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Global Online Population To Hit 2.2 Billion By 2013

The number of people online around the world will grow more than 45 percent to 2.2 billion users over the next five years, according to a new report by Forrester Research.  Asia remains the biggest global Internet growth engine: 43 percent of the world’s online population will reside in Asia by 2013, with 17 percent of the global online population in China. Growth rates in the US, Western Europe, and the major industrialized nations in Asia Pacific such as Australia, Japan, and South Korea will slow to between 1 percent and 3 percent.

“While per capita online spending is likely to remain highest in North America, Western Europe, and the developed markets of Asia throughout the next five years, the shifting online population and growing spending power among Asian consumers means that Asian markets will represent a far greater percentage of the total in 2013 than they do today,” said Forrester Research Senior Analyst Zia Daniell Wigder. “Multinational organizations must understand the dynamics of the shifting global online population to ensure that they are positioned to take advantage of emerging international opportunities.”

The Internet user base is increasing in every area of the world. Regional highlights include:

• North America. Online penetration in the US is set to rise from 73 percent to 82 percent over the next five years, representing about a 3 percent annual growth rate. By 2013, US online penetration will be on par with the most highly penetrated markets of Europe and Asia, such as the Netherlands, the UK, Japan, and South Korea.
• Europe. Europe’s Internet growth will be fueled by the continent’s emerging markets. Internet usage in Russia and Turkey will grow by almost 8 percent annually, while growth in Spain’s online population will increase by an average of more than 5 percent each year.
• Asia. China’s online population (already the largest in the world) will rise by nearly 11 percent each year over the next half decade. Other Asian countries with substantial online growth rates include India, Indonesia, Pakistan, and the Philippines. By contrast, growth rates in some of the more mature markets such as Japan and South Korea will rise by less than 2 percent each year.
• Latin America. Brazil is currently the fourth largest market in the world in terms of number of Internet users, but despite a 7 percent annual growth rate over the next five years, it will drop to the No. 5 position in 2010 when it is surpassed by India.
• Africa and the Middle East. The countries of the Middle East and Africa currently represent just 8 percent of the global online population but over the next five years will see some of the highest growth rates in the world, around 13 percent. Egypt, Iran, and Nigeria are among the countries with the highest growth rates in the region.

Countries With The Most Internet Users: 2008

1. US

2. China

3. Japan

4. Brazil

5. Germany

Countries With The Most Internet Users: 2013

1. China

2. US

3. India

4. Japan

5. Brazil

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India Keeps Hiring

Almost 10% of SMBs (small and medium businesses with up to 999 employees) in India are planning to hire additional staff, according to a recent study by New York-based Access Markets International (AMI) Partners. “The hiring growth of 10% is substantially less than the previous year’s 50%,” says Kalyan Banga, Research Analyst at AMI-Partners. “However, it is still quite significant considering the global market’s current slowdown.”

In some areas of technology adoption, “Concerned MBs” are likely to show fewer adoption plans in this time period as they are adopting a “wait & see” attitude regarding future market conditions. However, it is interesting to note that in usage of some technologies (such as hosted CRM and SaaS adoption) these “Concerned MBs” show higher adoption levels than other SMBs.

“In the era of global recession SMBs feel that they need to maintain better customer relationship management to increase customer loyalty,” Mr. Banga says. “SaaS adoption also comes to the forefront since many SMBs are gradually awakening to the intrinsic advantages of SaaS – viz. lower upfront cost and TCO, less maintenance hassles, the ability to reduce IT staff, etc.” 20% of India SMBs indicate using hosted software applications to supplement internal IT resources will be a key strategic focus area for them in the next 12 months.

The impact of the current economic downturn on local/regional economies is of greater concern to small businesses than to their MB counterparts. Conversely these same SBs are not being as greatly affected by changes in the national and global economy as the mid-market firms. “A major reason for this is that most SBs (84%) have only a single location, earn almost three fourths of their revenues from local areas, and operations are mainly confined to local territories,” says Mr. Banga.

In addition to the economy, there are several major business challenges facing India SMBs today. More than two thirds of firms state that local competition is their greatest hurdle to overcome, followed closely by increasing customer satisfaction and loyalty, and improving employee productivity. India SMBs are looking for IT solutions to help address the current shortfalls. These findings are also corroborated in AMI’s latest quarterly tracking study, Impacts of a Game-Changing Economic Downturn: How to Market Effectively & Stay Competitive – India Small and Medium Businesses. According to this, 40% of IN SMBs are seeking to leverage technology to reduce costs/make processes more efficient and improve employee productivity. As a specific example, over half of IN SMBs are planning to improve processes or invest in training to increase employee productivity. Another key technology for India SMBs is CRM software – over one-third of SMBs are considering CRM usage to help them manage customer relationships and retain customers as a key strategic IT issue in the next 12 months.