A report commissioned by the European Commission found out that although four out of five Europeans have broadband connections, a substantial portion do not use the internet.
Nearly 80 percent of European businesses are now broadband connected - although the quality and speed varies markedly - which is a 15 percent increase in 2005.
However, the study also found out that forty per cent of Europeans do not use the internet at all.
The report is part of the European Commission's i2010 initiative which aims to improve growth and provide jobs using information technology and high speed internet access.
60 percent of public services are now available online with nearly 70 percent of schools are broadband equipped.
Viviane Reding, EU Commissioner for Information Society and Media, commented "Some parts of the EU are still lagging behind and are not fully connected. All EU countries must therefore work harder to close the gaps, to enhance cross-border communication services as well as services that also reach rural and remote regions".
The EC reckons that there are now 100 million broadband connections Across the EU with new subscribers in 2007 making up two fifth of them.