The internet is far bigger than earlier estimates suggested, according to a new study undertaken by the University of Texas Center for Research in Electronic Commerce. Cisco Systems Inc funded the research. UT found that the internet economy generates around $300bn a year in the United States alone, and that it employs 1.2 million people in infrastructure, application, intermediary and commerce roles. Infrastructure alone accounts for 40% of the internet economy – $115bn in revenue. UT expects this trend to continue and hazards that server hardware companies, including IBM Corp, Sun Microsystems Inc and Hewlett Packard Co, will be the chief beneficiaries.
Intermediaries like Yahoo, Excite, DoubleClick, CNet and ZDNet accounted for $58bn in revenue in 1998. Meanwhile, UT claims internet commerce is already worth $102bn, a higher figure than other studies, which UT says counted only the top players. Eventually, the researchers said, internet intermediaries and commerce will overtake the infrastructure sector in value. But they noted that the internet economy already rivals century-old industries like energy, automobiles and telecoms. Revenue per internet economy employee is about $250,000, or 65% more than industrial workers. (So why haven’t the big dot com stocks turned a profit yet?)
