High speed broadband could boost e-commerce by £1.4bn

The Digital Britain high-speed broadband initiative could boost British e-commerce by £1.4bn, according to the Institute of Practitioners in Advertising (IPA).

If the Government’s Digital Britain Universal Service Commitment (USC) to ensure that every home in the UK has access to 2Mbps broadband by 2012 goes ahead, an additional £1.4 billion revenue may be generated through website sales. 

Figures from the Office of National Statistics (ONS) show that while website sales totalled £104.7bn in 2008, 4.9% of UK internet users were still relying on slow dialup connections.

The IPA’s Search Group has revealed that users with a high-speed internet connection are 36.9% more likely to buy online than those using a low speed internet connection.

Under the Government’s USC strategy, the 4.9 per cent of dialup users would be provided with a much faster connection, which the IPA says would boost conversion rates and increase online sales.

Rob Taylor, Founder, TST Digital, who carried out the research on behalf of the IPA Search Group, says the Government’s Digital Britain Initiative, which would provide high-speed broadband for users with slow connections is a “great opportunity to drive economic growth and competitive advantage.”

Nigel Gwilliam, head of digital at the IPA, says access to broadband fundamentally changes internet behaviour but warns that the forecast increases in e-commerce revenue will largely be at the expense of the bricks and mortar businesses.

He adds that it will increase the ability of newly emerging companies to build a business.

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