FI-PPP: Heads up on the European Internet Industry and Market

posted 22 Jul 2011, 06:05 by Michael Boniface   [ updated 15 Aug 2011, 04:18 ]

The FI3P study has published a their second report providing a quantitative and qualitative analysis of the European Internet sector and its foreseeable evolution in the period 2010-2014. The results are based on data and knowledge of the ICT sector, complemented by an in-depth analysis of the profile and strategies of the Top-100 European Internet industry actors. The report analyses the Internet’s role in Europe from three main dimensions including the European Internet Economy, the European Internet Industry and the European Internet market. The analysis of these dimensions shows the main cross-cutting trends shaping the evolution of the Internet in Europe and in the world such as Internet and the Cloud, The evolution of business demand, network infrastructure trends, the emergence of the Internet of Things based on M2M connectivity.

The report presents the main actors (see figure below) providing the technologies and services constituting the Internet infrastructures and enabling its use in Europe highlighting the importance and influence of the emerging web ecosystem. The web ecosystem is the most recent layer of the Internet value chain and the fastest growing. The definition of web ecosystem highlights that the relationship between providers and users is different from traditional industries, with high users involvement (the “prosumer” concept, the combined role of producers and consumers of content and services). To gain competitiveness in the Web ecosystem, EU actors need to overcome current bottlenecks and exploit web-based innovation, launch new services and applications and expand in new markets, within and outside Europe. The EC might help in supporting the development of open web platforms and removing regulatory barriers to new applications and services, a key issue in the recent SESERV paper on Legislative Tensions in Participation and Privacy.

The report concludes with a few key messages:
  • The interaction between technology innovation and demand evolution will be the major factor shaping take-up and adoption of the Future Internet.
  • A trend to watch is the development of Cloud Computing: penetration in 2009 was only 2% penetration in Europe, but the expected growth rate (CAGR) over the next 4 years is 39%. The question is whether or not Cloud Computing will be adopted widely by small enterprises and government organizations, thereby opening a new market for advanced IT applications.
  • The balance between stakeholders governing the Internet is shifting, and this may have unforeseen consequences. Commercial players and users will have a much greater say in the governance of the Internet, while the small community of technology developers will see its influence reduced.
  • A possible consequence of a greater influence of commercial players can be seen in the debate around Net Neutrality, which may result in tiered fees structures for Internet traffic, privileging business traffic. But also the growing attempts by many governments to build fences and barriers around parts of the Internet may put at risk the openness and universality of the current Internet environment.
All details on the methodology, statistical tables, main technology trends and TOP 103 Internet industry suppliers profiles are also available