Europe’s Well-Connected Consumers

man on cobblestone street examines mobile phone

Home to approximately 740 million people, many of them affluent, Europe spends a lot of money on information and communications technology (ICT). The European ICT market was worth $769 billion in 2017 (up 1.8% from 2016).^a

Yet, despite the best efforts of the European Union (EU), Europe is not one market. There are major cultural differences and economic disparities between northwest Europe and southeast Europe. Whereas Germany, the U.K., the Nordics, and the Netherlands tend to attract migrants from all over the world, many countries on the eastern and southern rims of Europe are seeing an exodus of young people and low birth rates. Indeed, the continent as a whole is aging: One fifth of the people in the 28 members of the EU (the EU28) are now 65 or over, compared with 17% in 2007.^b In the U.S., the equivalent figure is 15% and in China 11%.^c

The vast majority of Europeans are online. It is relatively cost-effective for the region’s telecoms companies to provide connectivity: Europe is densely populated and heavily urbanized—three quarters of the EU population lives in cities, towns, or suburbs. Across the EU28, more than 87% of households had Internet access and 85% broadband Internet access at the end of 2017.^d Moreover, the broadband is relatively quick: Of the top 50 countries ranked by broadband speeds worldwide, 36 of them are in Europe.^e Sweden has the fastest broadband in Europe, offering an average speed of 46Mbps. However, interference between Wi-Fi networks is common in the many districts where people live in apartment buildings, while cellular networks can also be heavily congested in city centers.

Most Europeans now have smartphones. Approximately two-thirds of people in the EU28 between ages 16 and 74 had mobile Internet access at the end of 2017, up from 36% in 2012. But there are wide regional variations, with that figure reaching 87% in the Netherlands and Sweden, compared with just 32% in Italy and 40% in Poland. In 2017, close to three quarters (72%) of individuals in the EU28 accessed the Internet on a daily basis, with a further 8% using it at least once a week.

A Battleground for North American and East Asian Technologies

Lacking a major computing industry of its own, Europe is a relatively neutral market for hardware and software made in both North U.S. and East Asia. Major American and Asian brands go head-to-head in the smartphone, tablet, and computing markets, but their operating systems all hail from the U.S. Android dominates the European smartphone market. Some 70% of smartphones in use in Europe run Android, while 28% run Apple’s iOS, while less than 1% run Windows.^f However, in the tablet market, iOS has a market share of 66%, while Android has 34%. But there is one key smartphone component that hails from Europe—U.K.-based ARM Holdings’ microprocessor architecture is used in more than 90% of the world’s handsets. This low-power architecture has proven pivotal in the development of advanced handsets with long battery lives.

Europeans tend to be greener than North Americans. More than nine in 10 respondents (94%) say that protecting the environment is important to them personally.

Social networking in many European countries is not as prevalent or as popular as in North America, the birthplace of Facebook and other leading social networks. Just over half (54%) of Europeans age 16 to 74 use the Internet for social networking, while in France and Italy that proportion is as low as 43%,^g potentially reflecting a preference for face-to-face interactions. In the same demographic, 57% of Europeans shop online, while 18% are using accommodation-sharing services, such as Airbnb, and 8% use ride-sharing services, such as Uber.

In Europe’s three largest economies (France, Germany, and the U.K) YouTube and Netflix are the top video streaming apps, ahead of local media players, while WhatsApp Messenger, Facebook, and Facebook Messenger are the top three social apps in these markets.^h Although major U.S. Internet services are widely used across Europe, some smaller players also have significant traction. For example, London-based music recognition service Shazam, which was recently acquired by Apple, is ranked sixth in Italy in terms of monthly active users, and seventh in France, and ninth in Spain. In Russia, a market apart, cultural and regulatory factors have helped several local players, including Yandex, Mail.Ru, and Sberbank, compete very effectively with the global players. All of these have apps in Russia’s top 10, as ranked by monthly active users.

Europeans Care about Privacy and the Environment

Privacy is a big deal for Europeans, particularly in Germany, which is very wary of state surveillance after the country’s experience of authoritarianism in the first half of the 20th century: Some 45% of Europeans who use the Internet have installed or changed their antivirus software in the past three years due to privacy and security issues, while 39% say they are now less likely to share personal information on websites.ⁱ More than six in 10 respondents (61%) say the security and privacy features of an IT product play some role in their choice, while 27% are ready to pay more for better security and privacy features.

Europeans also tend to be greener than North Americans. More than nine in 10 respondents (94%) say that protecting the environment is important to them personally, and among these more than half (56%) say it is very important^j. These findings have remained broadly consistent over the past decade.

Europeans have mixed feelings about the direction in which ICT is headed. Although more than six in 10 respondents have a positive view of robots and artificial intelligence, an even higher proportion (72%) agree robots and AI steal jobs.