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October 6, 1999

Australian Businesses Big on IT but Cautious of the Net

By CBR Staff Writer

Australian businesses spent A$23.5bn ($15.4bn) on information technology and telecommunications in the 1997-98 financial year, according the Australian Bureau of Statistics (ABS). Leading the way was the finance and insurance sector which accounted for just under 20% of the total.

The ABS figures include internal spending, such as the A$3.94bn paid in wages and salaries to inhouse IT&T employees. Removing these costs reconciles the ABS data with industry research group IDC’s forecast that A$20.7bn will be this year, up from A$18.72bn in 1998. Y2K has resulted in some abnormal increases, but generally speaking IT&T spending continues to grow at three times the rate recorded by the national gross domestic product, said an IDC report.

The ABS report suggests most business use of the internet is confined to email and marketing. At the end of June 1998, 174,870 businesses had access to the

internet, with mining companies recording the highest rate of connection at 46%, compared to the average of 29%. An additional 83,000 businesses expected to be connected by the end of June 1999, the report said.

The ABS report showed that email was used by 92% with an internet connection, while 23% indicated online marketing and promotional capabilities. Only 16% used the

internet to place orders and only 10% to take orders. Just 8% made payments online, 2% received payments online.

At the end of 1998 36,180 businesses, or 6% of the total, had web pages while another 88,000 expected to have web pages by June 1999.

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