Broadband take-up to influence e-commerce

Broadband coverage will determine how fast e-commerce take up rates will be in the Gulf.

"Internet access and usage – especially broadband – influences consumer choice and behaviour and is increasing the importance of online retailing," according to Euromonitor International, the research firm.

Within the Gulf, the UAE will breach the 90 per cent mark in terms of the population using the Internet by 2015 and reach 93.8 per cent in 2017, according to Euromonitor.

But Saudi Arabia will have some catching up to do, even providing for the fact that its population base is much wider. By 2015, only 63.5 per cent of its population will be using the Internet and rising to 69.2 per cent by 2017.

The e-commerce story in the Gulf is principally scripted by what happens in the UAE and Saudi Arabia.

According to Euromonitor, on average 30.6 per cent of households possessed a broadband Internet-enabled computer in 25 key emerging market economies — including the UAE — in 2012 against 73.5 per cent in advanced economies as of last year.

"A digital divide also persists within emerging market economies... for example, Hungary, Poland, the UAE and Malaysia were the only EMEs in 2012 to have a broadband penetration rate of over 60 per cent of households, while less than 10.0 per cent of households in India, Indonesia and South Africa had a broadband enabled computer," the firm notes.

Also, between 2007 and 2012, web retailing in emerging market economies was up 438 per cent (in fixed dollar terms) to be $106 billion by the end of the period.

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