The British Speed Up

Things are changing in Britain. Routemasters, the beloved red double-decker buses that have crisscrossed London streets for the past 50 years, are no more, but soon there will be more high-speed Internet connections than anywhere else in Europe.

"Thanks to government efforts, Internet access overall is widespread — 56.7% of the entire population now is online," says James Belcher, eMarketer Senior Analyst and author of the new UK Online report. "The UK is wired, and getting more so all the time. In fact, its on the way to being the top broadband country in Western Europe in the next three years."

High-speed Internet access in the UK has surged in the past year, and a majority of users now are on broadband connections of some sort. As users switch away from dial-up, or get Internet access for the first time, most now connect at speeds over 512 kbps.

"As a percentage of online users, eMarketer projects that the UK will catch up with the US by 2008," says Mr. Belcher.

A larger broadband audience is important for marketers. Greater bandwidth allows access a variety of different communication and entertainment applications that are otherwise inaccessible or sub-standard when utilized at lower bandwidths.

"British users are getting more comfortable with completing transactions on their high-speed connections, and that's making for robust growth in e-commerce," says Mr. Belcher. "As users gain even more experience, they buy higher-ticket items on the Web—even to the detriment of some physical High Street retail stores."

Not only are more people shopping online, they are spending more as well. Annual online spending per person is up almost £ 100 this year, to £ 1,025.

The same information-gathering prowess used in shopping online is driving usage of e-government functions. Six in ten UK citizens looked for government information online this year. Queuing up to deal with bureaucracy soon may be a thing of the past, with voter and car registration, ticket and tax payment, and benefits enrollment all moving online.

"These private and public uses of the Internet underscore its legitimacy as an advertising medium," says Mr. Belcher. "Online ad spending is growing, and it is the way to reach young, well-educated, and affluent customers in particular. For those who have been waiting for a sufficient audience to create an online campaign, it's time to begin."

Article from www.eMarketer.com, 20 December 2005.