Today's Internetby

David Phillips

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Its Getting Really Pervasive

• Online reach in the UK was 67% - that's 31.7 million people, in 2006

• 74% of users accessed the Internet at least once a week, 52% daily

• 55% of users state that they would be lost without online access

• Among Internet users, 25% of all time spent exposed to media is now spent online

• * 30% of Internet users are online for a minimum of 2 hours, 51 minutes a day

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People like the Internet

• 60% of UK users regard the Internet as their favourite information source for information and entertainment

• The average Internet user in the UK spends 20 hours a week

• 28% say the Internet has caused them to watch less television

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The Trends• Away from traditional web sites to social media.

– Adult websites are down 20% 2005/6– Gambling websites are down 11%– Music websites are down 18%– Net Communities and Chat websites are up 34%– News and Media websites are up 24%– Search Engines are up 22%– Education (driven by Wikipedia) is up 18%– Business and Finance up 12%.

(source Hitwise)

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Where are people going

• More Internet Users• Most have fast Broadband• More time online

– ...and yet its not traditional web sites that are adding new users

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Tesco v HSBC

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Flickr v Digg

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MySpace v YouTube

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What's the buzz

• MySpace (www.myspace.com) attracted 1.5 billion page views in a day.

• August 2006 YouTube had 45 terabytes of videos, views reached 1.73 billion and the total time people spent watching YouTube since from the time it started in 2005 was 9,305 years.

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End of gardening as we know it?

People are not going to traditional sites – they want to go to Social Media Sites.

... and it is not just young people who are affected. Research by AXA, found the over 60's spent more time on line than gardening or DIY and 41% said the Internet is a favourite pastime.

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It's also the economy

• Christmas in 2006 over £7.5 billions was spent on-line in the UK

• More than 10% of all retail sales • Equivalent to £125 for every man, woman

and child in the country.• Over 10% of the UK economy is mediated

by the Internet.(source: Reuters)

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The media

• 43% of people who regularly watch online and mobile video watch less normal TV (Source: Media Corp)

• The Sun newspaper are down 750,000 '95 v '05. November 2006 it had 131 million online page impressions and claimed it 56 million new online readers

• Guardian Unlimited had 106 million page impressions and 11.7 million unique users in December, up 19 per cent year on year.

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Advertising

• Total UK online advertising revenues up eight-fold in real terms between 2001 and 2005 (from £0.17 billion to £1.3 billion per year)

• UK had the highest uptake of Online Advertising in the world by 2006

• June 2007 - Print and broadcast ad revenues declined. Business magazines fell by 3.8% and 6.6% respectively, while total press advertising was down 3.3% .

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The contrasts

• TV ad revenue dropped 0.8% to £962m and radio ad revenue fell 1.8% to £127m in UK Q1.

• Only the outdoor, cinema, and internet sectors saw an increase in spending, with the web ad market growing 42% from the first quarter of 2006.

• (Source e-consultancy.com)

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Advertising is not liked

• According to Insight Express, "consumer trust in advertising has plunged 41% over the past three years" and only "10% of consumers say they "trust" ads today."

• 2. A 2005 study by Yankelovich showed that almost 70% of consumers were actively looking for ways to block, opt-out, or eliminate advertising.

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What's exciting

• The Oxford Internet Survey identified that people like to try out new things online and think it is a good idea. (Source : Dutton et al 2005)

• Age of a web site does not necessarily mean that it is more visible in cyberspace (Source: Adamic and Hubermanx 2005)

• Social media figures highly in online search

• One in four people visited blogs in 2006 (Source: Google).

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The Value of (online) Relationships

In 2005 Rupert Murdock's News International bought MySpace for $580million and in 2006 Google bought YouTube for $1.6billion. By any conventional form of accounting, neither of these two companies had assets of more than a few hundred thousand dollars and yet quickly appeared on the balance sheets of the new owners at multiples that made financier's eyes water.

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Citizen content and relationships

It was in the content and relationships that had been created by people who used these online facilities. Millions of people had created content and shared it among social communities both large and small.

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The Relationship Cloud

One might call such communities a 'Relationship Cloud' and they have value in themselves.

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What is different about Social Media

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The Change

• People are using the internet more• They are deserting newspapers and TV for the

Internet• They don't like advertsising• They like to use social media and experiment• They operate outside organisations• They build relationships• Relationships are built on conversations

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PR has online opportunity

• Based on the DTI/CIPR report, PR is worth 0.008% of the total UK economy.

• Online Public Relation contribution to the economy should be something of the order of £8 billion which means that there is an opportunity to double he size of the PR sector.

• Creative Economy (of which PR is part) is already as valuable to the economy as financial services

(Source The Work Foundation)

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That is amazing

• The Internet is ubiquitous• Communication is ubiquitous• Relationship building online is massive• User Generated Content is huge, valuable and

commonly created by a high proportion of the population

• Effects are seen in the media, online shopping and in the value of social media sites