This question came up in class recently, with the students convinced that a billion equals a thousand million, and myself opting for a million million. So, below is the explanation for the confusion, taken verbatim from:
Further online research shows that despite this being common usage (i.e. BBC, newspapers, academia etc) for at least 20-30 years, many British English speakers still find the term confusing… Well, not me any more at least! So thanks to the Bec Higher group for bringing that to my attention, hehe 🙂
One of the students also insisted that the word Milliard, used in German to denote a billion (i.e. 1,000,000,000) is also an English language term, albeit old fashioned. Never having heard of such a thing I looked it up, and lo and behold, right she was, although to all intents and purposes the term is now clearly dead. Best explanation is on Wikipedia at http://en.wikipedia.org/wiki/1000000000_(number) but I did check and they are quite right in this instance.
Oxford Dictionaries entry:
In British English, a billion used to be equivalent to a million million (i.e. 1,000,000,000,000), while in American English it has always equated to a thousand million (i.e. 1,000,000,000). British English has now adopted the American figure, though, so that a billion equals a thousand million in both varieties of English.
In British English, a trillion used to mean a million million million (i.e. 1,000,000,000,000,000,000). Nowadays, it’s generally held to be equivalent to a million million (1,000,000,000,000), as it is in American English.
The same sort of change has taken place with the meaning of trillion.