Small and medium-sized businesses in the UK are wasting money every day through old fashioned computing practices which are costing up to £18bn annually, according to web hosting firm Fasthosts.

The company said that the minimum requirements for SMEs running an in-house server are a power failure system to ensure the server can be shut down safely in case of an emergency; SDSL internet connection for maximum upload speed; a remote control card for access to the server from outside the office; a firewall for security as well as additional considerations such as air conditioning; physical security and remote back up.

The cost for these requirements quickly adds up and affects the bottom line on an ongoing basis, the hosting firm claims. If these systems are not properly implemented, the future of any small business can be at risk.

Small businesses in London have a very low three-year survival rate at 62.8 per cent, in contrast to Northern Ireland (72.4 per cent), Wales (86 per cent) and Scotland (65.3 per cent).

Fasthosts believes that many small businesses in the UK host their server in-house because of the out-dated belief that this allows maximum access and security.

But the opposite is often the case, as hosting a server within the company requires careful consideration and preparation.

"In our experience many businesses are still stuck in a 1980s computing mentality," said Fasthosts chief executive Andrew Michael.

"They need to move and embrace new computing practices. It is impossible to put value on data so it needs to be kept under maximum security. Data is the lifeblood of any business."