Internet economy to grow at a rate of 8 % annually in developed countries – to hit USD 4.2 Trillion by 2016
Internet as a communication and information medium is considered as most appealing innovation of 20th Century. Since its commercial inception during early 90’s, the Internet has not stopped growing. The way it has embedded itself in our daily lives, the Internet has become simply indispensible.
The impact of Internet has gone beyond daily life businesses, it is now considered as an important tool towards economical growth for economies giving birth to a new type economy titled as ‘Internet Economy’. As per its definition, The Internet Economy is an economy that is based on electronic goods and services produced by the electronic business and traded through Internet. It also refers to conducting business through markets whose infrastructure is based on the Internet and World-Wide Web.
According to a latest study released by Boston Consulting Group, the Internet economy will reach $4.2 trillion in the G-20 economies by 2016. The “Internet economy” will grow at a rate of eight percent annually in developed countries and more than twice that in developing markets. India, along with Argentina will grow the fastest at 24 percent and 23 percent respectively, while leading developed markets Italy and the U.K. will grow approximately 12 percent and 11 percent per year respectively, says the report.
According to BCG, if it were a national economy, the Internet economy would rank in the world’s top five, behind only the U.S., China, Japan, and India, and ahead of Germany. Across the G-20, it already amounted to 4.1 percent of GDP, or $2.3 trillion, in 2010—surpassing the economies of Italy and Brazil. Asian nations including India and China are set to drive unprecedented levels of internet-related economic growth among G-20 countries in the next four years, although the UK will remain at top spot.
Interestingly, according to the study, Internet has become so essential in everyday life that as many as 36 per cent of Indian online consumers said they would forgo showering for a year in order to keep Internet access, around 64 per cent said they would forgo chocolate; 63 per cent coffee; and 70 per cent would give up alcohol.
The report further said had it (Internet) been a sector, it would have been the eighth largest sector in India, larger than mining and utilities.