Poor internet connectivity still stopping SMEs from getting online

Two-thirds of Irish SMEs now have a website and are increasingly using social media and data analytics to help grow their business. But a significant number of small firms are still struggling to get online because of poor internet connectivity.

A new study from IE Domain Registry (IEDR), the group responsible for the managing and maintaining of .ie domains online, shows that 14 per cent of SMEs rate their connection as either “poor” or “very poor”, a figure that rises to 24 per cent in Connacht and Ulster.

It also shows that nearly 20 per cent of SMEs that are currently offline cite poor connectivity as the primary reason.

IEDR’s study reveals that only 40 per cent of SMEs that have websites can take sales orders online, a 10 per cent rise when compared with the 30 per cent recorded six months ago but still below the EU average.

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The Digital Health index also shows that 63 per cent of SMEs do not promote their services online.

The study comes as IEDR reported a €103,331 pretax loss for 2016, down from a €414,697 loss a year earlier as turnover rose to €3.03 million from €2.86 million.

The body said while the invoice value of registration fees increased, reflecting new growth in 2016, an increasing proportion was accounted for by multiyear registrations and renewals. The deferred revenue increased by 4 per cent to €20.5 million from €1.97 million.

Volume growth in domains was strong in 2016, but year-on-year new registration growth decreased by 1.7 per cent, the directors said.

“When non-renewals are considered, the net decrease in the .ie namespace was 15.5 per cent, which is satisfactory in the context of the global retrenchment within the domain industry,” they added.

Administrative expenses for the IEDR fell by 4 per cent to €3.23 million last year with employment costs down 8.5 per cent to €1.34 million.

IEDR recently announced plans to liberalise the .ie domain process by dropping the need for applicants to prove a valid claim to a name. However, they must still prove they have a valid claim to the desired address and a tangible connection to Ireland.