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UK internet economy booms

News, 12 December 2014

LONDON: The UK's internet economy is one of the strongest in the world, according to new figures from regulator Ofcom, but the popularity of social networking sites has dipped sharply in the past year.

The International Communications Market Report 2014, which examines take-up, availability, price and use of communications services across the world's major countries – including the UK, France, Germany, Italy, Spain, Australia, the US, China and Japan – found that the UK had the highest e-commerce spending among the major nations surveyed.

Consumers paid almost £2,000 on average online for goods last year. This was significantly more than the second-highest market, Australia, where people spent £1,356 per head.

Further two-fifths (40%) of advertising spending in the UK was online, more than any of the other countries analysed.

This state of affairs has been made possible in part by the high level of superfast broadband coverage, to which nearly 8 in 10 UK homes have access. "The internet has never been more important to the lives of people in this country, and the demand for better connections keeps rising," said Ed Richards, Ofcom chief executive.

The report also highlighted some significant shifts in how consumers are using the internet, with the proportion accessing weekly what might be termed 'traditional' social networking sites falling from 65% in September 2013 to 56% in October 2014.

The same trend was observed to a lesser extent in the US, Japan and China, and Ofcom attributed this development to the rise of other social media which do not involve networks of connections, such as online video sites and instant messaging.

But the French, Italians and Spanish all said they were doing more social networking this year than last.

In any case, social networks remain the most popular internet activity for smartphone users. Among all those who access the internet on their phone in the UK, 64% use social networks, ahead of the next most popular activity of reading online news (44%).

Data sourced from Ofcom; additional content by Warc staff