Consumer confidence and UK e-commerce’s 75% jump

February 25, 2008
by Latitude

One blog post, the three usual suspects, and a shedload of cheering stats. What a way to start the week…

First, IMRG Capgemini have released their figures for online shopping last month, and they show a 75 per cent increase from January 2007.

The IMRG Capgemini research found UK online shopping hit a record high for January as online sales reached £4.5bn, up from £2.6bn for January 2007.

An average of £74 was spent online for every person in the UK.

To what shall we attribute such impressive results? The researchers credited consumer confidence in online shopping, as well as an increase in the total number of Brits shopping online.

So it looks like most people are not as bothered by perceived threats online as some might think. But Google co-founder Sergey Brin thinks they will have good reason to be worried if the Microsoft acquisition of Yahoo goes through:

The Internet has evolved from open standards, having a diversity of companies. And when you start to have companies that control the operating system, control the browsers, they really tie up the top Web sites, and can be used to manipulate stuff in various ways. I think that’s unnerving.

I can’t help but wonder if Brin will remember this when it comes time for Google – which has fast become a company of which many are suspicious – to be subjected to the same kind of scrutiny that Microsoft has been for years.

But Brin is probably smiling right now if he’s really so worried about open standards and market share of browsers. Because as of last month, the Mozilla Corporation‘s free, open source Firefox browser has grown to take 17 per cent of the global market share in internet browsers, behind only Microsoft’s Internet Explorer. Terry Heaton notes:

As of this writing, Firefox had been downloaded 500,309,502 times, a significant milestone by anybody’s measure. If Sergey finds the MicroHoo deal unnerving, Microsoft must surely find this likewise scary.

This is an important point: Firefox, unlike Internet Explorer, does not come bundled with Windows PCs. People have to actively seek it out and download it to their computers. As you might imagine, frustration with IE is one of the biggest boosts to Firefox’s download rate. Heaton continues:

Just two years ago, Firefox had an 11% market share. Today, that’s 17%. This ought to frighten Redmond and warm the heart of Sergey, because loss of browser control has major business ramifications for Microsoft…The postmodern open source movement is the real enemy of modernist technological monopolies, and it’s representative of much of what’s happening in our culture today.

“Customers don’t know or care about open source,” some might say. Even if we accept this, the fact remains that customers do care about whether their browser works or is a pain in the backside. (Full disclosure: I write this as a longtime Firefox user who has recently been seeking comfort in the tabs of other browsers.) As I noted when Microsoft’s bid for Yahoo was first announced, the question of openness is one which “may cause a cultural – and infrastructural – fissure” if Yahoo and Microsoft do merge.

But whether that will happen is still open for speculation. As Microsoft’s share price continues to drop, shareholders continue to file lawsuits against Yahoo for attempting to evade the takeover. Between that and the chunk that Firefox is taking out of Microsoft’s browser market share, Sergey Brin probably didn’t furrow his brow too much this weekend.