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FTTH fiber optics and the digital transformation of SMEs: ISTAT’s snapshot

18 January 2024 | Insights, News

The digital transition of enterprises is an evolving challenge, and the latest Istat report “Enterprises and ICT” provides a detailed picture of the situation. In particular, it emerges that SMEs (enterprises with 10-249 employees) still have a long way to go in adopting digital technologies, with clear gaps compared to large enterprises.

In this context, the deployment of fiber optic connections FTTH (Fiber-to-the-Home), or as it would be better to say in these cases FTTP (Fiber-to-the-Premises), represents a crucial opportunity to accelerate business growth and competitiveness.

The Digital Intensity Index (DII) and the challenges for SMEs.

The DII, used to assess the level of business digitization, reveals that only 21.3 percent of SMEs reach levels defined as high in the indicator in 2023. In contrast, 68.1 percent of large enterprises exceed these levels. The main challenge for SMEs lies in activities that require specialized skills, such as data analysis and the use of management software.

Broadband and the speed challenge among small and medium-sized enterprises

Fixed broadband with speeds of at least 30 Mbit/s is used by 84.8 percent (82.8 percent in 2022) of firms with more than 10 employees, compared with 96.9 (96.1 percent in 2022) of larger firms. Even more distant are the shares for connectivity to at least 1 Giga, 13.2% and 30.1% respectively (in 2022 they were 13.2% and 27.1% respectively).

A figure this brings us to the reflection on the importance of speed for business connection. Speed that must make it possible to take full advantage of the full potential of new digital technologies, such as IoT, Artificial Intelligence, Cloud, Cyber Security. And this is where FTTH fiber comes in, which offers faster speeds than traditional connections and total stability and reliability, unlike 5G.

The key role of FTTH fiber optics

Having on several occasions explained the differences between an FTTC network and an FTTH network(see, for example, here), we find, also in this report, evidence of the extent to which FTTH fiber emerges as a key element in bridging the digital divide between SMEs and large enterprises. With high transmission speeds and unparalleled stability, FTTH offers enterprises the ability to adopt advanced services such as data analytics, artificial intelligence and cloud computing. Its implementation will give SMEs access to a new world of digital opportunities.

Enterprises and data analysis

The business landscape shows that 48.7 percent of enterprises with at least 10 employees use enterprise software, with a predominance in the implementation of enterprise resource planning (ERP) systems followed by customer relationship management (CRM) and business intelligence (BI) software. Specifically, 42.2 percent of enterprises have adopted ERP, 19.2 percent CRM and 14.3 percent BI software. However, only 14.3 percent actively share data electronically with suppliers or customers within the supply chain in 2023, highlighting a challenge in digital information integration.

The correlation between connection and sectors

The report highlights the positive correlation between connection indicators and certain sectors. Enterprises in the information and communication services, energy supply and technical professions sectors are at the forefront of the adoption of advanced digital technologies. FTTH fiber thus becomes a prerequisite for businesses that intend to become or remain leaders in their respective fields.

Digital transformation of enterprises is a priority, and the Istat report highlights the urgent need for targeted interventions, especially for SMEs. While today it is mainly large corporations and specialized professionals that require ultrabroadband connections to be activated, the vertically growing numbers of adoption of technologies such as artificial intelligence tell us that soon any industry will not be able to do without the performance and reliability of FTTH.

Investing in this technology is a strategic choice that can position businesses competitively in the ever-changing digital landscape.