E-commerce activity shatters predictions

E-commerce activity shatters predictions

The strong rate of Internet uptake amongst Australian homes and businesses is shattering analyst predictions, according to IDC. The result is a sharp surge in online purchasing and e-commerce transactions.

Total Internet users in Australia are forecast to increase from 5.52 million in 1999 to 11.75 million in 2004, a key contributor being affordable Internet access and the introduction of less expensive Internet access devices, such as the new Sony Playstation 2.

IDC says two key factors have lowered the cost of getting connected in Australia: PCs have become more affordable through competitive financing packages, and the GST has knocked down hardware prices by as much as 10 per cent.

It also predicts that the number of Internet users making the transition to "buyer" will increase rapidly as the level of local content increases. Emerging local e-commerce vendors such as nineMSN, dStore, Shopfast and wishlist will drive these increases.

In 1999, the figures show less than 25 per cent of Internet users making purchases online spent an average of $US573. By 2004, IDC predicts this figure will jump to 50 per cent with the user spending an average $US3,651.

This is an increase in the total e-commerce spend in Australia of $US1.2 billion in 1999 to $US37.3 billion in 2004 and represents a compound annual growth rate of 130 per cent during the five-year period.

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