UK has the 6th largest internet economy
UK 6th in the world
A report commissioned by Google has revealed that the UK’s internet economy is worth £100 billion. The Connected Kingdom was conducted by Boston Consulting Group, and concluded that the UK has the 6th largest internet economy in the world.
Consumption accounted for £59 billion of the total, including online trading and shopping, and the cost of connections and devices. The rest of the £100 billion is made up of investment in the internet infrastructure and government spending. The grand total puts the internet ahead of the transport, tourism and construction industries in terms of value.
Research also revealed that the internet accounts for 7.2 per cent of the UK’s GDP in 2009, but this is set to rise. The report estimates that the industry’s share of the economy will increase by around ten per cent each year, reaching a GDP of ten per cent by 2015. Internet businesses directly employ 250,000 people in the UK, and see annual revenues of around £50 billion.
B2B not included
However, the report added that “since many of these companies sell to other businesses, this amount is not comparable to our GDP calculation”. B2B e-commerce and online advertising are therefore not included in the final figures; the report reveals that B2B transactions totalled £360 billion in 2008, and online marketing was worth £3.5 billion in 2009.
BCG partner Paul Zwillenberg told the BBC, “Several industries – including media, travel, insurance and fashion – are being transformed”. The positive effect of the internet and online advertising on the commercial and offline economy is discussed in the report, but unfortunately cannot be measured.