Key to Great British growth could lie beneath its streets

Study indicates huge economic potential unlocked by a national full fibre roll-out

A report released today has demonstrated the billions of pounds of productivity, innovation and employment benefits that could be unlocked by the widespread construction of full fibre networks, suggesting that the solution to Britain’s productivity woes and stagnating growth could lie beneath our feet.

The study by economic consultancy Regeneris, commissioned by digital infrastructure builder CityFibre, examined ten areas of the UK economy likely to benefit from full fibre roll-outs. It also sought to quantify the impact of each of these areas in 100 distinct UK town and city economies over a 15-year period.

According to researchers, the UK’s business community, most particularly its small and medium sized companies, could stand to benefit enormously. Access to full fibre could unlock £4.5bn in business productivity, innovation and access to new markets in these locations; a further £2.3bn in growth could be driven from catalysing new business start-ups; while the increased ability for companies to support flexible working could add £1.9bn.

The UK’s homeowners and wider property market can also expect to reap rewards. With access to reliable, high speed broadband becoming ever-more important to buyers, up to £7bn could be added to the value of homes. What’s more, by expanding the range of physical services that can be accessed digitally such as e-commerce and telecommuting, the nation’s consumers and workers could reduce their carbon emissions by over 2.3m tonnes.

The economic impacts unlocked by full fibre in these 100 locations will extend much further. Full fibre is an essential platform for the roll-out of 5G, unleashing £28bn in benefits, as well as for the Internet of Things and Industry 4.0, where £10bn in benefits can be expected. Wider Smart City enablement, from infrastructure and services to smart energy networks could add as much as £5bn in the 100 locations examined in the report, while technological improvements in the delivery of healthcare services are worth £1.1bn.

Crucially the network roll-out itself would drive £2.1bn direct economic growth and at the height of deployment close to 7000 jobs would be created in the construction and civil engineering sectors.

While the report does not seek to provide one single economic impact figure, it does add to the growing body of evidence pointing to the immense scale and scope of economic uplift that is likely be created by full fibre, over and above today’s broadband infrastructure. Research from the FTTH Council in the US suggests that providing full fibre to just half of all premises in a location could result in a 1.1% rise in annual GDP. Applying this to the 100 distinct city and town economies in the Regeneris report indicates total economic impact of full fibre in these places alone could be in the range of £120bn. Nationwide full fibre coverage across the UK, would therefore be much higher.

Speaking of the report, Simon Hooton, Director at Regeneris, said: “Our findings clearly indicate that full fibre will provide the core infrastructure required to kick start the next generation of digital technology and drive expansion of smart infrastructure in towns and cities where it is deployed. The result will be a modernised, more productive and innovative UK economy.”

CityFibre is now calling for an accelerated roll-out of full-fibre infrastructure, supported by a clear political and regulatory plan that will maximise the investment potential of the multiple players now looking to deploy these networks. It is also arguing that the new findings add further weight to the argument that the ASA should reverse its decision to approve the continued use of the term ‘fibre’ to describe services delivered over copper-based networks.

Greg Mesch, CEO at CityFibre, explained: “The UK economy is crying out for a shot in the arm and this report clearly demonstrates that a national full fibre roll-out would do just that. This is a discussion about far more than just broadband, it is about the digital infrastructure set to power our economy for decades to come.

"CityFibre’s roll-out across our 42 towns and cities is under-way, and we are on track to deliver our goal of full fibre in 100 towns and cities. Given the size of the prize for the UK, all players, from industry, government, and Ofcom, need to focus on setting the conditions needed to deliver the maximum possible coverage in the shortest possible time. Only then will we unlock and unleash the full economic potential of full fibre, and that of the towns and cities in which it is built.”

ENDS

Issued on behalf of CityFibre by Weber Shandwick, PR Consultants for CityFibre. For more information or images, contact: Dyan Owen, Account Director at Weber Shandwick, on 07738 086 818 or dowen@webershandwick.com.

Research Summary

Regeneris used their in-house broadband impact model to assess the economic benefits that will be generated:

• as a result of full-fibre construction
• in terms in terms of business productivity improvement, innovation, new business starts and worker flexibility
• for private households via increases in house prices and housing wealth.

This built on the latest research and evidence in these areas and economic, business, and household data for the 100 locations that were the focus of our study. It applied assumptions on the rate adoption of full fibre adoption, the time over which adoption and associated benefits build-up for example.

They also reviewed a range of findings that point to full fibre’s potential for generating wider economic benefits across five areas where robust evidence/research exists, to illustrate this potential:

1. the impact of 5G mobile networks, which will require full fibre backhaul
2. smart cities infrastructure such as reductions in energy use, congestion and fuel costs stemming from smart energy and traffic systems
3. increased manufacturing productivity secured from the emerging digital revolution in manufacturing (Industry 4.0) and connected Internet of Things (IoT) devices
4. healthcare benefits through advances in connected health technologies
5. environmental impacts through carbon reduction.

Key Findings

Businesses (particularly SMEs):

• £2.2bn in productivity stimulus
• £2.3bn in innovation benefits
• £2.3bn in growth resulting from new business start-ups
• £1.9bn in flexible working benefits

Households:

• households could benefit collectively to the sum of £7bn through increased property value
• Technological Developments
• £1.1bn from future healthcare applications
• £5bn from smart city infrastructure, services and smart energy
• £10bn from the Internet of Things/Industry 4.0
• Unlocks £28bn in 5G benefits.

Direct Economic impact from network construction

• Drive £2.1bn GVA
• Create close to 7000 temporary jobs, predominantly in the construction and civil engineering industries.

Environmental Impact

• Saving 2.3m tonnes of CO2
• Worth £160m

About Regeneris

Regeneris Consulting is an independent economics consultancy operating across the UK and internationally for private and public sector clients. We provide economic and social insight to help our clients make better decisions and have a positive impact on people, places and the economy.

About CityFibre

CityFibre is the UK’s leading alternative provider of wholesale full-fibre network infrastructure. With dense duct and fibre footprints in over 40 cities throughout the UK, it provides a portfolio of active and dark fibre services to its customers which include service integrators, enterprise and consumer service providers, local authorities and mobile operators. CityFibre has begun a roll-out of Fibre-to-the-Premises in a strategic partnership with Vodafone, targeting 5 million homes and businesses by 2025. CityFibre is based in London, United Kingdom, and its shares trade on the AIM Market of the London Stock Exchange (AIM: CITY). www.cityfibre.com