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The communication of information, ideas and knowledge is important to many aspects of Australian progress, such as education and economic efficiency. Many aspects of communication - including the freedom and quality of Australia's press, television and radio, and how much we communicate and with whom - are important. This commentary focuses on the Internet, an increasingly important form of communication. Those who have access are able to take advantage of an increasingly diverse range of activities and they communicate with a broad range of people. Many companies, organisations, universities, political parties and individuals have web sites. Online services include education, banking and shopping, while the Internet helps people to work from home or communicate with others, including friends and family.
The number of households connected to the Internet grew rapidly between 1998 and 2002. In 1998, about 1.1 million households (16%) had access to the Internet.1 By 2002 this figure had risen to almost 3.5 million (46% of households). The growth in the number of households connected to the Internet is, as would be expected, reflected in the number of adults accessing the Internet at home. In 2002, adults were more likely to access the Internet at home than anywhere else.1
In 2002, 98% of households connected to the Internet used a computer for access. Between 1998 and 2002, households' access to computers increased, though not as strongly as their access to the Internet. In 1998, just over 3 million households had access to a home computer (44% of households), and 37% of these households were connected to the Internet. By 2002, 4.6 million households (61%) could access a home computer, and three-quarters of them were connected to the Internet. In 2002, the Internet was accessed daily in 37% of households with access to the Internet, with access at least once a week in 91% of such households.
Spending on communication more generally has grown: real household final consumption expenditure on communication more than doubled (in chain volume terms) between 1994-95 and 2002-03 to stand at more than $12 billion (the reference year was 2001-02).2 The price of communications services increased by 1.1% over the period, more slowly than the general rate of inflation (with the price of telecommunication actually falling).3
Computer ownership and Internet access, households
Some differences within Australia
In 2002, access to the Internet at home differed according to household characteristics like income, location and family structure. Households with incomes over $50,000 were more than twice as likely to have access to the Internet at home than those with incomes under $50,000 (66% compared to 29%). Households with children under 15 years old were more likely to have access than others (59% compared to 40%). Metropolitan households were more likely than those outside the cities to have access to the Internet at home (50% compared to 39%).1
Among the states and territories, the Australian Capital Territory had the highest proportion of households connected (60%) in 2002, possibly because of the ACT's relatively high average incomes and younger age profile. Tasmania had the smallest proportion connected, at 35%.1
Businesses use of the Internet is discussed in the Productivity commentary.
Factors influencing change
Many factors affect whether people decide to connect to the Internet at home. Cost and interest in the Internet are two, as is ownership of a computer (most of the people who access the Internet from home use a personal computer).
Although the Internet can be accessed without using a home computer (such as through a mobile phone or a set-top box), 99% of households accessing the Internet used only a computer to access it in November 2000.
In 2002, almost half of the 2.9 million households without a computer reported either that they had no need for a computer or a lack of interest in computers. A little more than one-quarter reported high costs as the main reason for being without a home computer.1
Of the 4.1 million households without access to the Internet in 2002, 41% reported a lack of interest in the Internet or no use for the Internet as the main reasons they didn't have home access. A further 26% reported the costs for home Internet access were too high. But households with high income were more likely to report having access elsewhere, rather than cost, as a reason for not having the Internet at home.1
Although the ABS has little information about the changing cost of Internet access, the price of home computers has fallen steadily in recent times, while the capability of those computers has improved dramatically.8
Interest in the Internet is likely to rise as the breadth of online services increases and people become more accustomed to using them. For example, the proportion of adults using the Internet for to pay bills or transfer funds was only 3% in 1999. This proportion has continually increased and was 23% in 2002. Internet shopping is becoming more common too. In 2002, 26% of Australian Internet users were Internet shoppers compared to only 12% in 1999. Also in 2002, 21% of adult Australians accessed government services via the Internet, with about half of this proportion reporting the main reason was to pay bills. Accessing tax information, submitting tax returns and accessing employment/unemployment information were also popular reasons.1 Some 57% of businesses with Internet access also used 'e-government' in 2001-02, with many seeking information on government services.9
Other factors believed to be a barrier to Internet use include lack of skills and training and concerns over security. The use of the Internet in the workplace is thought to stimulate people to become connected at home, while children who use the Internet at school or a friend's house are likely to provide a push to their own households to become connected.
Links to other dimensions of progress
The Internet can be used for education; it is a powerful research tool and many education institutions are developing distance learning courses over the Internet. But education also plays a part in driving change: people's knowledge of and ability to use the Internet help determine whether they choose to connect at home.
The Internet can be used for cultural or recreational pursuits, and can save time (through activities such as Internet banking) which can be spent on other things. The growth of Internet use might also act as a catalyst for greater social cohesion and improved governance: it can provide better links across a local community while also offering access to national and international resources.
The flow of knowledge and information over the Internet can stimulate innovation. It also allows consumers a way of comparing the prices of, and even purchasing, goods and services from outside their local area, or outside Australia. This might make Australian industry more competitive, both domestically and internationally.
See also the commentaries Productivity; Education and training; Family, community and social cohesion; Democracy, governance and citizenship.