UK firms moved up in the league of the most advanced users of technology, according to a government study.
The UK came in third -- up four spots from last year -- in the latest International Benchmarking Study, which is designed to measure which technologies are being adopted and how well they are being deployed.
Sweden and Ireland topped the list.
British businesses are particularly keen on broadband, with just over two-thirds of firms using fat pipes. DSL is a popular choice, with connections up 11 percent over last year.
They're also making progress at integrating ICT into business plans and are adopting new technologies such as VoIP and videoconferencing. Just over half now measure the benefits of using technology.
Small businesses are warming to ICT, too. The number of small businesses with websites increased by 16 percent last year while the number buying and selling online grew 9 percent to just over a third of the total.
E-commerce minister Mike O'Brien said in a statement: "The report's clear message is that effective use of ICT can bring real improvements in business performance for all businesses, including the smallest."
The study was produced by consultancy Booz Allen Hamilton for the Department of Trade and Industry. It is based on 8,000 interviews with businesses in G8 countries plus Australia, Ireland, South Korea and Sweden.