‘Internet is Growing’ says UCLA; ‘It’s Not’ Says Nielsen

29 November 2001

As a seventeenth century English proverb has it, ‘two of a trade never agree’. An aphorism that still applies in the twenty-first century, not least to market researchers!

According to a study by the University of California, Los Angeles, US citizens are still flocking to the internet and growth continues unabated.

This contradicts the latest data from Nielsen/NetRatings and Harris Interactive who insist that traffic growth is down. This the duo attribute to the faltering economy and the levelling-off of the internet population.

However, Nielsen/Harris report that online spending, rose in Q3 to $16.3 billion, 60% up year-on-year. But the growth rate – which would be the envy of many other sectors – is down from the 80%-100% experienced during the internet bonanza of the late 90s. Quarter-on-quarter, web spending in Q3 bettered by 7% Q2's $15.2 billion.

Says NetRatings vp of analytical services Sean Kaldor: “That's about the slowest growth we've seen since we started this survey. The economy is bad, which has impacted online spending to the same degree as offline.”

“The days of hyper growth are behind us forever,” opines Kaldor, referring to past years in which internet population growth hit 50% year-on-year. This October, 176.5 million people had access to the web, thirteen percent up on the same month in 2000.

The world of academe at UCLA was more upbeat. Its latest study, Surveying the Digital Future, is the second in an ongoing series, and indicates that over 72% of Americans have internet access, up from 67% per cent last year, while time spent on-line has increased from an average of 9.4 hours weekly to 9.8 hours, mainly to the detriment of TV viewing.

Also, avers UCLA, the average surfer views 4.5 hours less TV weekly than the unwired population, while a quarter of adults say their children also spend less time watching. Almost 90% of the 2,000+ sample approve of the amount of time their kids spend online.

Online shopping remains a key activity despite unrelieved concerns about security, with 49% of the sample claiming they made at least one purchase this year, compared with last year’s 51%. But e-tailing growth looks set to slow with a fall of ten percentage points to 43% year-on-year in the numbers planning to increase online purchasing.

Just 23% regard the web as a good source of bargains, while over 40 per cent say any decision to impose sales taxes on purchases would dim their enthusiasm. Caution is at its greatest among older surfers. Chatrooms and email remain the most popular activities with almost 20% of respondents say they have met an average of six contacts in person after linking up in cyberspace.

The survey was carried out by the Center for Communication Policy at the UCLA Anderson business school.

News sources: AdWeek.com; Financial Times