October 28, 2010

Internet Income Accounts For Over 7 Percent Of UK GDP

A new study sponsored by the UK branch of technology giant Google has discovered that the Internet contributed 100 billion pounds, or nearly $158 billion, to the British economy last year.

In other words, the World Wide Web accounted for approximately 7.2 percent of the entire gross domestic product in 2009, according to research completed by the Boston Consulting Group (BCG).

Furthermore, as BBC News reported on Wednesday, that would make it the fifth largest economic sector in the UK--larger than the construction, transportation, and utilities industries and nearly twice as large as the hotel and restaurants market, according to the Guardian.

By 2015, the Internet is expected to account for one-tenth of the country's GDP, according to AFP. That would make it larger in sheer dollar value than the UK's financial sector.

In the report, which is entitled 'The Connected Kingdom: How the Internet is Transforming the UK Economy,' authors Carl Kalapesi, Sarah Willersdorf, and Paul Zwillenberg write that the country is currently "the largest per capita e-commerce market" in the world.

They note that 62 percent of all adults (approximately 31 million people) in the UK purchased goods or services online in 2010, with total online sales from the year before topping 50 billion pounds, or nearly $79 billion.

"The internet is a central pillar of the UK's economy," Matt Brittin, the managing director of Google UK, told BBC News. "The sector has come of age, and with great prospects for further growth the UK internet economy will be vital to the UK's future prosperity."

"The Internet is pervasive in the UK economy today, more so than in most advanced countries," Zwillenberg, managing director of BCG's London office, added in an interview with AFP. "Whether they are driving international expansion, improving their interactions with customers or the efficiency of their supply chains, UK companies are increasingly embracing the Internet's potential."


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