Google is on course to lose $4.5bn by 2020, according to a report by digital agency Digitally Insured.
The report was published on Monday by Digitaly Insured, a private investment firm that helps clients manage digital risks.
Digital companies are still largely fragmented and are unable to work together to address digital challenges, Digitily Insured’s chief digital strategist, Matthew Dutton, told Digital Trends.
Digital entrepreneurs are still struggling to get their businesses off the ground and that’s the biggest problem, he said.
The sector is also under pressure from governments and regulators that are keen to regulate how companies operate.
“The market is fragmented and we’ve lost our way in that regard.
Digital is still an expensive and hard to access market,” Dutton said.”
When I was in the investment industry I was told by a friend that the market for digital is going to be $40bn by 2030.”
DigitallyInsured said it found the gap between digital and traditional business sectors was widening.
“In the digital world we’ve seen huge growth in the number of new businesses, the value of those businesses and the number and volume of people working in the field,” Denton said.
“We’ve seen the amount of value created through digitisation and how much value we’ve created through the creation of new jobs in the sector.”
Digital trendsThe report predicts digital businesses will continue to be the dominant business sector in 2020, with $6.4bn of that in digital-based companies.
DigitilyInsured also projects that digital businesses account for about $8bn of global growth and $8.5 billion of global economic activity.
The digital economy accounts for $6bn of the $8 billion of GDP.
“While there are plenty of reasons why companies have chosen digital, it is clear that digital is now the dominant way to do business,” Durden said.
“This is a great time to be in the industry.
We’re seeing a lot of growth in terms of the number, types and sizes of companies in digital.”
Digital companies have been growing at a rate of 10 per cent a year for the past three years.
Digitshare analyst Simon Green said the market was “very volatile”.
“The industry needs to recognise that the growth is slowing, that there is a lot more to do and that the challenges will continue,” Green said.