Europe could soon leapfrog the US in Internet commerce, according to a senior industry analyst.
The gap between the US and Europe in Web usage has narrowed so much over the past year that the US is ahead by only a few months, calculates IDC analyst, Frank Gens.
The number of European Web sites have also doubled during the period, although it is the larger businesses in Europe that are tending to lag behind.
Regionally, there are considerable differences within Europe. IDC sees the global number of Internet commerce buyers increasing from 97 million in 1998 to 320 million in 2002, with the European share growing slightly from 19 per cent to 23 per cent.
According to IDC, Internet usage in Europe is greatest in the Nordic countries, but lags in France and Italy. Germany leads in online purchasing, with Italy enjoying a particularly high percentage of Net buyers. The UK is in the middle. However a trend is that once a user begins to shop online, they get hooked.
Business-to-business transactions will continue to dominate, increasing from 66 per cent to 79 per cent. The Web commerce market will leap from $32 billion to $425 billion between 1998 and 2002. This contrasts with the global economy, where 61 per cent is spent on consumer spending rather than business spend.
Ecommerce is not currently profitable at a macro level. IDC estimates that online costs are $17 billion and sales only $32 billion. However, by 2002, it believes the ratio will change to costs of $32 billion and sales of $426 billion.
Looking at US data, IDC believes appliances used to shop on the Internet will increase from some four per cent to 43 per cent over the next four years, leading to a decline in the dominance of the PC.
There is great uncertainty as to which software supplier will win here. Around 25 per cent of the US respondents polled by IDC believe Microsoft will control the market, compared to only 10 per cent of Europeans surveyed. IBM was mentioned by around 10 per cent of people, as a result of its recent marketing blitz.
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