rural business report

RU R A L BUS I N E SS

R E P OR TJ U LY 2 0 21

I N T RODUC T ION F ROM GA R ET H W I L L I A MS

“The pandemic sharply underlined the importance of internet connectivity. For many business leaders, myself included, maintaining any level of business continuity through the various lockdown periods would have been nigh on impossible without functioning broadband.

“But, despite having one of the most advanced and sophisticated economies in the world, there are still areas of England where internet speeds are unable to meet basic needs such as sending an email or opening a webpage.

“This report explores the state of internet access and internet speeds in rural England, and its impact on businesses.

“The data, which we compiled and analysed in partnership with the Countryside Alliance, shines

a light on the challenges, ambitions and opportunities open to rural businesses. It gets under the skin of how they use broadband and how its speed, or lack thereof, has helped and hampered their growth plans.

“Despite the work we’ve been doing over the last ten years to connect some of the most rural areas of the country to our ultrafast network, rural businesses are still at a disadvantage. We hope that, by shining a light on how difficult the situation is, we can show how critical it is that UK Government acts to address the enduring barriers to rolling out gigabit capable infrastructure in rural communities.”

Gareth Williams CEO, Gigaclear

2

“This report explores the state of internet access and internet speeds in rural England, and its impact on businesses.”

Rural Business Report

I N T RODUC T ION F ROM SA R A H L EE

“A successful rural economy is vital for maintaining a living and working countryside. As we move into a digital age the rural economy is becoming more reliant on digital connectivity.

“The countryside economy is already 16% less productive than the national average, but has enormous untapped potential which good connectivity would help unleash. If you were to level up the countryside by delivering connectivity, the economy has the potential to grow by up to £43bn in England alone.

“The pandemic has once again highlighted the disparity in broadband connectivity across the country, but has been particularly felt by those businesses operating in rural areas, as the networks have struggled to keep up with unprecedented demand.

“This is why this important report is so timely and highlights the real struggles rural businesses face when it comes to operating in a digital world, without decent connectivity.

“Whether you are running a farm B&B or a design agency, connectivity is vital for the success of any business. While the Government is hugely ambitious for a digital Britain, an ambition we fully support, it is currently the case that those running businesses in the countryside simply do not have the connectivity that they need and deserve. The Government must deliver on its ambition. Fundamentally, we should all be digitally connected, no matter where we live.”

Sarah Lee Director of Policy, Countryside Alliance

3

“The pandemic has once again highlighted the disparity in broadband connectivity across the country, but has been particularly felt by those businesses operating in rural areas.”


DIGI TA L I N F R AST RUC T U R E M I N IST ER M AT T WA R M A N SA I D:

“Improving internet access is central to our plan to build back better from the pandemic and the government is funding the biggest broadband rollout in British history in order to dismantle the digital divide between urban and rural.

“Our record £5 billion Project Gigabit fund is prioritising bringing lightning-fast speeds to rural areas and we are exploring using innovative wireless and satellite technologies to connect the hardest to reach.

“We welcome Gigaclear’s report and will consider its findings as we press on with our ambitious plans to boost businesses and stimulate investment in the UK’s countryside communities.”

Matt Warman Digital Infrastructure Minister

4Rural Business Report

E X EC U T I V E SU M M A RY CON T E N TS

6 Methodology

7 Rural Business: Benefits & Challenges

9 The State of Rural Broadband

12 The Impact of COVID on Rural Business

14 Post-Covid Recovery

16 The Future of Rural Broadband & Business

17 Conclusion from Gareth Williams, CEO, Gigaclear

5

85%

65%

Only 7%

14%

1 in 5

80%

of rural businesses report their internet as being either poor but manageable (47%), or unmanageably poor (38%)

of business owners have invested in either a 4G router (45%), or satellite internet access (20%), increasing business overheads

of rural businesses have full fibre internet, while over half (56%) have an ADSL copper connection

of rural businesses have closed completely since the pandemic

businesses have had to resort to working out of a café or equivalent public space to get the required connectivity to operate

said better internet access would have the single biggest positive impact on their business recovery post-pandemic


6

The data in this report was collected from 651 survey respondents, all members of the Countryside Alliance and all owners / operators of rural businesses.

Nearly a third (30%) of survey respondents operate agriculture, forestry, hunting and fishing businesses. But the remaining 70% work in a range of sectors you would expect to see in any town or city, including professional, scientific and technical services (9%), accommodation (7%), real estate (4%), information and communication (4%), finance (4%) and construction (3%).

What type of business do you operate?

MET HODOLOGY

0

5

10

15

20

25

30

35

Acco

mm

odat

ion

Adm

inist

rativ

e &

supp

ort s

ervic

es

Agric

ultu

re, f

ores

try,

hunt

ing

& fis

hing

Arts

& c

rafts

Bars

or p

ubs

Butc

her

Bake

ry

Cafe

Clot

hing

& A

cces

sorie

s

Char

ity

Crea

tive

serv

ices

Ente

rtain

men

t

Cons

truct

ion

Educ

atio

n, h

ealth

& so

cial w

ork

Fina

nce

Gun

Mak

ers

Info

rmat

ion

& co

mm

unica

tion

Man

ufac

turin

g

Min

ing/

quar

ryin

g an

d ut

ilities

Prof

essio

nal, s

cient

ific&

tech

nica

l ser

vices

Publ

ic ad

min

and

def

ence

;ot

her s

ervic

es

Real

esta

te a

ctivi

ties

Tran

spor

t and

sto

rage

Shoo

ting

supp

liers

Who

lesale

, ret

ail &

repa

ir of

mot

or v

ehicl

es

Oth

er (p

lease

spe

cify)


7

Broadband internet speeds in rural England are, for the most part, significantly slower than urban areas.1

Yet even with such a significant disparity, it could still be the case that the state of internet access in rural England is at least serviceable. But, according to the business owners we surveyed, that is not the case. They report the benefits as being things like pleasant working environments (82%), a better work/life balance (62%), the proximity to nature (54%), shorter commutes (37%), the ability to work with friends and family (32%), and the joy that comes from carrying on family traditions (34%), among other things.

Unsurprisingly, internet connectivity does not feature in that list.

In fact, rather than being overblown, poor internet connectivity is a challenge faced by 90% of business owners surveyed. To put the universality of the problem into context, the next most common challenges faced by rural businesses are a lack of transport links (32%), road size and condition (31%), and crime (15%).

Interestingly, after crime, the next most common challenge is not being taken as seriously as competitors based in towns and cities (14%). Could internet access play a part in this perception? We delved a little further into the state of rural broadband…

Before the pandemic, what benefits did you experience operating a rural business?

1 Broadband (publishing.service.gov.uk)

RU R A L BUSI N E SS: BE N E FI TS & CH A LLE NGE S

0

20

40

60

80

100

Mor

e sp

ace

for m

ybu

sines

s pr

emise

s

It en

ables

you

to c

ontin

uea

tradi

tiona

l cra

ft or

skil

l

The

abilit

y to

be

able

to c

ontin

uea

fam

ily b

usin

ess/

tradi

tion

Prox

imity

to n

atur

e

Bette

r wor

k/life

bala

nce

Mor

e af

ford

able

busin

ess

rate

s

Mor

e af

ford

able

mor

tgag

e or

rent

Less

com

petit

ion

Gre

ater

cus

tom

er lo

yalty

Sens

e of

com

mun

ity

Low

er s

taff

cost

s

Wor

king

with

frien

ds o

r fam

ily

Shor

ter c

omm

ute

(clo

ser t

o ho

me)

Mor

e pl

easa

nt c

omm

ute

Plea

sant

wor

king

envir

onm

ent


8

Before the pandemic, which of the following challenges did you face as a rural business?

RU R A L BUS I N E S S: BE N E F I TS & CH A LLE NGE S

0

20

40

60

80

100

Oth

er (p

lease

spe

cify)

Busin

ess

prem

ises

not g

iving

the

right

impr

essio

n of

the

com

pany

Lack

of c

hoice

of s

uita

ble

busin

ess

prem

ises

Mar

ketin

g th

e bu

sines

sis

mor

e di

fficu

lt

No p

assin

g tra

de/c

usto

mer

s

Com

petit

ion

(via

inte

rnet

)

Crim

e

Not b

eing

take

n as

ser

ious

lyas

tow

n/cit

y-ba

sed

com

petit

ors

Lack

of s

uppo

rting

amen

ities

in lo

cal a

rea

Cost

of i

mpo

rting

/ ex

porti

ng

Road

size

/ co

nditio

n

Diffi

culty

Ret

ainin

g st

aff

Diffi

culty

Attr

actin

g st

aff

Shor

tage

of s

killed

wor

kers

Shor

tage

of g

ener

alta

lent t

o ch

oose

from

Poor

tran

spor

t lin

ks

Poor

inte

rnet

con

nect

ion


9

Perhaps unsurprisingly, the majority of respondents (56%) claimed to have old-school copper wire (ADSL) broadband connections.

Fibre / copper (FTTC) connections, which have been the norm in towns and cities for over ten years and are about five times faster than pure copper ADSL connections, only account for 18% of rural broadband connections and still suffer from the problem of the speed of service degrading over distance.

Only 7% report having full fibre/ Fibre to the Property (FTTP), the type of connection that best enables uninterrupted video conferencing, conference streaming, large file uploading and downloading and ultrafast browsing.

This difference in take up of connection technologies does appear to play out in terms of service quality. 85% of respondents report their internet as being either poor but manageable (47%), or unmanageably poor (38%).

What type of internet connection do you have?

T HE STAT E OF RU R A L BROA DBA N D

0

10

20

30

40

50

60

Don’t knowFull fibre to the property (FTTP)

Fibre/copper (FTTC)Copper wire (ADSL)


Do you currently suffer from a poor internet connection?

10

Despite this, the survey responses evidence rural businesses needing internet access just as much as anyone else. Even in rural areas, connectivity is a necessity to modern commerce, so rural businesses have little choice but to persist with extremely poor internet speeds to access information online (82%), access business tools and services (71%), communicate with existing customers (81%) and conduct marketing to reach new potential customers (58%).

Rural businesses are accessing the internet, however, albeit through their own efforts.


0

10

20

30

40

50

No, I have always been well connected to ultrafast internet

No, I have ultrafast internet now, but I have

suffered from a poor internet connection

in the past

My internet speeds are about average (around 30Mbps)

Yes, my internet connection is poor

but it’s just about manageable

Yes, my internet connection is

unmanageably poor


In the past, what have you done to try to circumvent poor internet speeds?

Rural Business Report 11

Nearly half (45%) have had to invest in a 4G router to be able to get reliable access to the internet. While a fifth paid for a satellite connection or simply upped sticks and worked from a café in town (20% and 19% respectively).

Shockingly though, 26% admit to paying for IT support that simply cannot solve the issue of poor internet connectivity. And extreme measures are being taken in some cases, with 7% hiring an agency or freelancer to access the internet for them, and 3% giving up and moving premises all together.


0

10

20

30

40

50

Oth

er (p

lease

spe

cify)

Mov

ed p

rem

ises

Wor

ked

at a

caf

é or

oth

er p

ublic

spa

ce

Got

sta

ff to

wor

k fro

m h

ome

Take

n w

ork

hom

e

Spen

t lot

s of

mon

ey o

n IT

sup

port

Clos

ed s

hop

to u

sein

tern

et s

omew

here

else

Hire

d an

age

ncy

or fr

eelan

cer t

om

anag

e on

line

oper

atio

ns

Paid

for a

sat

ellite

inte

rnet

con

nect

ion

Boug

ht a

4G

rout

er


Like many businesses across the country, 44% of the rural businesses surveyed have been able to continue their operations by working from home during the pandemic, a further 5% closed shopfronts, but continued operating online.

Obviously, the result has been increased reliance on the internet to maintain business continuity. Zoom and Teams have been as essential in rural England as anywhere else, with 70% using video conferencing to stay in touch with clients. Supplier communications (61%), continuing sales online (41%), online marketing (35%), communicating with staff (33%), all these things have put extra strain on rural business’ internet connections.

Has your business had to close in the lockdown period/s?

T HE IMPACT OF COV ID ON RU R A L BUSI N E SS

0

10

20

30

40

50

Other (please specify)No, we haven't closed but are

working from home

We’re an essential business and have

been operating throughout the

lockdown periods

Our store front closed, but we are still operating online

We closed for one lockdown but

remained open for the others

Yes, we’ve closed completely

13

And it’s not just the “soft” or unmeasurable business operations that have had to go online. COVID has meant increased precautions even for essential businesses like grocers and butchers, that’s why 10% have invested in contactless payment systems that require internet access to operate, despite their poor connections.

In what ways has your business relied on the internet throughout the pandemic?

T HE IMPACT OF COV ID ON RU R A L BUSIN E SS

0

10

20

30

40

50

60

70

80

Oth

er (p

leas

e sp

ecify

)

Inst

alle

d co

ntac

tless

pay

men

tsy

stem

for i

n-pe

rson

pay

men

ts

Incr

ease

d so

cial

med

ia a

ctivi

tyto

kee

p cu

stom

er e

ngag

emen

t up

Incr

ease

d co

nten

t on

the

web

site,

suc

h as

mor

e ph

otog

raph

s of

pro

duct

s,to

acc

ount

for t

he fa

ct th

at p

eopl

eco

uldn

’t se

e th

em in

per

son

befo

re b

uyin

g

Zoom

/Tea

ms

calls

with

em

ploy

ees

to k

eep

them

mot

ivate

d

Dive

rsify

ing

my

busin

ess

to b

e ec

omm

erce

led

Keep

ing

cust

omer

s up

to d

ate

with

ope

ning

hou

rs a

ndCO

VID

prec

autio

ns

Reac

hing

new

cus

tom

ers

thro

ugh

onlin

e m

arke

ting

Cont

inui

ng s

ales

thro

ugh

the

inte

rnet

Com

mun

icat

ing

with

sup

plie

rs

Clie

nt m

eetin

gsth

roug

h Zo

om

13Rural Business Report


0

10

20

30

40

50

60

70

80

Oth

er (p

lease

spec

ify)

Gov

ernm

ent

finan

cial s

uppo

rt

Chea

per p

rope

rtym

ainte

nanc

e

Chea

per

impo

rting

/ ex

porti

ng

Bette

r roa

d co

nditio

ns

Bigg

er ta

lent p

ool

to e

mpl

oy fr

om

Ultra

fast

inte

rnet

conn

ectio

n

When asked ‘what would have the single biggest positive impact on their business recovery post-pandemic’, only 8% said more Government financial support. Only 3% said a bigger talent pool to recruit from or better road conditions. Only 2% said discounted importing and exporting. Only 0.6% said cheaper property maintenance.

POST- COV ID R ECOV E RY

of respondants said better internet access would help their business recover

80%

In terms of business recovery after the pandemic, which of the following would have the single biggest positive impact on your business?


The vast majority of rural businesses surveyed (58%) believe they could recover post-COVID at least 50% faster with ultrafast internet than without, with 20% saying twice as fast and 12% saying even faster than that.

It’s clear that rural businesses are crying out for better internet access.

POST- COV ID R ECOV E RY

How much faster could your business recover post-COVID if you had better internet access?

0

5

10

15

20

25

We

don’

t use

the

inte

rnet

Mor

e th

an tw

otim

es fa

ster

Twic

e as

fast

75%

fast

er

50%

fast

er

25%

fast

er

10%

fast

er

No fa

ster

(our

inte

rnet

conn

ectio

n is

ultra

fast

)


of the country is to have gigabit capable internet by 2025, according to Government plans

86%

0

10

20

30

40

50

I don

’t kn

ow b

ut I

am n

ot c

once

rned

I don

’t kn

ow b

ut I

am c

once

rned

I may

hav

e to

cons

ider

clo

sing

It w

ill be

diffi

cult

tom

ainta

in th

e sp

eed

and

quali

ty o

f ser

vice

I offe

r

It w

ill be

diffi

cult

tore

cove

r pos

t-CO

VID

My s

taff

will

have

tow

ork

from

hom

e

I will

stru

ggle

to k

eep

up w

ith th

e co

mpe

titio

n

It w

ill be

diffi

cult

to g

row

I may

hav

e to

con

sider

mov

ing m

y bus

iness

to a

bette

r-con

nect

ed a

rea

It w

ould

not

impa

ctm

y bus

iness

The Government aims to connect atleast 85% of the country to gigabit capable internet by 2025. Gigaclear, among others, is working to achieve this commercially and in partnership with BDUK.

The importance of that target to rural businesses cannot be understated. If their broadband connection was to never improve, 20% of respondents said they would consider moving their businesses to a better-connected area, 41% would find it difficult to grow, and 46% said they would struggle to keep up with their competition.

T HE F U T U R E OF RU R A L BROA DBA N D & BUSI N E SS

If your internet connection never improved, how would it impact your business?

CONC LUSION F ROM GA R ET H W I L L I A MS, CEO, GIGAC L E A R

“In the last 30 years, internet connectivity has gone from a novelty to an essential part of day-to-day life. It’s exceptionally hard to operate a modern business, let alone grow, without it.

“Businesses in rural England have been largely left behind by the telecoms market. It is, ultimately, harder and more expensive to build gigabit capable networks to them than in urban areas. Properties tend to be further apart, roads tend to be smaller, and communities can be separated by miles of privately owned agricultural land.

“The pandemic has brought this issue to the public consciousness as we’ve all had to rely on the internet more than ever over the last 18 months. But the situation has been dire for years.

“With the support of the Government, companies like Gigaclear are expanding their networks across rural England to connect businesses to not just working broadband, but gigabit-capable broadband with speeds comparable to that in Silicon Valley.

“This represents a huge economic opportunity, not just for individual businesses, but for the country as a whole, at a time when economic opportunities are desperately needed.

“But there are still obstacles to overcome. The negotiation of land access is one of the most significant causes of delay to rural network rollout. This issue disproportionately impacts rural areas, as land holdings are often larger than in urban areas. Where urban network operators often have multiple build routes available to them at a similar build cost, rural rollout is then more likely to be dependent on a single critical path in order to be commercially viable. When land access cannot then be negotiated in a timely, reliable way, delays and descope of work are far more likely.

“As DCMS reflects on the responses to its recent consultation on reforming the Electronic Communications Code to simplify and accelerate fixed network operator land access, I hope this research reinforces the need for such reform.

“Can we connect 85% of the country by 2025? It’s ambitious, but we hope so.”


Gareth Williams CEO, Gigaclear

rural business report

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