Measuring the economic impact of the internet is tricky business. There’s a lot of debate, for instance, about the internet’s impact on productivity. The productivity statistics don’t reflect much of a boost, so the question is whether that means the internet hasn’t been the boon we think it has, or whether the statistics aren’t capturing something.
Felix Salmon has a good piece at Wired on a somewhat different problem: One researcher’s attempt to calculate the GDP of the internet. But, as Salmon explains, that’s impossible and also pretty pointless:
Remember the dot-com boom of the 1990s, when everybody got excited about the internet because it was a new way to buy stuff? That’s basically what BCG is measuring here. They’re taking total consumer expenditure in each country, and working out how much of that expenditure is online. As in, buying a hardback from Amazon, or a Beanie Baby from eBay. Then they add in the amount you pay your ISP to get online each month. And then they add a certain amount for investment by private enterprise in internet infrastructure, and a bit more for what they call “net exports” — the Czech Republic, for instance, apparently has a big internet security software sector.
But that’s a tiny fraction of how the internet has affected daily life:
it seems to me that BCG’s not really measuring the internet here — it’s not measuring the hours spent watching YouTube, or interacting with friends on Facebook and Tumblr, or spreading news on Twitter, or even checking your stock portfolio or updating your billing information somewhere.
The researcher, Paul Zillenberg, admits that the exercise gets increasingly futile as the internet permeates every aspect of our lives, comparing it to trying to measure the GDP of electricity. That’s pointless. Electricity undergirds nearly all economic activity.
The productivity debate, on the other hand – well that’s an interesting one I can’t wait to see resolved.