Netmarketing

NetMarketing
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by Giancarlo Livraghi

gian@gandalf.it

No. 38 – August 22, 1999

Editorial: Growth and diversity
Numbers worldwide
Latin America

Summary

1. Editorial: Growth and diversity

This is the last in a bunch of three issues that are mainly about numbers. Issue 36 was about the situation in Europe; 37 reported research results on internet "users" in Italy; this is about online growth worldwide.

On a global scale, the internet grew 53 percent in the last twelve months; more than doubled in two years. There appears to be an acceleration in the last six months, but it's faster in the United States than in most countries.

76 percent of the internet is in North America, 14 percent in Europe, 6 percent in Asia and 4 percent in the rest of the world. The general picture isn't changing; nine tenths of the net are in ten countries, with eleven percent of the world's population. But there are some interesting developments; some countries are growing much faster than others. China tripled its presence in a year, Mexico doubled; Brazil, Argentina and the United States grew more than 70 percent.

There are other changes that don't appear in the general figures. In some countries (unfortunately not many) the net is spreading more widely in society; the difference between the "information haves and havenots" is beginning to decrease.

Every day there are a thousand new internet domains, five thousand new hosts, a million new pages on the web. The first impression is that it's becoming a "mass environment" – and, to some extent, that's true. But there is increasing diversity. We can forget nostalgia about how closely knit the net appeared five or more years ago, but there is still much to be found that is not the same as the homogenized standard offered by mainstream media – and a lot of it wasn't there yesterday. Diversity still is, and will continue to be, the distinctive quality of the internet.

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2. Numbers worldwide

The new survey by the Internet Software Consortium (Network Wizards), covering the first half of 1999, was published on August 18. These are the general hostcount data.

	Number of hosts	% growth
	Number of hosts	in six months	in a year
January 1995 *	5,846,000	51.1	118.9
July 1995 *	8,200,000	40.3	106.8
July 1996 *	16,729,000	16.6	104.0
January 1997 *	21,819,000	30.4	52.0
July 1997 *	26,053,000	19.4	55.7
January 1998	29,670,000	13.9	36.0
July 1998	36,739,000	23.8	41.0
January 1999	43,230,000	17.7	45.7
July 1999	56,218,000	30.0	53.0

* The survey methodology was changed starting January 1998. Figures for years 1995-1997 are asjusted to adapt the old criteria to the new. Percentages for 1995 over 1994 are based on the "old" data. Growth in January 1994 over a year earlier was 138 percent.

The growth trend is up-and-down, with a faster increase in the last six months. Let's look at an update of the graph that compares growth in Europe (RIPE data) and worldwide.

Growth trend of internet hosts

January 1995 = 100

Six-month periods (January and July of each year)
Anallysis on data by Network Wizards and RIPE (Réseaux IP Européens)

For several years the growth rate was almost the same, but now "the rest of the world" is faster than Europe. There is some relevant growth in several non-European countries, but what really makes the difference is an acceleration in the United States.

These are the figures for 37 countries (of 240 analyzed by Network Wizards) with over 50,000 internet hosts.

	Number of hosts July 1998	% change		% of total	Per 1000 inhab.
	Number of hosts July 1998	in six months	in a year	% of total	Per 1000 inhab.
United States	40,970,088	+ 34.4	+ 72.2	72.9	155.6
Japan	2,072,529	+ 22.8	+ 53.3	3.7	16.6
United Kingdom	1,599,524	+ 12.3	+ 34.3	2.9	24.4
Germany	1,426,928	+ 8.4	+ 23.6	2.5	17.2
Canada	1,294,447	+ 8.7	+ 26.0	2.5	42.9
Australia	907,637	+ 14.6	+ 21.0	1.6	50.2
France	653,686	+ 33.9	+ 51.7	1.2	11.3
Netherlands	637,591	+ 13.0	+ 23.9	1.1	43.1
Finland	577,029	+ 5.6	+ 12.4	1.0	112.8
Sweden	515,032	+ 19.3	+ 35.3	0.9	58.7
Taiwan	424,209	+ 37.4	+ 40.9	0.8	19.8
Italy	393,627	+ 16.2	+ 22.7	0.7	6.9
Norway	335,898	+ 5.4	+ 7.5	0.6	77.4
Brazil	310,138	+ 44.2	+ 89.2	0.6	2.0
Spain	302,457	+ 14.5	+ 24.2	0.5	7.6
Denmark	287,273	+ 2.7	+ 51.0	0.5	55.5
Belgium	272,876	+ 64.5	+ 77.5	0.85	27.0
Switzerland	264,426	+ 17.9	+ 26.7	0.85	36.7
Korea	260,146	+ 39.6	+ 48.8	0.5	5.8
Mexico	224,239	+ 99.1	+ 167.1	0.4	2.4
Austria	203,774	+ 66.1	+ 54.1	0.3	26.6
Russia	191,397	+ 14.7	+ 24.5	0.3	1.3
New Zealand	182.021	+ 32.6	+ 2.2	0.3	51.1
Poland	158,099	+ 45.6	+ 60.0	0.3	4.1
South Africa	140,470	– 2.8	=	0.3	3.4
Israel	114,192	+ 16.8	+ 30.3	0.2	20.3
Singapore	103,862	+ 54.9	+ 74.7	0.2	36.4
Argentina	101,833	+ 53.2	+ 77.0	0.2	2.9
Hong Kong	98,183	+ 18.6	+ 35.9	0.2	16.6
Hunghary	93,759	+ 12.3	+ 26.7	0.2	9.3
Czech Republic	87,976	+ 19.3	+ 34.0	0.2	8.6
China (excl, HK)	62,935	+ 264.7	+ 225.9	0.1	0.05
Greece	62,760	+ 21.8	+ 56.7	0.1	6.0
Portugal	59,338	+ 19.3	+ 29.3	0.1	6.0
Ireland	58,399	+ 6.4	+ 30.2	0.1	16.6
Malaysia	53,447	+ 11.7	+ 31.1	0.1	3.0
Turkey	51,295	+ 57.9	+ 84.1	0.1	0.8
Total	56,218,330	+ 30.0	+ 53.0		2.8 *

* "Gobal" density is calculated excluding the United States.

US domination is increasing. As usual, there are differences between these figures and those in the European survey (it's probably a matter of timing as well as methodology) but the broad pattern is not contradictory.

By geographic areas the picture is basically the same as we had seen in previous surveys.

Continents

Data by Network Wizards – August 18 1999

There are changes in some areas (for instance in South America and parts of Asia) but on a large scale the situation hasn't changed. There is still high concentration within each of the areas. 96 percent of the net in North America is in the US (3 percent on Canada, 0.5 in Mexico). 99 percent of the Pacific is in two countries – Australia and New Zealand. In Asia Japan still has "the lion's share", though it's down from 68 to 61 percent. 92 percent of Africa is in South Africa, 77 percent of Central-South America is in Brazil and Argentina. Only in Europe no single country has more than 20 percent; but 60 percent of the European net is in six countries.

The ever-increasing US domination is obvious in the next graph.

10 countries

Countries with over 400,000 internet hosts – Data by Network Wizards – August 28 1999

Note: in this graph, as in those following, the "slice" for France
is increased by a rough estimate of the minitel peculiarity.

For better readability of the graph, here is a picture of the 16 countries with over 300,000 internet hosts – not including the United States.

16 countries

Countries with over 300.000 internet hosts (United States excluded)
Data by Network Wizards – August 18 1999

At a glance, this may seem the same as in the past; but there are changes. For instance Brazil has overtaken Spain and is in this group for the firsts time; France is getting stronger even if we don't consider the minitel. Let's compare this with a "pie" based on the latest European data.

13 European countries

Countries in Europe with over 200.000 internet hosts
Data by RIPE – August 6 1999

Italy is looking a bit better here than it appears, so far, in the worldwide survey. But if we are to consider "the strongest economies worldwide", here is the situation in the "G8".

G8 countries

Data by Network Wizards – August 18 1999

The picture is pretty obvious. The next graph is even more relevant: an update on density.

Internet hosts per 1000 inhabitants in 28 countries

Countries with over 100,000 internet hosts – Analysis on data by Network Wizards

The green slice of bars is growth in a year, from July 1998 to July 1999.
The yellow slice in the bar for France is an approximate estimate of the minitelfsctor.

United States leadership is confirmed also in per-capita density. Finland is no longer the world leader, though Scandinavia remains the most active group of countries online. In Asia, Singapore and Taiwan are getting stronger.

Now let's look at the index in relation to income (GNP).

Internet hosts in relation to income (GNP) in 28 countries

Countries with over 100,000 internet hosts – Analysis on data by Network Wizards

As in the previous graph, the green slice of bars is growth in a year, from July 1998 to July 1999.
The yellow slice in the bar for France is an approximate estimate of the minitel factor.

The news here is US domination even in relation to income. Once again we see Japan and Germany rather weak in proportion to their economies. The picture is quite bleak as seen from Italy – though the latest European survey shows some improvement, bringing Italy close to the (not so wonderful) position of France if we don't consider the minitel.

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Let's look at an update of the world map by internet density.

There are some changes – for instance in Latin America – but we continue to see high concentration in a few parts of the world and very large "empty" areas. The road to "globality" is still long and uphill.

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3. Latin America

We had seen, six months ago, the situation in Spanish-speaking countries. Here we are taking a somewhat different perspective and considering Latin America – including Brazil.

There are the figures (17 countries in Latin America with over 500 internet hosts) according to the July 1999 survey.

	Internet hosts	% growth in a year	per 1000 inhab.
Brazil	310,139	+ 89	2.0
Mexico	224,239	+ 167	2.4
Argentina	101,833	+ 77	2.9
Chile	32,208	+ 41	2.2
Colombia	31,183	+ 163	0.8
Uruguay	12,679	– 22	3.9
Venezuela	9,424	+ 31	0.4
Dominican Republic	6,416	+ 31	0.3
Peru	7,805	+ 109	0.3
Costa Rica	3,736	+ 50	1.1
Ecuador	1,764	+ 44	0.2
Guatemala	1,401	+ 34	0.1
Paraguay	1,303	+ 52	0.3
Puerto Rico *	1,169	n.a.	0.3
Nicaragua	1,089	+ 73	0.2
Panama	834	+ 9	0.3
El Salvador	724	+ 19	0.1

* Data for Puerto Rico may not be meaningful because the island's economy is closely tied to the United States and some net activity could be US-based.

The area as a whole is quite dynamic, but – as everywhere else – there are big differences. In Brazil there is increasingly high quality (of technology and content) in addition to quantity. Mexico shows impressive growth; Argentina is doing very well; there is fast improvement in Peru and Colombia (but per-capita rates are still low). Uruguay has the highest density in Latin America but doesn't seem to be growing.

If we consider that in most of these countries many people are poor and illiterate, internet activity in the upper and middle classes is probably as high as in Europe.

Trends are turbulent and confused, as everywhere else; but the presence of Latin America is beginning to be felt in the net. Though unfortunately it's working only for the privileged part of the population.

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After three issues in a short period, mostly about numbers, this newsletter will go back to its usual timing – and discussion of other subjects. But in a while we shall probably take another look at the figures; for an update on the low density countries or an analysis of other areas. Of course we shall continue to follow developments in Europe.