Digital economy 'worth €11.3bn'

Ireland’s digital economy could create thousands of jobs and expand businesses over the next four years if the country can get its technology strategy right, a new report has said.

Research from TV and telecoms provider UPC found that there are significant opportunities for businesses taking advantage of new digital developments, with an added bonus for the economy.

According to the report, if current trends continue, the internet will contribute €11.3 billion to the Irish economy in 2016, up from €4.7 billion in 2010. That means it will account for 6 per cent of GDP by 2016, a doubling of the current figure.

This could lead to as many as 18,000 jobs being created if Ireland can emulate the UK in digitisation; the figure could rise further if we could match the level of Scandinavian countries.

Despite the recession, consumer adoption of digital technology has risen steadily, the survey found, indicating that growth in the economy may be driven by this sector.

Internet usage has risen considerably in recent years, from fewer than five out of 10 adults in 2007 to eight out of 10 today.

Take up of high speed broadband services matches the EU average, at around two thirds of homes, the survey said. Consumers surveyed rated broadband as the top utility they couldn’t live without in their home, ahead of electricity.

On an average day, broadband users spend 2.6 hours online, with shopping and social networking as the top two online activities for Irish consumers. Some 80 per cent of consumers said they research purchases online before buying in local stores, while 60 per cent use bricks and mortar stores for research before shopping on the internet.

Online shoppers are expected to spend up to €3.7 billion in 2012. By 2016, that will account for 7 per cent of all consumer spending at €5.7 billion, the research said. Around three quarters of those surveyed said the internet allowed them make “smarter” purchasing decisions, and more than half said they wouldn’t be able to buy much of what they wanted without the internet.

Meanwhile, a third of adults work from home in some way, with 46 per cent of 35- to 44-year-olds reporting such arrangements.

“Although most are using it for ‘bandwidth-lite’ activities such as checking email, a minority are also using it for more collaborative work such as videoconferencing and report preparations,” the survey said.