Light Reading

Time to Get Smart About SMB Services

Ray Le Maistre
7/14/2014
50%
50%

A report published today highlights how small businesses -- in this instance, in the UK -- feel they are being short-changed in the broadband economy, either because they are not being offered decent connectivity, or they're being offered services that, when available, are often too expensive. (See Small UK Firms Left Stranded by ISPs – Report.)

The report was mostly negative about the services on offer, the pricing, the attitude of ISPs, the state of Government financial support, and so on. And that's not so surprising, given that the report was published by the Federation for Small Businesses (FSB), with all its vested interests.

But the FSB, in its detailed, 52-page report does make a decent case in many respects, especially when it comes to the dire way in which the UK government has handled broadband initiatives and funding: The UK government pays a lot of lip service to the digital economy, but often (as is the case with many governments and political parties) fails to show any true understanding of how global economic operations need to be supported or what the real needs of businesses and individuals are in the modern world.

But while some things are unlikely to change -- politicians will no doubt continue to be largely clueless about anything that doesn't directly affect them -- the capabilities of communications service providers have changed. For as long as I can recall, small businesses have felt they are not catered for by fixed and mobile operators and the local communications specialists that sell them services packages. Often that was because of the technical and operational limitations of the service providers, restricted to costly fiber rollouts and/or low-bandwidth wireless delivery platforms for the delivery of uninspiring and restrictive services packages.

But times have changed, haven't they? Fixed and wireless broadband (4G LTE, WiFi and even satellite) services are now more pervasive, the ability to sweat the installed copper tails of the fixed-line networks is now greatly enhanced by VDSL2 and new emerging standards such as G.fast, and there are many business-oriented applications that can be enabled across a vanilla broadband connection, while tiered packages of unified communications and cloud services are now more easily provisioned for all types of customers, including even the smallest of businesses. Right? RIGHT?!

In the UK, the small business market has long been the preserve of national operator BT Group plc (NYSE: BT; London: BTA): The arrival of 4G and the increasing availability of mobile-enabled data services provides a much greater opportunity for the mobile operators to launch a real challenge to the incumbent, and certainly EE , Telefónica UK Ltd. (O2), and Vodafone UK have all been making moves targeting the SMB sector lately.

The FSB report suggests that such moves will take time to make any impact, if they move the needle at all -- this isn't the first time that service providers have boasted of new, resource-heavy assaults on the SMB market. But there is still real market potential: Delivering a decent broadband connection to a remote, rural business is undoubtedly going to be a real challenge for any service provider for a long time to come, but it seems there are plenty of small businesses in urban and semi-urban areas (according to the FSB report) that are still underserved, and that's where much of the 4G LTE rollouts are focused.

In addition, the emergence of 4G is coinciding with the interest in the Internet of Things (IoT) and the potential for urban authorities to enhance their business communities by launching 'smart city' initiatives, which need broadband infrastructure as the underpinning infrastructure.

In a services industry that is constantly searching for new revenue streams, one of the oldest and potentially largest markets -- delivering tiered communications services to small and medium-sized businesses -- still looks ripe for the picking. The FSB report is all about the UK market, but this just highlights the potential that exists in many developed markets, all of which show the same trends of pressurized incumbents, enhanced, mobile broadband, growing cloud service availability, and a disgruntled business customer base.

It's time for the communications service providers to get smart too and make big money from the small business market.

— Ray Le Maistre, Circle me on Google+ Follow me on TwitterVisit my LinkedIn profile, Editor-in-Chief, Light Reading

(5)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
DHagar
50%
50%
DHagar,
User Rank: Light Sabre
7/28/2014 | 1:29:28 PM
Re: Time to Get Smart About SMB Services
@calbert234, interesting points.  My comment is focused on the "partnership" that can advance connectivity (wired or wireless) through public/private collaboration, making a universal access available that can assist SMB.  If you had that infrastructure in place then private preferences (i.e., fast wired connections) can be built to serve those needs, without having to separately invest in the infrastructure costs.

Obviously, you are holding out for the best for Nigeria - that is great!

 
calbert234
50%
50%
calbert234,
User Rank: Light Beer
7/28/2014 | 11:47:37 AM
Re: Time to Get Smart About SMB Services
I do not agree that mobile broadband can be a substitute for wired broadband access. The trend in both cases are very different. In the mobile world, increase in data speed, results in increase in the cost of the services while in the wired access, increase in speed often result in decrease in cost of services. In my country Nigeria, alot of people are of the opinion that mobile is a substitute for wired access and I always argue it out. Till we achieve wired broadband, I will keep up with my expensive and unreliable internet dongle. 
DHagar
50%
50%
DHagar,
User Rank: Light Sabre
7/15/2014 | 3:45:05 PM
Re: Time to Get Smart About SMB Services
@FakeMitchWagner, exactly.  We need new and better models of public/private partnerships.  Local government, in particular, can play a positive role in partnering with industry, who better understands technology.
Mitch Wagner
50%
50%
Mitch Wagner,
User Rank: Lightning
7/15/2014 | 2:56:59 PM
Re: Time to Get Smart About SMB Services

Government not understanding technology is a problem on both sides of the Atlantic. One school of thought says, well, get government out of technology and business! But that's no answer at all. Because so much of the technology industry is a natural monopoly, government needs to be active. And it needs to be smart about 

DHagar
50%
50%
DHagar,
User Rank: Light Sabre
7/14/2014 | 8:21:09 PM
Re: Time to Get Smart About SMB Services
@Ray, great insight.  They are truly missing the market opportunity in developing communications connectivity through tiered communication services, as you point out.  Cities are stepping up and developing, or partnering, to provide broadband infrastructure; so it is only a matter of time where connectivity will be a utility.  Then the markets for the developing SMB market will make sense.

You are right that the FSB is a vested voice, but the issue is of greater value to regional economic development at large.
More Blogs from Shades of Ray
The global launch of Huawei's P8 smartphone was stage-managed within an inch of its life – but it didn't need to be.
There's a lot to take in regarding the planned combination of Nokia and Alcatel-Lucent – here's a quick guide to our coverage.
The potential merger of Nokia and Alcatel-Lucent will throw a spotlight on some key decisions that need to be made, particularly related to the wireless portfolio, IP relationships and management of the combined company.
Deadline extension means there are still a few more days to submit those winning entries, but don't delay -- April 10 is the final deadline and then the judging begins.
British carrier really wants to sweat that copper plant and sees a real opportunity to use that asset for high-speed backhaul.
Flash Poll
From The Founder
Ericsson's Hyperscale Datacenter System (HDS) 8000, featuring Intel's Rack Scale Architecture, caused a stir when it was announced at MWC 2015. For more on this revolutionary product, join me on Thursday, April 30 at 12:00 p.m. EST for a Super Webinar event, A New Hardware Paradigm for the Telco Data Center.
LRTV Documentaries
Cox Eyes Cloud-Based Home Networks

4|27|15   |   05:30   |   (0) comments


Cox's Jeff Finkelstein explains how moving services to the cloud will let cable deliver services faster and eliminate constant hardware replacements.
LRTV Documentaries
CableLabs' Clarke Updates Cable Virtualization

4|23|15   |   05:41   |   (1) comment


Former BT exec now leading CableLabs' NFV and SDN efforts explains key role of open source and updates efforts to virtualize the home network.
LRTV Interviews
Ericsson's CTO Talks Transformation: Pt. II

4|23|15   |   08:19   |   (1) comment


In the second installment of an in-depth two-part interview, Ericsson's CTO Ulf Ewaldsson talks to Light Reading CEO and founder Steve Saunders about cultural change, network slicing and technology advances.
LRTV Interviews
Ericsson's CTO Talks Transformation: Pt. I

4|23|15   |   09:27   |   (3) comments


In the first installment of an in-depth two-part interview, Ericsson's CTO Ulf Ewaldsson talks to Light Reading CEO and founder Steve Saunders about the incredible transformation underway in the communications networking industry.
LRTV Documentaries
LTE Paves the Way for the 5G Revolution

4|20|15   |   4:20   |   (0) comments


Håkan Andersson, head of 5G product strategy of the Radio Business Unit at Ericsson, discusses the role of LTE, the US and other industry verticals in building a true 5G ecosystem.
LRTV Documentaries
The 3GPP's Road to 5G Standardization

4|17|15   |   4:43   |   (0) comments


Satoshi Nagata, chairman of the 3GPP's TSG-RAN group and a manager at NTT Docomo, explains the standardization process for 5G, as well as the biggest challenges and opportunities.
LRTV Documentaries
AlcaLu CTO Makes the Case for a New 5G Air Interface

4|16|15   |   3:54   |   (0) comments


Michael Peeters, CTO of wireless at Alcatel-Lucent, explains why 5G will require a new air interface to meet its diverse performance targets.
LRTV Documentaries
AlcaLu + Nokia: The New Uber-Vendor

4|15|15   |   2:42   |   (4) comments


Heavy Reading Senior Analyst Gabriel Brown discusses the technological and competitive opportunities and challenges if a merger between Alcatel-Lucent and Nokia comes to pass.
LRTV Huawei Video Resource Center
Huawei's Data Center Power Play

4|15|15   |   6:22   |   (0) comments


Huawei has developed industry-leading energy efficiency capabilities for its indoor and outdoor data center solutions, explains Dr. Fang Liangzhou, vice president of Huawei's Network Energy product Line.
LRTV Huawei Video Resource Center
Huawei’s Routers, Switches Get the Green Mark

4|15|15   |   2:02   |   (0) comments


TUV Rheinland's Frank Dudley explains how Huawei's routers and switches have been successfully tested by energy efficiency experts and have gained Green Mark Certification.
LRTV Documentaries
A Finn, a Frenchman & a Guy From New Jersey Walk Into a Merger...

4|15|15   |   3:17   |   (0) comments


Stop us if you've heard this one before... Light Reading CEO Founder & CEO Steve Saunders weighs in on the technical and cultural implications of a Nokia and Alcatel-Lucent merger.
LRTV Huawei Video Resource Center
Accounting for Better Solutions

4|10|15   |   02:31   |   (1) comment


Murad Yousuf, CTO at Saudi Arabia's Ministry of Finance (Dept. of Zakat & Income Tax), talks about the benefits of deploying router technology from Huawei.
Upcoming Live Events
May 6, 2015, Georgia World Congress, Atlanta, GA
May 12, 2015, Grand Hyatt, Denver, CO
May 13-14, 2015, The Westin Peachtree, Atlanta, GA
June 8, 2015, Chicago, IL
June 9-10, 2015, Chicago, IL
June 9, 2015, Chicago, IL
June 10, 2015, Chicago, IL
September 29-30, 2015, The Westin Grand Müchen, Munich, Germany
October 6, 2015, Westin Peachtree Plaza, Atlanta, GA
November 11-12, 2015, The Westin Peachtree Plaza, Atlanta, GA
All Upcoming Live Events
Infographics
In its latest survey covering network operators' plans and strategies for ICT transformation, Heavy Reading asked telecom operators worldwide to identify the most important goals and objectives for their ICT transformation initiatives. Heavy Reading also asked operators about the importance of a "digital first" strategy, which enables customers to complete an interaction across different digital channels, such as web and mobile self-service and social media.
Hot Topics
Comcast Formally Ends Its Bid for TWC
Mari Silbey, Independent Technology Editor, 4/24/2015
Comcast Reportedly Dropping $45B TWC Bid
Sarah Thomas, Editorial Operations Director, 4/23/2015
Google's WiFi-First Mobile Service 'Fi' Is Here
Dan Jones, Mobile Editor, 4/22/2015
Amazon Earnings: What to Watch For
Mitch Wagner, West Coast Bureau Chief, Light Reading, 4/23/2015
Adtran Is Developing White Box GPON Tech
Ray Le Maistre, Editor-in-chief, 4/24/2015
Like Us on Facebook
Twitter Feed
Webinar Archive
BETWEEN THE CEOs - Executive Interviews
Many leading communications companies can claim to have undergone significant periods of reinvention during their histories, but none have been through more major ...
Data Center Interconnect, or DCI, is one of the hottest sectors in telecom currently. Since coming back to Light Reading last year, prodigal-son style, I've ...
Cats with Phones
Learning Curve Click Here
Pierre could never remember how to use Excel.
Latest Comment