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Dot-coms back in business as Euro Internet usage surges

Eugene Lacey GameSpot Europe

Published: 14 Aug 2002 12:05 BST

Only the brave or stupid would hail the bottom of a downturn when a 'double dip' recession remains a strong possibility. But whatever happens in the wider tech economy -- there is one clear bright spot: European Internet usage is surging. This growth leaves the continent's strongest Internet firms set fair for solid growth now that the shakeout has left some clear leaders in key markets.

It wasn't supposed to happen like this. The conventional wisdom was that business to consumer sites were the archetypal 'bubble' stocks. Nobody expected to see a recovery here -- the green shoots were supposed to break the soil in enterprise software first, not 'B2C' e-commerce sites.

The active Internet population in Europe is up 14 percent in six months, according to figures from Nielsen/Net Ratings -- with nearly 13 million new users coming online in the five largest countries this year so far. France and Spain are the hot spots -- with user bases growing 25 percent and 54 percent respectively since January.

The surge is enabling Europe to start closing the gap with the US in terms of online users as a percentage of its population -- a fact that has not escaped the attention of American Internet giants MSN, eBay, and Amazon -- all of whom who are growing revenues fast in Europe.

The US giants look like being the main beneficiaries of a growing Internet population -- with the shake out having knocked out more local dot-coms than US Web goliaths. But while Expedia, Amazon and eBay look strong Europe is not 'sewn up' -- far from it.

Lastminute.com is a good example of a European survivor now viewing the new Euro landscape more positively. With subscribers to the travel bargain site growing strongly -- it was able to report second-quarter revenues up 90 percent -- putting its glamorous chief executive, Martha Lane Fox, back in the headlines. Local banks are standing up well against US competition -- as are gambling sites, Kelkoo's price comparison service, and the incredibly innovative travel planning site ViaMichelin.