2023 Internet Failures Lost UK Businesses £3.7bn, Survey Claims 

Business Broadband ISP Beaming recently commissioned a survey by Censuswide where UK based businesses were asked about their business broadband connections. 

The survey claimed that the surveyed businesses reported over 50 million lost hours due to internet failures in 2023, equating to a loss of £3.7 billion. 

Reductions in Time Lost, But a Soar in Associated Costs

Interestingly however, over the last 5 years the time businesses have lost has dropped by a fifth.

In 2023, the survey estimates that UK businesses experienced a cumulative 8.8 million internet failures, culminating in 50.5 million hours of downtime disrupting business processes, the ability to trade and impairing access to vital services. This is down from 60 million hours back in 2018. 

Despite a reduction in hours of downtime, the survey claims that the cost of this downtime has increased from £742m in 2018 to £3.7bn in 2023. 

Thankfully, things like the adoption of full fibre lines and improvements in broadband and network connection technologies does mean that incidents of internet downtime and failures are less common. 

On the flip side however, businesses are relying more and more on reliable connectivity for business process, operations and trading which we’ve seen increase over the last 5 years. This means that the cost of this downtime through missed sales, lost productivity and other business disruptions has risen by a whopping 400%. 

15% of UK businesses lose money as soon as connectivity fails

The survey highlighted an increased dependence on connectivity, with businesses relying on a strong connection for things like:

  • Communication
  • E-commerce
  • Access to cloud applications

This means that approximately 850,000 UK businesses would start to lose money the very moment their connectivity fails. 

Compared to 5 years ago, this is 81,000 more firms. 

39% of UK businesses would lose money during an 8-hour outage

If a business were to have an 8-hour internet outage, in other words a standard working day, 39% of UK businesses would lose money. This is an increase of 5% from 34% in 2018, and equates to 240,000 companies across the UK. 

Financial losses begin from 6 hour internet failures

The survey found that the median time for financial losses to begin following an internet failure is 6 hours for businesses with employees. This was true for employers of all sizes, from micro-companies (2-10 employees) to big businesses with more than 250 staff members. 

Internet disruptions worst for SME’s

During 2023, it was found that SME’s were hit the hardest by internet disruptions. 

They experienced an average of 3-4 failures culminating in 19 hours of downtime each. For those working a standard 8-hour day and 5-day week, more than 2 working days a year were lost to internet downtime. 

Biggest financial impact of internet downtime on Hospitality, IT and Manufacturing sectors

The sectors most affected by internet failures and downtime were found to be hospitality, IT and manufacturing. These sectors suffered the biggest financial impact. 

Hospitality businesses lost on average 27 hours to internet downtime in 2023, with businesses in the IT sector losing an estimated £555 million because of connectivity failures. 

A Couple of Caveats

As always with studies like these, there are a couple of cautions to take into consideration.

The study doesn’t explicitly define what an ‘internet failure’ actually is, so that could be anything from a problem with a site’s broadband ISP connection to a local network failure in an office. 

These different issues have likely been lumped together for the purposes of this survey. 

It’s also important to remember that Beaming being a UK based business ISP proves a vested interest in the results of this survey. 

Is Your Business the 1 in 5 with Insufficient Internet Speeds? 

Business leaders and decision makers from 160 UK companies were surveyed on their businesses broadband speeds during June 2023 by Neos Networks – 1 in every 5 were found to have broadband speeds that were insufficient. 

Furthermore, 42% of those surveyed planned to move to a higher capacity connection during the next two years as part of their key growth plans. 

Investment in Connectivity

Over the previous 2 years, 11.2% of respondents who had already invested in connectivity said it had a direct impact on their business profitability. 

And it’s not just profitability that’s impacted by good connectivity in business. 98.3% of surveyed businesses said it also impacted:

  • Productivity
  • Staff retention
  • Client collaboration

Why Are Businesses Prioritising Higher Capacity Connectivity?

Why might businesses prioritise higher capacity connectivity? Better performing broadband impacting many parts of the business, including:

  • Increased computer power (22.4%)
  • Operational development in terms of more data and higher capacity requirements (21.2%)
  • Greater device usage for each employee (11.6%)

With the prevalence of AI being used in business, this also influenced decisions to improve and increase connectivity with 1 in 10 businesses actively looking to increase connectivity in order to better integrate AI into their business processes.

What Is The Negative Impact of Insufficient Broadband Speeds in Business?

Poor internet connectivity, speed and/or reliability doesn’t just negatively impact employee productivity and retention, it can also cause businesses to risk losing a customer or client. 55.6% of businesses surveyed felt like they were at risk of losing custom down to poor internet. 

Has Project Gigabit Had A Notable Impact on Business Broadband?

The businesses being surveyed were asked if they felt their business had felt a notable impact from Project Gigabit, of which 52.5% said yes. 

Project Gigabit is a £5 billion government broadband plan aiming to deliver next-generation gigabit broadband to over a million households and businesses across the UK. You can read about their progress here

Project Gigabit didn’t actually start to award contracts until August 2022, so it’s possible that the above percentage figure is reflective of respondents including other similar schemes (like the Gigabit voucher and GigaHubs Dark Fibre) or other commercial upgrades to broadband services. 

Let’s Focus on the Positives

It’s clear that businesses are seeking high-capacity connections to keep up with new technologies as well as support their employees and customers. 

Of course, businesses that are based in more rural areas may well be part of the 1 in 5 businesses without sufficient broadband speeds that need improved network accessibility to achieve better connectivity. Other means of connecting to the internet may be useful, such as mobile internet through the likes of 4G/5G routers or Satellite broadband like Starlink

But if 1 in 5 businesses don’t have sufficient broadband, that means that 4 in 5 do! Recent data from Think Broadband suggests that only 21% of UK premises are yet to be reached by gigabit-capable broadband. That means 79% of business premises in the UK are covered by a broadband connection that is gigabit-capable. 

By 2030, the UK government is hoping to reach their target of having nationwide coverage. Network operators are hoping for more support so that they are able to help businesses with poor connectivity sooner than that. 

Rural businesses may be able to improve their connection through AltNet options. AltNet are alternative network providers offering fibre broadband packages. Although smaller in scale, AltNets compete with the UK and England’s big brand internet service providers. AltNets offer their own full fibre connections and don’t rely on the Openreach network and can sometimes offer higher upload speeds in comparison to the major network providers.

This could mean that rural businesses in hard to reach locations could have access to better internet services sooner than the national telecoms provider can offer, giving them next generation speeds like 2.5, 3 and 10 gigabit services across certain networks before national providers have even started trials. 

Let’s also remember that even though 1 in 5 businesses are receiving insufficient broadband, that doesn’t necessarily mean they don’t have access to it via other networks. There might be other options to the one they are currently using. 

The broadband demands of differing businesses also vary hugely. A graphic design studio or video editing company would need higher speed internet than a takeaway shop that could rely on a slower link. 

As always, these types of surveys should be taken with a pinch of salt. Whilst it is undeniable that there are 1 in 5 businesses with insufficient broadband, there should be options for them to explore like mobile broadband and satellite broadband like Starlink. 

Can we help your business improve its broadband connection?

If your business is struggling with a poor internet connection, then get in touch with our expert Wi-Fi engineers who will be able to advise if mobile broadband or Starlink satellite broadband could be a viable option for you. Give us a call or drop us an email today and let’s get it sorted.