Belfast Telegraph

Thursday 24 July 2014

Net's '£100bn boost' for UK economy

The internet is worth 100 billion pounds a year to the UK economy, a report has said

The internet is worth £100 billion a year to the UK economy, a report has said.

It represents 7.2% of the country's gross domestic product - more than the construction, transport and utilities sectors, researchers at US consultants Boston Consulting Group (BCG) found.

The share is also likely to grow to 10% by 2015, putting the internet's contribution on a par with the financial sector.

Around 60% of the £100 billion figure was found to come from internet consumption - the amount that users spend on online shopping and on the cost of their connections and devices to access the web.

The remainder arose from investment in the UK's internet infrastructure, government IT spending, and net exports.

Britain was also found to be a net exporter of e-commerce goods and services, exporting £2.80 for every £1 imported. In contrast the "off-line" economy exports 90p for every £1 imported, BCG said.

The report - which was commissioned by web giant Google - found that 250,000 people are employed by e-commerce companies in the UK.

Britain was also ranked sixth among the world's major economies in terms of an "e-intensity index" - a measure of the the reach and depth of the internet. That put the country above the likes of Germany, the US and France, but lagging behind Japan, South Korea and Holland. The highest ranked country was Denmark.

Altogether, BCG said more than 19 million UK households have an internet connection - a 73% share - with broadband penetration doubling since 2005.

Among the other findings, 31 million adults bought goods or services online in the past year, or 62% of all adults. Collectively, they spent about £50 billion last year on goods and travel.