The UK’s great digital divide

At Polestar we have written many blog posts outlining how firms have adapted to take the massive advantages technology provides to their business models. We have followed trends, new products, and focused our valuation papers to incorporate technology (such as healthtech, edtech, and industrial tech).

However, what about the group of people that don’t have access to the proper IT infrastructure needed for a tech enabled life?  They are missing out on the access to information and cheaper products available to the vast majority.

Accessing government services, cheaper insurance and education are all so much harder without decent internet.  We all lose – those without the internet, the providers of the infrastructure and society as whole.  Internet access is now as important as transport, the universal postage system and access to heathcare  etc.

How many people are offline?

Ofcom’s annual report shows that nearly 1.5 million Britons lack internet access. The largest groups within that number are 65 & overs and those from lower-income households. At a local level, Luton was the worst are hit by the digital divide during the pandemic. The Office for National Statistics (ONS) figures show that 6.6% of Luton’s population lacked access to digital equipment in 2019, increased to 22.2% in 2020 during the pandemic.  Think about it – nearly a quarter of people in Luton had no access to the internet.  As a nation this must be unacceptable.

The urban-rural divide

From a socioeconomic perspective, the biggest divide is from an urban-rural way of life. A survey conducted by the National Federation of Women’s Institute found that over 50% of respondents from a rural area felt that the internet they had access to was not fast and reliable. Less than 50% stated they had standard broadband and only 36% had superfast speeds, with 66% stating that they had been impacted by poor broadband. In comparison, only 18% of their urban counterparts said they had access to standard broadband and 67% had superfast broadband.

A market for telecoms businesses

Because there is a lack of IT infrastructure in the rural part of the UK, this is a potential opportunity, probably with government incentives, for telecoms businesses to generate a new market in the areas where there are a small number of competitors. Not only will this generate new growth for the telecoms industry, but also help residents get access to basic needs online, such as booking doctors appointments. 

However, even with government incentives this kind of roll out is unlikely to be financially interesting to the telco’s (or they would have done it!)  However should not just be about generating new customers, bridging this gap between the rural sector can help telecoms businesses align their social policies. For example, Vodafone is partnering up with Good Things Foundation to donate free mobile connectivity for a year to 15 community organisations across the South West. This follows Vodafone’s schools connected programme, which distributed 350,000 SIMs to schools and colleges across the UK, including more than 20,000 to the South West. The emergency package helped pupils who couldn’t access education from home because they didn’t have access to connectivity.

Universal access to the internet has become a necessity.  With the advent of 5G and other methods of delivery we should be applying pressure on politicians and the the Telcos to move this agenda forwards.  The Victorians managed it with the post – we will all win when we have proper coverage available to all.

Poor digital connectivity evidently impacts directly on our rural communities

By Anusheh Khan on 30/06/2021