Australian shift to the online environment

The Australian Communications and Media Authority (ACMA) released research "Australia in the digital economy: The shift to the online environment" (Communications report 2009–10 series Report 1, 11 November 2011). Unfortunately the report is not formatted for reading on-line. Here is the executive summary reformulated as HTML:

Summary

There is a growing body of evidence showing that more Australians are actively engaging in many aspects of the digital economy, facilitating existing and new forms of social and economic interaction. The following summary of key indictors provides insight into some aspects of the developing digital economy, specifically those which relate to take-up and use of the internet.

Connectivity

Many Australians today have access to the internet at several locations, with most having a broadband internet service in their home. At June 2010, 77 per cent of the population aged 14 years and over had access to the internet at home, 40 per cent at work and 15 per cent at locations other than home or work. Sixty-six per cent of persons 14 years and over had a home broadband service, up from 63 per cent at June 2009.

Of those Australians using the internet, the home and work environment remained the most common sites of internet use with 95 per cent of internet users using the internet at home and 46 per cent at their place of work during June 2010.

The increasing capacity of mobile networks and devices to support triple play services (voice, data and video) is also changing the dynamics of internet use by facilitating increased flexibility in terms of how and where Australians go online while at the same time complementing existing fixed-broadband networks. Thirteen per cent (2.4 million persons) of persons in Australia aged 14 years and over were estimated to have undertaken some form of activity online via their mobile phone during June 2010, compared to nine per cent (1.6 million persons) during June 2009.

Data from the Australian Bureau of Statistics (ABS) also outlines the increasing significance of mobile networks as a complementary service in terms of providing Australians with access to the internet. At June 2010, there were 3.5 million mobile wireless broadband subscribers in Australia accessing the internet via a dongle or datacard connected to a computer, compared to 2.8 million at June 2009. In addition, 30 per cent of mobile phone handsets (6.8 million) were internet-enabled at June 2010. During the same period the number of fixed-broadband subscribers (e.g. DSL) remained fairly steady, further suggesting that mobile wireless broadband is growing in importance as a complementary broadband service.

Small and medium enterprises (SMEs)—businesses employing one to 200 employees—continued to play a significant role in the development of the digital economy through take-up and application of information and communication technologies (ICT) to business processes and service delivery. At June 2010, 94 per cent of SMEs were connected to the internet with 99 per cent of these using a broadband service. Sixty-four per cent of SMEs used internet-enabled 3G mobile phones.

SMEs also used a range of other internet and IP based technologies and applications at June 2010, including web sites (61 per cent), VoIP (26 per cent of SMEs) and mobile email (25 per cent) with take-up of VoIP and mobile email experiencing the highest proportional increase since June 2009; 30 per cent and 47 per cent respectively.

The growth in domain name registrations reflects the increasing use of the internet as a marketing and service delivery channel by individuals and organisations in Australia. At June 2010, there were 1.76 million second-level registered domain names compared with 1.42 million at June 2009, an increase of 24 per cent.¹

Capability

Over the past five years, the frequency of internet use in Australia steadily increased to the point where 28 per cent of the total Australian population aged 14 years and over were estimated to be ‘heavy’ internet users (online more than 15 hours a week) at June 2010. A further 27 per cent were considered to be ‘medium’ internet users (online between 7 and 15 hours a week) and 23 per cent ‘light’ internet users (online up to 7 hours a week).² The proportion of the population not using the internet on a weekly basis declined to 22 per cent at June 2010 from 33 per cent at June 2005.

While all age groups recorded significant increases in weekly internet users, persons aged 55–65 years and 65 years and over were still less likely to use the internet than other age groups. At June 2010, 55 per cent of persons aged 65 years or older and 27 per cent of persons aged 55–64 years did not use the internet on a weekly basis, compared to an average of 22 per cent for the total population aged 14 years or over.

Australians engaged in the digital economy through a range of online activities however communications, research, information, banking and finance and general browsing activities tended to dominate. During the month of June 2010, 79 per cent of persons using the internet via a computer went online for communication purposes (email, instant messaging or VoIP), 75 per cent for research and information purposes, 64 per cent for banking and finance related activities and 61 per cent general browsing.

While increasing numbers of Australians are using the internet via their mobile phone, the level and scope of online activities performed via mobiles was significantly lower in comparison to activities performed online by a computer. This was particularly the case in relation to e-commerce activities were only seven per cent and 19 per cent of mobile phone internet users went online via their mobile for shopping or banking purposes respectively during June 2010, compared to 28 per cent and 64 per cent for persons using the internet via computer.

Similarly, activities relating to communications, research/information and transactions featured prominently in the activities undertaken by Australian SMEs online. At June 2010, 98 per cent of online SMEs used the internet to communicate with customers and suppliers via email, 91 per cent looked for information about products and services, 88 per cent went online for banking purposes and 88 to look for suppliers, while 74 per cent received payments for goods and services online and 81 per cent made payments online.

Confidence

The internet is making access to information more convenient and efficient. As a result, the volume of information and content accessed by Australians via the internet has steadily increased over 2009–10. For example, during the June quarter of 2010, 155,503 terabytes of data were downloaded in Australia compared to 99,249 terabytes during the June quarter of 2009. Fixed-line networks accounted for 91 per cent of data downloaded during the June quarter of 2010.³

The participative web, encompassing social networking and user generated content (UGC), continues to be a major driving force in the increasing intensity of online participation. During June 2010, 8.7 million Australians accessed main stream social networking/UGC sites such as Facebook and YouTube from home, spending in total more than 41.5 million hours on these sites. Facebook continued to maintain its dominance of the social networking/UGC market in Australia, accounting for 81 per cent of time spent on social networking/UGC sites and 82 per cent of web pages viewed during June 2010. The business sector in Australia is slowly recognising the potential of social networking for marketing and business networking purposes. At June 2010, approximately 10 per cent of SMEs connected to the internet used online social network channels for business purposes such as advertising and awareness raising.

The internet has empowered many consumers economically by making it easier to locate goods and services and compare costs. The internet has also empowered businesses by enabling the development of new online markets, often with price differentiation between offline and online purchasing channels, which has in turn encouraged the continued growth of internet commerce in Australia. According to the ABS, income from the sale of goods and services online reached $123 billion in June 2009 compared with $81 billion in June 2008. (ABS data relating to June 2010 is not available as yet). Table 1 presents a summary of digital economy data in this report.

Table 1 Australia in the digital economy: summary metrics

Indicator	June 2009	June 2010
Connectivity
Proportion of population having ever used the internet at June*	88%	89%
Proportion of population with a broadband connection at home at June*	63%	66%
Proportion of population having used the internet via their mobile phone during June*	9%	13%
Proportion of online SMEs with broadband at June	96%	99%
Proportion of SMEs using internet-enabled 3G mobiles at June	62%	64%
Number of ‘.au’ domain name registrations at June†	1.42 million	1.76 million
Capability
‘Heavy’ internet users in the population* (>15 hours online a week) at June	26%	28%
Proportion of internet users undertaking communications activities online during June*	n/a	79%
Proportion of internet users undertaking research and information searches online during June*	76%	75%
Proportion of internet users undertaking banking or financial activities online during June*	n/a	64%

Confidence
Value of internet commerce at June‡	$123 billion	n/a
Number of web pages viewed from home during June	16.8 billion	17.2 billion
Number of persons accessing social networking/UGC sites from home during June	8.3 million	8.7 million
Number of hours spent on social networking/UGC sites at home during June	32.1 million	41.5 million
Number of Australians accessing main online news sites from home during June	5.9 million	6.1 million
Volume of data downloaded via the internet (terabytes) during June quarter	99,249	155,503
Proportion of internet users buying or selling online during June*	28%

*Persons 14 years and over. †Excludes domain names registered under ‘.gov.au’.

‡Defined as the value of goods/services purchased or ordered online regardless of whether paid for online. n/a = Not available.

Note: Web metric data relates to persons two years and over using a broadband service from home.

1 Excludes ‘.gov.au’. Within the .au domain, there are several second level domains (2LDs). Each serves a specific type of enterprise. For example, ‘.com.au’ serves commercial organisations and ‘.edu.au’ services educational institutions. For a full list of second level domains, see www.auda.org.au/domains/au-domains/.

2 Terms relating to ‘heavy,’ ‘medium’ and ‘light’ defined by Roy Morgan Single Source, June 2010.

3 Comparative data is not available for June 2009 as ABS did not collect volume of data downloaded by access technology prior to the December quarter of 2009.