The 2010 annual survey into e-commerce and ICT activity measures the use of information and communication technologies (ICTs) by non-financial businesses with 10 or more employment.
The largest businesses continued to lead the way in the adoption of new technology. However, smaller businesses were closing the gap with increasing numbers using broadband and mobile 3G Internet, developing websites and using the Internet to interact with public authorities.
In 2010, 95.1 per cent of businesses had Internet access, with 92.3 per cent connecting via broadband. While this shows near saturation with regard to broadband Internet connections, significant growth was seen in the adoption of mobile technology. Over half of businesses (at 51.9 per cent) used mobile broadband using 3G, compared with 36.0 per cent in 2009.
The largest growth was seen in the smallest businesses, those with 10 to 49 employment, where the proportion using 3G mobile broadband increased from 30.8 per cent in 2009 to 46.6 per cent in 2010. The growth in the largest businesses, those with 1,000 or more employment, was much smaller, increasing from 89.1 per cent in 2009 to 94.7 per cent in 2010. The growth in the use of 3G mobile broadband is consistent with similar growth reported in the Internet access: Households and Individuals survey.
In 2010, e-commerce sales as a proportion of total sales increased to 16.9 per cent from the 2009 estimate of 16.1 per cent. The estimated value of these sales was £385.4bn.
Over three quarters of businesses had a website in 2010 (78.7 per cent). While the majority of businesses had a website, a relatively small proportion of businesses used the website for selling (15.3 per cent). This was an increase from the 2009 estimate of 14.0 per cent.
While virtually all businesses who reported website sales had customers in the UK (15.3 per cent of businesses), 6.4 per cent also reported selling to customers in other EU countries and 5.0 per cent to customers in the rest of the world.
The value of website sales as a proportion of total sales stayed constant at 4.2 per cent in 2009 and 2010. This represented a value of £95.9bn in 2010.
The Wholesale sector had the strongest website sales with sales valued at £37.5bn. The Retail sector showed the second highest website sales of £12.8bn in 2010, up from £11.6bn in 2009.
In 2010, 7.0 per cent of businesses sold over ICTs other than a website (for example non-web EDI), representing 12.7 per cent of the value of all sales. While fewer than half the number of businesses used non-web ICTs for sales compared with websites, the value of non-web ICT sales was, proportionately, three times higher than website sales. The total value of sales over ICTs other than a website was £289.5bn.
The Wholesale sector reported the largest sales over ICTs other than a website at £118.3bn, followed closely by the Manufacturing sector at £110.3bn.
In 2010, 50.1 per cent of businesses placed orders with suppliers over computer networks.
The majority of businesses who made ICT purchases bought from suppliers in the UK (49.7 per cent). This compares with 10.1 per cent who bought from suppliers in other EU countries and 7.3 per cent who purchased from suppliers in the rest of the world.
The proportion of employees who had Internet access at work increased slightly from 47.6 per cent in 2009 to 48.2 per cent in 2010.
In 2010, 95.1 per cent of businesses had Internet access. DSL broadband was the most common type of connection, with 86.5 per cent of businesses connecting this way. A total of 92.3 per cent used some form of broadband connection. Dial-up or ISDN connections continued to fall with just 17.6 per cent of businesses capable of connecting this way compared with 22.2 per cent in 2009.
While almost a quarter (24.0 per cent) of the largest businesses had an Internet connection with a maximum contracted speed of 100Mbps or more, the most common connection across all businesses was between 2Mbps and 10Mbps, at 44.6 per cent.
There was a significant increase in the use of mobile broadband in 2010, with 51.9 per cent of businesses using a 3G connection, compared with 36.0 per cent in 2009. The proportion of businesses who used a mobile Internet connection other than 3G in 2010 was 13.8 per cent.
Using the Internet to interact with public authorities saw large growth in 2010 with 86.5 per cent of businesses using this Internet facility compared with 66.4 per cent in 2009. The most popular reason for interacting with public authorities online was submission of VAT returns (84.1 per cent). Over half of businesses (55.3 per cent) also used the Internet to return details of National Insurance contributions.
Business use of RFID technology has seen a small decrease since the question was last asked in 2008, with 1.4 per cent of businesses using this technology in 2010 compared with 1.7 per cent in 2008. However, this is a facility that was utilised to a greater extent by the larger businesses with almost a fifth (18.6 per cent) of the largest businesses using RFID compared with 0.9 per cent of the smallest businesses.
Key issues specific to this release
The 2010 annual e-commerce survey provides information on UK businesses’ use of information and communication technologies (ICTs). The survey was sent to approximately 7,700 UK businesses with employment of 10 or more. Most sectors of the economy were covered (see background note 6).
Until the 2009 survey, financial sector businesses were included in the survey results relating to ICT adoption and usage. The financial sector was not included in results relating to e-commerce activity. Coverage of the financial sector businesses has been discontinued in the 2010 survey. This means that results published in this bulletin relating to tables 1, 2, 12, 14 and 15 are not comparable with previously published estimates.
The estimates published for 2009 were the first to be published under the new Standard Industrial Classification (SIC) 2007 basis. This replaced the SIC 2003 classification system. The estimates in this release that relate to the 2006 and 2007 survey years are on a SIC 2003 basis. Results for the 2008 survey were originally compiled and published under SIC 2003, and have been re-estimated on the new SIC 2007 basis to enable comparisons to be made with 2009 and 2010.
There were changes to the e-commerce questions asked in the 2008 survey, which impacted on the published results. The Internet/non-Internet split of e-commerce transactions, that had been included since the survey began, was discontinued after the 2008 survey. This was replaced with a breakdown of website and non-website transactions. The historical e-commerce estimates, broken down by Internet and non-Internet sales, have been discontinued from this release, but are still available on the ONS website in the 2008 e-commerce and ICT Statistical Bulletin. As a result of the changes to the measurement of e-commerce, this release provides e-commerce estimates from 2008 onwards.
Until the 2007 survey, the definition of e-commerce sales and purchases included transactions over manually typed email. From the 2008 survey onwards, this changed and email transactions were excluded. This means that e-commerce sales published in this release are not directly comparable with estimates previously published for 2007 and previous years.
The estimates of the 2010 ICT sales as a proportion of total sales were calculated using estimates from the 2009 Annual Business Survey.
Uses of the data
This bulletin provides information on two areas of business activity, namely the values of e-commerce sales, and the levels of use by businesses of various ICTs. In some cases, growth over time can be seen where ICT use has been measured on a comparable basis in previous years. Examples of this include the measurement of ICT activities such as Internet access, broadband and websites.
Results are presented by business employment sizeband. This allows comparisons of the levels of e-commerce trading and ICT activity to be made between different sized businesses.
The survey results enable productivity impact analysis to be performed and help provide a better understanding of the contribution of new ICTs to productivity.
The survey is conducted across all EU member states. This allows comparisons to be made with other EU countries. See note 7 for more details.
Summary quality report
A Summary Quality Report for this publication describes, in detail, the intended uses of the statistics presented in this publication, their general quality and the methods used to produce them.
Common pitfalls in interpreting the series
This report should not be confused with the Internet Access statistical bulletin. The latter is a separate release that contains estimates on Internet access and use of the Internet, by households and individuals.
The estimates of the percentages of businesses are weighted to be consistent with the number and profile of businesses in the UK economy. Results weighted by number of businesses give an equal weight to every business irrespective of size. This method of calculation reflects the contribution made by the large number of small businesses and is appropriate when assessing, for example, ICT penetration.
The provision of the results to Eurostat (the EU's statistical office) is a requirement set out in the ICT Regulation of the European Parliament and Council 808/2004 and the survey collects the data necessary to meet this requirement. The estimates in this release relate to those sectors of the economy where coverage is required by Eurostat, under the terms of the ICT regulation and it should therefore be noted that the survey is not intended to provide full coverage of all UK ICT and e-commerce business activity.
The survey covers businesses within the following economic sectors, according to the Standard Industrial Classification (SIC) 2007.
Manufacturing: Div 10-33
Utilities: Div 35-39
Construction: Div 41-43
Wholesale: Div 45-46
Retail: Div 47
Transport and Storage: Div 49-53
Accommodation and Food Services: Div 55-56
Information and Communication: Div 58-63
Other Services: Div 68-74, 77-82, 95.1
The sectors of the SIC 2007 not covered by the survey are as follows:
Section A Agriculture, Forestry and Fishing
Section B Mining and Quarrying
Div 75 Veterinary Activities
Section O Public Administration and Defence, Social Security
Section P Education
Section Q Health and Social Work
Section R Arts, Entertainment and Recreation
Section S Other Service Activities except SIC 95.1, Repair of computers
Estimates in this release relate to businesses with 10 or more employment. No information is collected relating to businesses with less than 10 employment as these are not within the coverage requirements defined by Eurostat. Until the 2004 survey, businesses with less than 10 employment were included in the survey, due to a specific user interest from the then Department of Trade and Industry (DTI). When this user interest ended the coverage of these businesses was discontinued, leaving the coverage from 2005 onwards as being just what was required by Eurostat under the ICT regulation. The decision to cease collection of information from these businesses was made on the grounds of resources available to run the survey and the burden placed on them in requiring them to take part in the survey.
Since the DTI interest in monitoring businesses with less than 10 employment ended, no other specific user interest in their activity has been identified. A user survey conducted in April 2011 did not receive any feedback requesting the resumption of coverage of this group of businesses. Further user surveys will continue to monitor whether any new interest emerges in future.
It is not possible to estimate what the current survey results would be if the businesses with less than 10 employment were still covered by the survey. However, in 2004, the last year that these businesses were included, ONS estimated that they represented 6.6 per cent of total sales over the Internet. Until the 2004 survey, these businesses also had lower proportions of ICT adoption and usage than the larger businesses. This meant that estimates of the proportions of "all businesses" carrying out an ICT activity were lower in the 2004 results than in the 2005 results and onwards, when "all businesses" were defined as businesses with 10 or more employment.
Estimates in this release relating to 2006 and 2007 relate to the previously used SIC 2003 classification.
The survey is run in all countries of the European Union (EU) and also in some non-EU countries. The measurement of e-commerce and ICT usage is under continuing review and development, both within the EU and worldwide, in the context of the Statistical Office of the European Commission (Eurostat) and Organisation for Economic Cooperation and Development (OECD) discussions. Due to the nature of ICTs, the collection and outputs of the e-commerce survey are therefore, likely to remain under continuous review and subject to change. Comparative data for EU countries can be found on the Eurosts website.
Results published by Eurostat in relation to the 2009 survey showed the UK to be near the top of the EU table for making purchases and receiving orders online. This is also true for the percentage of GDP made up by technology expenditure. ONS published a summary of how the UK results compared with the rest of the EU.
Revisions to earlier years
As in previous years, estimates are subject to revision and 2008 and 2009 estimates have been revised by businesses contacted in the process of validating the 2010 data. This process revealed cases of contributors who had misreported data. The 2008 and 2009 values of e-commerce sales have been revised down as a result of the correction of the misreported data.
Sampling variability and confidence intervals
The Inter-Departmental Business Register (IDBR) was used as the sampling frame, and approximately 7,700 UK businesses were sampled. The estimates are subject to sampling variability, as are those from all sample surveys.
The e-commerce sales confidence intervals show sampling variability for estimates relating to e-commerce sales in 2010. These contain the ‘95 per cent confidence intervals’, which means that it is expected that in 95 per cent of samples the range would contain the true value.
74.9 per cent of the 2010 survey questionnaires were returned and validated for inclusion in the results.
No imputations were made for contributor or item non-response as all data items on the questionnaire had to be validated prior to feeding into results. The only exceptions to this were where, under certain conditions, a missing value data item was estimated based on other contributors in the same employment sizeband and SIC. For this to take place, the business had to have returned all non-value data items and all these items had to have passed validation.
Details of the policy governing the release of new estimates are available from the ONS Media Relations Office.
National Statistics are produced to high professional standards set out in the Code of Practice for Official Statistics. They undergo regular quality assurance reviews to ensure that they meet customer needs. They are produced free from any political interference. © Crown copyright 2011.
Next publication: November 2012
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