The Saudi Internet economy is forecast to rise to SR107 billion by 2016, representing 3.8 percent of GDP, from SR37 billion recorded in 2010, representing 2.2 percent of GDP, which put Saudi Arabia at 13th place among the G-20 countries, The Boston Consulting Group said in its Connected World series. It found that by 2016 the total size of the G-20 Internet economy will be $4.2 trillion, equivalent to 5.3 percent of GDP, up from $2.3 trillion or 4.1 percent in 2010. “The $4.2 trillion Opportunity: The Internet Economy in the G-20” report finds that if the Internet were a sector in Saudi Arabia, it would be more than twice as large as the utilities sector. Saudi Arabia's Internet economy growth rate of 19.5 percent compares favorably to other developing nations in the G-20, which are growing at an average of 17.8 percent. Projected growth rates elsewhere are: 24.3 percent in Argentina, 18.3 percent in Russia and 15.6 percent in Mexico. In 2016, Saudi Arabia will rank number 10 in the G-20, with its contribution to GDP increasing to 3.8 percent. These growth rates are impressive compared to the Internet economies of developed G-20 markets, which are expected to grow at an average of 8.1 percent through 2016 - for example, 10.9 percent for the UK and 7.8 percent for Germany. In 2010 developed markets contributed 76 percent of the G-20's Internet economy; by 2016 that will fall to 66 percent. “The Internet offers one of the world's unfettered growth stories,” said Joerg Hildebrandt, Partner and Managing Director at BCG Middle East. “A robust Internet economy is an essential underpinning for Saudi Arabia's future, providing both economic and social benefits.” In 2010, the share of total retail carried out online in Saudi Arabia was 2.9 percent or $3 billion and is projected to reach 8.0 percent or $15bn by 2016. Hildebrandt said: “This represents a dramatic increase and to put it into perspective, it would place Saudi Arabia at 5th position amongst the G-20 countries, following only UK, Germany, Australia and South Korea.” In 2010, the Internet influenced an additional 4.7 percent of total retail from connected consumers researching online and purchasing offline (ROPO) in Saudi Arabia. These numbers compare to 4.0 percent for Brazil, 4.8 percent for Russia, and 9.6 percent for the US. Consumers are the big winners of the Internet economy and BCG's study highlights just how essential it has become to everyday life and the value which consumers attach to it. Asked how much they would have to be paid to live without Internet access, respondents across the G-20 said an average of $1,430 per year, or 4.6 times what they pay for access and services.
