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INTERNET USER FORECAST BY COUNTRY
An Estimate and Forecast of Internet Users in 57 Countries and 6 Regions of the World.


1.0 Executive Summary
1.1 Internet User Driving Forces
1.2 Wireless Internet User
1.3 Leading Countries by Internet Users

1.0 Executive Summary

The Internet began as a university research project in 1969 and was funded by ARPA—a U.S. military research organization. For the next 20 years the Internet and its predecessor, the ARPANET, existed mostly in obscurity. It was primarily a network for government and academic researchers during this timeframe. The defining event of the Internet happened in 1989 when Tim Berners-Lee proposed the World Wide Web. A year later the web became a reality when the first primitive web browser was implemented. The release of the free Mosaic browser in 1993 and the Netscape browser in 1994 allowed millions of PCs already in use to quickly and inexpensively get on the Internet.

 

At the end of 1989, there were 1.1M Internet users worldwide and about 86% were in the U.S. In the 1990s the worldwide number of Internet users grew 250-fold to over 290M for a compound annual growth rate of over 74%. The growth in the number of U.S. Internet users is slowing due to the high level of penetration. The worldwide number will grow at a stronger rate due to lower penetration levels in many regions. The next table summarizes the growth in U.S. and worldwide Internet users over the last 20 years.

 

Table 1.1 U.S. & Worldwide Internet User Growth

 

1985

1990

1995

2000

2005

2009

2010

2015

U.S. Internet Users (#M)

0.019

1.80

28.1

135

198

245

254

288

U.S. Internet User share (%)

89.6

84.5

62.3

31.3

18.1

13.4

12.5

10.0

U.S. Internet Users/1,000 People (#)

0.08

7.2

105

477

668

797

820

885

Worldwide Internet Users (#M)

0.021

2.13

45.1

430

1,094

1,825

2,030

2,890

WW Internet Users/1,000 People (#)

0.004

0.40

7.94

70.8

170

270

297

399

 

At the end of 2000 the U.S. had nearly 135M Internet users. Between 1990 and 1995 the compound annual growth rate of U.S. Internet users was over 73% and slowed to 36% between 1995 and 2000. From 2000 to 2005 the U.S. number of Internet users grew by 8% and will grow by less than 6% per year between 2005 and 2010.

 

The worldwide number of Internet users zoomed from 2.1M at year-end 1990 to over 45M in 1995, which is a compound annual growth rate of over 84%. From 1995 to 2000 the compound annual growth rate slowed to 56% and to less than 21% between 2000 and 2005 and to 13% from 2005 to 2010. For the next five years the worldwide number of Internet users is forecasted to grow by less than 8% per year.

 

The next figure shows the growth of Internet users for the main regions of the world. Six regions and the U.S. Internet user totals are listed in the bar graph. The estimates show that Asia Pacific became the largest region with 193M Internet users in 2001, which will grow to over 1.4B Internet users in 2015. Western Europe with 355M Internet users in 2015 will also top the 288M Internet users forecasted for the U.S. The Middle East/Africa region will have the strongest Internet user growth at over 297M in 2015, from 156M+ in 2010 and from less than 13M Internet users in 2000.

 Figure 1.1 Internet Users by Regions

Increasing usage of wireless web devices will cause much of the Internet user growth—especially in the developing countries. In 2005 less than 22% of Internet users were using wireless devices to access the Internet—up from less than 1.7% in 1999. A large portion of the wireless web users is currently in Japan, S. Korea, China, USA and W. Europe. In the next five years the growth of wireless Internet users will grow from less than 38% of all Internet users in 2008 to over 64% in 2015. Many of these users will be using multiple Internet access devices.

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1.1 Internet User Driving Forces

There are numerous factors that are driving the growth of the Internet. The key driving forces are summarized in the next table. The left column shows important factors that have been active recently and will continue to add growth to the Internet. The right column lists the factors that are emerging and are likely to have a strong impact in the next five years.

Table 1.2 Internet User Driving Forces
1996-2007 2008-2015
  • Email proliferation
  • Free web browser
  • Content explosion
  • Under $1K PCs (1997)
  • Intranets for business users
  • Web hosting services
  • Business-to-consumer e-commerce
  • PC purchase rebates from ISPs
  • Business-to-business e-commerce
  • Declining & fixed ISP rates
  • Under $500 PCs (2000)
  • “Free” ISP rates in international markets
  • Web-driven productivity gains
  • Internet/cyber cafes
  • Business-to-business e-commerce
  • Cable modem & DSL Internet connections
  • Home networks for Internet access device
  • Broadband connections:  DSL, fiber & others
  • Handsets with Internet access
  • Internet access via wireless access points
  • Internet-enabled consumer electronics devices
  • Multi-function handheld devices*
  • Web content for wireless/handheld devices
  • Un-metered Internet access fees
  • Prepaid Internet access cards
  • E-commerce in developing countries
  • M-commerce (e-commerce for mobile devices)
  • Social network websites (Facebook etc)
  • Netbook PCs ($200-$400)
  • Internet entertainment content
  • $50 handset with Internet access
  • Location-based content
  • Smartphone apps for Internet access
  • Low-cost mobile broadband data plan

*Smartphones, handsets, media players and others

Low cost Internet access devices will continue to be a leading Internet user growth factor. A low cost PC in the $200 range is needed for the developing countries. It is sometimes called the “Hundred Dollar Laptop” which is the estimated manufacturing cost. The netbook PC is now taking its place and is seeing strong growth during the current worldwide recession. After 2010 such a product may be in the $150 range. Of equal importance is the $50 web-enabled handset, which is now available.

“Free” ISP rates are usually not free. They are used in countries where all telephone call fees are based on usage rates. The ISP offering “free” Internet access receives a share of the per minute telephone charge from the telephone company. However, un-metered Internet rates or a fixed monthly rate for unlimited use are becoming important—especially with broadband Internet connections. Un-metered rates will become increasingly important, as free ISP rates have peaked in importance.

Broadband Internet access such as cable modems and Digital Subscriber Lines (DSL) are growing rapidly and will have a positive impact on the user experience. Fiber optic broadband connections are also emerging and will take a growing share. The U.S. has been slow to add broadband infrastructure and Canada, Japan, S. Korea and other countries have much higher broadband penetration than the U.S. DSL technology is the leading broadband technology in most countries because it uses the existing telephone network infrastructure.

The emerging 3G and 3.5G cellular technologies will be very important due to its “always-on” characteristics. 3G cellular networks is a great improvement over current transfer rates. Current 3.5G networks have multi-megabits per second transfer rates. Higher maximum speeds are emerging and these upgrades are often called 4G. However, due to multiple users sharing this bandwidth in each cell, the average bandwidth for each user will be much lower than the maximum rate.

Several other broadband technologies may also have an impact on Internet access. Wireless LANs (Wi-Fi or IEEE 802.11) use an unlicensed frequency band in the 2.5 GHz range for local wireless communication to mobile devices. The growth of wireless access points that provide broadband Internet access to mobile devices using IEEE 802.11 protocol is currently seeing strong growth. WiMax or IEEE 802.16 is an emerging wireless technology that shows future potential for broadband connectivity. WiMax has a much larger range than Wi-Fi and will compete with 3.5G and 4G cellular networks.

Internet-enabled consumer electronics devices will have a growing impact on Internet usage. An increasing number of 3G cell phones will have Internet access capabilities and will extend the time and place of Internet access. Web-enabled handsets will also extend the number of Internet users—especially in developing countries where fixed phone lines are limited. Web appliances and web-entertainment appliances will also extend the time and place of Internet access.

The rapid growth of Smartphone as Internet access devices in the last three years show the potential of mobile devices for Internet access.  It is likely that Smartphones will surpass the PC as the leading Internet access devices sometime after 2015.

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1.2 Wireless Internet User

The wireless Internet was perceived as a disappointment due to earlier inflated expectations a few years ago. By 2006, the wireless Internet had only lived up to expectations in Japan and S. Korea. In the last two years the wireless Internet has taken off in the USA, W. Europe, China and other regions. The Apple iPhone deserves much of the credit since its user interface made it much easier to access Internet content. Other mobile phone manufacturers followed and the mobile phone Internet access is now growing very fast.

The importance of the wireless web is shown in the next table. It is important to note that most of the wireless Internet users are also using the Internet via PCs.

Table 1.3  Wireless Internet Users

Region   2003 2006 2009 2010 2015
USA Internet Users (#M) 174 210 245 254 288
Wireless Internet Users (#M) 12 26 85 105 196
Wireless Internet User Share (%) 7.2 12.4 34.5 41.2 68.1
Worldwide Internet Users (#M) 827 1,238 1,825 2,030 2,890
Wireless Internet Users (#M) 143 301 778 955 1,848
Wireless Internet User Share (%) 17.3 24.3 42.6 47.0 63.9

The wireless Internet is making progress with the deployment of 3G and 4G-packet communication networks. Packet networks are always on, which eliminates the lengthy log-on procedure. Useful Internet content for the small displays of wireless devices is expanding and simpler user interfaces are now available. As the wireless Internet user experience improves, an increasing portion of the dormant web-enabled phones will become active wireless Internet devices.

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1.3 Leading Countries by Internet Users

The worldwide number of Internet users passed 130M in 1997 topped 1B in 2005 and surpassed 2B in 2010. Much of the growth in Internet users is taking place outside the U.S. Asia will see especially strong growth in the next five years. China surpassed Japan and became second to the U.S. in number of Internet users in 2002 and became #1 in 2008. At the end of 2000 the U.S. accounted for 31.3% of total Internet users, down from 44.6% in 1998 and 55.7% in 1996. U.S. Internet user share dropped below 20% in 2004 and below 14% in 2009. The next table is the estimated country ranking of Internet users for year-end 2009.

Table 1.4 Top 15 Countries in Internet Users: 2009

Internet Users (#K) Year-End 2009 Share %
1. China 310,900 17.03
2. U.S.  244,780 13.41
3. India 125,110 6.85
4. Japan 102,320 5.61
5. Germany 60,360 3.31
6. Brazil 51,130 2.80
7. UK 47,010 2.58
8. Russia 43,020 2.36
9. France 42,880 2.35
10. Italy 40,050 2.19
11. Indonesia 38,410 2.10
12. South Korea 38,260 2.10
13. Mexico 27,760 1.51
14.Canada 27,120 1.49
15. Spain 25,220 1.38
Top 15 Total 1,224,330 67.07
Worldwide Total 1,825,409 100

PCs remain the leading Internet access device, but other Internet enabled devices will grow in importance. Mobile phones are and will continue to be the most important Internet appliance device. By 2015 Internet-enabled mobile phones may approach the number of PCs used for web access. However, most Internet users will be accessing the web from both PCs and web-enabled cell phones and Internet-enabled consumer electronics devices.

The next table shows the estimated number of Internet users per capita for leading countries at year-end 2009. The Scandinavian, N. American and W. European countries are the leaders plus a few Asian countries such as Australia, New Zealand, Singapore, Japan and S. Korea. Japan and S. Korea have moved up due to rapid penetration of web cell phones.

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Table 1.5 Top 15 Countries in Internet Users Per Capita: 2009
Internet Users Per 1,000 People Year-end 2009
1. Iceland 847.7
2. Sweden  837.8
3. Norway 828.2
4. Denmark 823.6
5. Singapore 811.5
6. Canada 810.0
7. Australia 809.0
8. Japan 805.2
9. Hong Kong 803.7
10. Netherlands 801.0
11. Finland 800.0
12. New Zealand 797.5
13. USA 796.8
14. South Korea 788.7
15. UK 769.2
Worldwide Total 270.3

In the next 10 years the Internet will have a dramatic impact on every facet of our lives. Most of the industrialized world will be using PCs, mobile phones and information/web appliances for Internet access. Many households in industrialized countries will have multiple web access devices and some will have multiple PCs that will manage and synchronize all the information that flows to and from the Internet. Smartphones, mobile phones and small form-factor PCs will proliferate and will attract a large number of mobile Internet applications and services. The developing countries will also have made tremendous strides in using the Internet. The wireless Internet devices will be especially important in the countries that have limited land-based telecommunications infrastructure. A speculative but reasonable 2015 scenario for Internet access devices is shown in the next table.

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Table 1.6  Internet Access Device Scenario: 2015
USA Worldwide
1. In 2015 there will be over 288M Internet users
2. In 2015 there will be over 336M PCs in use
3. Over 80% of office workers use PCs
4. Over 95% of households will have PCs
5. There will be over 330M cell phones in use
6. There will be 196M wireless Internet users
1. In 2015 there will be over 2.8B Internet users
2. In 2015 there will be over 1.95B PCs in use
3. Over 65% of office workers use PCs
4. Over 50% of households will have PCs
5. There will be over 5.5B cell phones in use
6. There will be 1.85B wireless Internet users

Most of the Western European countries, Canada, Australia, New Zealand, Japan, Taiwan, Singapore and South Korea will have penetration scenarios similar to the U.S. for 2015.

It is reasonable to predict that the Internet and Internet access devices will have a bigger impact than the combined effect of the phone, TV and PC in the next 10 to 15 years.

The price of the single user version of this report is $1,950. A site license or multi-user version of this report is $3,100. The report can be sent via email as a MS Word document and an Excel spreadsheet. The spreadsheet forecast can be modified, as additional data becomes available. Updated yearly. Go to Order Form.

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