Why the North East must take a lead on digital connectivity

Policy: Jonathan Walker, the North East England Chamber of Commerce’s assistant director – policy, on the tremendous prizes on offer both to those who can crack digital policy puzzles and regions that embrace a culture of digital investment and innovation

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From manufacturers to accountants and printers to coffee shops, there are few business sectors that exist today for whom digital connectivity isn’t an integral part of the way they operate.

Whether it is something as simple as the ability to take contactless payment or full-scale automation of production processes, modern businesses rely upon fast and reliable connections.

Unfortunately, despite investment by successive governments and much heralded broadband roll-out schemes, the UK is still playing catch up with many other countries.

Taking average download speeds as just one measure of this, research in 2018 ranked the UK at 35th in a list of 200 countries; far behind Singapore, the Scandinavian countries and the USA among others, according to a report by M-Lab and Cable.co.uk.

Plans are in place to improve this, with Government aspiring to have 15 million households connected to full fibre-to-the-premises (FTTP) networks by 2025, with universal coverage by 2033.

This is to be welcomed, although only if it doesn’t go the way of other non-binding Government aspirations by being quietly dropped after the next election or change of minister.

But for the country and our region to fully embrace and capitalise on the digital revolution we must think beyond just cables in the ground. We could have the best, most advanced and widespread infrastructure in the world, but if we don’t have the right mindset then we’ll continue to lag behind our competitors.

The Chamber has teamed up with Partner members Square One Law to look at what is needed to make the North East at hotbed of digital innovation and to improve the adoption of new technology among ‘non-digital’ businesses.

We’re conducting workshops with experts from a wide range of backgrounds to understand what barriers exist to improving connectivity in the North East and examining the best examples of firms that have placed digital at the heart of their business strategy.

We’ll be publishing our findings and recommendations with the aim of changing perceptions about the North East’s potential for investment in digital, putting digital at the heart of economic decision making and hopefully shifting attitudes among businesses who are not capitalising on the benefits new technology could bring to them.

There is no escaping how important this issue is to our region’s economic future. Fundamentally, digital connectivity needs to be seen as a vital utility; by businesses and policy makers alike.

In this regard, the market for digital infrastructure is perhaps less mature than it is for utilities such as water and electricity, which are seen as essential foundations of our society and are taken for granted.

At a strategic policy level, the balance between public and private sector in terms of who pays for new infrastructure seems to vary from minister to minister and initiative to initiative. There is also a tension between investment in super-high speed connectivity in some areas versus universal, but lower quality, coverage.

Similarly the planning system can seem outdated and out of touch when it comes to ensuring areas have the right digital connections; whether they come from a fixed cable or mobile networks.

We believe there is a tremendous prize on offer both to those who can crack these digital policy puzzles and to regions that embrace a culture of digital investment and innovation.

The North East is a region well suited to doing just that. On the infrastructure front, we can play a role in improving national digital resilience through new undersea cable connections to Europe and North America, rather than relying on networks concentrated in London and the South East.

This in turn has the potential to improve our region’s attractiveness to investors. In industries and sectors where speed of data transfers, or sufficient capacity to move large amounts of data are paramount, the ability to locate close to state of the art infrastructure is hugely appealing.

The low cost of both doing business and living in our region makes us highly competitive against areas such as London. Many digital businesses can be located anywhere, providing they have the right connectivity and supply of skills. We
have already seen a number of successful tech start ups in our region led by entrepreneurs who have left London or other global cities yet we can do more to ensure they keep coming.

Our work will also look beyond the competition to play host to the next big thing in tech (although we should ensure the conditions are right for us to do so) and will examine how every business in the North East can integrate digital technology into what they do.

While there are a great many examples of firms in the North East that do just this, unfortunately lots of firms either don’t see the benefits of digital investment or are simply unaware of what benefits this could bring.

Committing to overhauling your work practices through adoption of new technology is a big step and requires leadership from the very top of the business. Too often IT is seen as a discrete function in a company rather than an enabler for what everyone else wants to achieve.

A better understanding of the capabilities of tech and translation of what this means for the bottom line is needed; both within businesses and between the digital and non-digital business communities.

We’re not alone in wanting to be a world leader in digital. Cities and regions across the country and around the globe have these ambitions. But that doesn’t mean the North East shouldn’t think big.

The rate of change in tech is so fast that places need to have the right mix of infrastructure, people and aspirations to either catch waves at just the right time or be the place where the wave starts in the first place.

We’re really looking forward to getting to grips with these issues and to working with businesses, policy makers and tech experts to understand what more the North East can do to become one of those places, and hopefully playing our role in helping to make those aspirations a reality.