy. This budget statement brought a bit more clarity on vague plans to be the best, but what has the government actually promised?

  • The NPIF will invest £740 million in digital infrastructure by 2021 to support the next generation of mobile and broadband communications

  • £16 million will be used to create a new National 5G Innovation Network to trial and demonstrate 5G applications

  • £200 million to fund a programme of local projects to test ways to accelerate market delivery of new full-fibre broadband networks

  • Government investment of £400 million will be at least matched by private sector investors, and will accelerate the deployment of full-fibre networks by providing developers with greater access to commercial finance

The government is certainly making the right noises, but what does the industry think?

For Martin Moran, International MD at, the investments will certainly help address the highly publicised productivity gap in the UK, though there still needs to be more work done by business. The UK is falling behind not only because of shallow support from the government, but UK business being too traditional and not adventurous enough.

“Disruptive tech will be key to closing the productivity gap,” said Moran. “The use of artificial intelligence has transformed many businesses and it has the potential to empower the nation’s workforce in the coming years. Already we’re seeing the automation of mundane tasks as machines learn from each exchange. This has freed up employee time, allowing them to focus on more creative tasks and human interactions.

“At the heart of this is tackling the digital skills gap challenge, and we cannot expect the government to go it alone. Businesses and academics must work together to identify training needs. They need to create internship and job opportunities for people to advance their careers. Investment in training and regional devolution will help achieve this goal but more needs to be done.

Over at SAS UK, Charles Senabulya believes data and artificial intelligence (AI) are two areas which are key to gaining the competitive advantage.

“Data is the key to reinvigorating and growing many sectors to create a sustainable economy, these include manufacturing, professional services, retail banking and telecoms,” said Senabulya. “Research we recently conducted with CEBR indicated that big data analytics and the Internet of Things can create 182,000 new jobs in these sectors from 2015-2020, and inject £322 billion of additional revenue into the UK economy.

“The government has already taken steps towards this with plans to invest in artificial intelligence (AI) research. By partnering with businesses and academia, we can provide the right education and training opportunities for young people and the existing workforce, giving them access to jobs that demand data-driven technology skills.”

While it is well and good making the right noises about new technologies, for Simon Williams, SVP of Telco Media at NTT Data, the investments in fibre are long overdue. The importance in fibre has been over-talked and now the UK has fallen behind the rest of the world. Now is the time to do something about it.

“If the UK is to compete in a post-Brexit environment, an investment in 5G is critical,” said Williams. “In today’s Budget, the Chancellor promised to build the foundations of a stronger, fairer, more global Britain, and 5G technology is an essential first step. Not only will it enable businesses and customers to operate more efficiently, it will give operators much greater flexibility to offer a wider range of services at a more affordable price point.

“The roll out of fibre broadband is overdue but we are pleased to see the Chancellor promise investment. The UK is on the back foot so the Government must follow through on its promise. Not only do we not have enough fibre but BT has, thus far, only deployed fibre to the cabinet (FTTC). FTTP (Premises) is by far the best solution and investment will go a long way towards driving this faster.”

Maintel’s CTO Rufus Grig is another who agrees it’s about time for fibre investment, but the government must be careful to ensure distribution is fair. Centralization around London (in particular) and other cities has become an issue in recent years, but investments have to ensure rural connectivity is an objective as well.

“High-speed internet has never been more vital in ensuring that British organisations perform to their full potential,” said Grig. “Philip Hammond’s proposed investment in rural broadband is a huge step forward for all small businesses. However, it cannot stop there. More must be done to manage networking services for British companies if they are to compete on the global stage and drive our economy forward.

“Technology has the potential to replace physical workplace interaction in the future. This means real-time traffic on enterprise networks will continue to increase, through voice or video calls, screen-sharing, instant messaging or video casts. These business critical real-time applications, with low tolerance to delays or errors put networks under enormous strain. Maintaining uptime and performance can have a real impact on any companies bottom-line.

“Managing rural networking services cannot be ignored. High capacity fibre connections between data centres and managed broadband services for smaller sites and home workers is now an absolute.”

Over at Fairsail, CEO Adam Hale believes the announcement is somewhat of a PR move from the government. It’s a start, but more money needs to be spend to ensure the UK remains competitive in the digital economy.

“£500m to spend on skills is a nice headline-grabbing figure, but it’s not nearly enough,” said Hale. Neither is it focussed on where we need to radically improve skills – in IT. We would really like to see more focus on the T in STEM (Science, Technology, Engineering, Maths) – we think it’s T-time!

“We have a chronic IT talent shortage in the UK which we would like the government to address specifically, it’s a huge opportunity for the country.

“And with only 5,600 students studying Computer Science at A-Level in 2016, 600 of which were female, versus 31,000 doing Sociology, it’s no surprise. We could be aiming for at least a tenfold increase here over the next five years, with females making up at least 30%.

“In a world where every industry is rapidly digitising, we strongly encourage the government to make this a priority or scale ups like us will have to move technology off shore.”

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