UK internet businesses

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UK Internet businesses are based in the UK and address the UK or world market for goods or services, using the Internet to deliver services or as their main marketing channel, or provide Internet technology from the UK.

Contents

[edit] Broadband market

More than half of UK homes had broadband in 2007 with the average connection speed being 4.6MBit/s. Bundled communications deals mixing broadband, digital TV, mobile phone and landline phone access had been adopted by 40 per cent of UK households in the same year, up by a third over the previous year. This high level of service is considered the main driver for the recent growth in online advertising and retail. [1]

In 2006 the UK market was dominated by 6 companies, with the top two taking 51%, these being Virgin with a 28% share, and BT at 23%. [2]

The UK broadband market is overseen by the watchdog Ofcom. According to Ofcom's 2007 report the average UK citizen uses the Internet for 36 minutes every day. See Register editorial and the complete report

[edit] Search Engines

Google has a localized UK service, www.google.co.uk, and is the major presence in the UK search market with a 79% market share - literally ten times the size of its nearest competitor. Google's UK service includes a UK dedicated version of Google Product Search. [3]

[edit] Online Advertising

Expenditure on internet advertising reached £2bn in 2006, equivalent to 44 per cent of TV advertising. [4] [5]

[edit] Online Retailing

Total online retail spending online grew by 33.4% in 2007 to a record £10.9bn. UK online sales are predicted to reach £28.1bn by 2011 - 8.9% of all retail sales. [6]

An attempt at a complete list of UK retailers maybe be found here.

Evidence exists that the UK's online retail market is especially weather dependent, with bad weather significantly increasing online sales, see Heavy rain causes 80% increase in online sales.

The UK has a localized version of ebay.

Relatively high UK prices are often a special factor in UK online retail - see Rip-Off Britain. Many businesses attempt to undercut what are seen as especially high UK prices in bricks and mortar stores; e.g. CD WOW! for CDs, TheHut.com and Play.com for CDs, DVDs, videogames and books, and Glassesdirect in the prescription spectacles business.

Businesses that are based on price under-cutting using grey imports run a special risk of legal action by suppliers attempting to maintain higher UK prices; see e.g. [7]

British consumers often use online auction sites or foreign Internet Retailers to order items like CDs, DVDs, and videogame console software. DVD players and consoles that have been adapted to by-pass regional lockout mechanisms are comparatively common in the UK. Details of related UK tax and import duties can be found [here].

[edit] Investment

€1.8bn (£1.2bn) was invested by venture capitalists in software and IT companies across Europe in 2006, with the majority - 31% - €558m – going to the UK. [8]


[edit] The UK Dotcom Bubble

The UK "Bubble" lasted from 1995 until 2000. [9] Iconic flotations made during this time included Lastminute.com and Autonomy Corporation. The business networking group First Tuesday had iconic status [10]. For examples of the collapse of Internet stock prices after the collapse of the bubble see this article from 2001