BUSINESS USE OF INFORMATION TECHNOLOGY


BUSINESS USE OF INFORMATION TECHNOLOGY

As indicated in the Explanatory Notes, the Business Characteristics Survey (BCS) collects key indicators of IT use and innovation in Australian business annually and more detailed information for each of these topics is collected every second year (i.e. in alternating years). The 2006-07 BCS had a focus on innovation, therefore only a selected number of IT use indicators are available.

Summary IT use indicators for 2006-07 were first released in Summary of IT Use and Innovation in Australian Business, 2006-07 (cat. no. 8166.0) in June 2008. These indicators include Internet access; web presence; and placing and receiving orders via the Internet or web. This section includes the relevant IT Use indicators as well as some more detailed information about broadband usage, including type of broadband connection and Internet income. Explanatory Notes 22 and 23 provide more detail about definitions of Internet commerce and quality of associated financial data.

The 2007-08 BCS will collect more detailed information for IT use in Australian Business and these detailed results are due for release in August 2009 in Business Use of Information Technology, 2007-08 (cat. no. 8129.0).

Business use of information technology(a), by employment size, by selected indicators - 2006-07
		Employment size
		0-4 persons	5-19 persons	20-199 persons	200 or more persons	Total
		%	%	%	%	%
Proportion of all businesses with:
	Internet access	r83.4	r89.6	98.4	99.9	86.5
	web presence	24.5	r44.4	r67.6	95.0	r33.9
Proportion of businesses with Internet access and:
	broadband as main type of Internet connection	89.0	r92.7	r93.3	98.6	90.5
r revised
(a) Data in this table were originally published in June 2008 in the release Summary of IT Use and Innovation in Australian Business (cat. no. 8166.0). Minor revisions have occurred and in all but one instance these were 0.2 percentage points or less. For further information refer to Introductory Notes.

Internet access

Internet access during the year ended 30 June 2007 was reported by 86% of all businesses. An association exists between the employment size of a business and the likelihood that the business is using IT. The proportion of Australian businesses using IT is greater for each successive employment size range. For example, almost all businesses with 200 or more persons employed accessed the Internet, while only 83% of businesses with 0-4 persons employed accessed the Internet.

At the industry level, Professional, Scientific and Technical Services; and Information Media and Telecommunications (both 98%) recorded the largest proportions of businesses which accessed the Internet, whereas the lowest rate was in Accommodation and Food Services (68%).

Innovation-active businesses, at 95%, were more likely to report Internet access during 2006-07 than non innovation-active businesses (82%).


Web presence

Over a third of all businesses reported having a web presence, either on their own dedicated website or as a presence on another entity's website. The proportion of businesses with a web presence increased with each successive employment size range, from 24% of businesses with 0-4 persons employed to 95% of businesses with 200 or more persons employed.

Businesses in the Information Media and Telecommunications industry had the highest proportion of businesses with a web presence (65%). The lowest proportion was in the Transport, Postal and Warehousing industry (14%).

More than half (51%) of innovation-active businesses reported having a web presence, compared to 24% of non innovation-active businesses.


Broadband connection

Businesses with Internet access were asked to identify the main type of Internet connection used as at the end of June 2007.

Broadband, which is defined by the ABS as an 'always on' Internet connection with an access speed equal to or greater than 256kbps, was identified as the main Internet connection type by 90% of businesses with Internet access as at the end of June 2007.

By industry, Broadband as the main connection type was most prevalent in Financial and Insurance Services (97%).

Main type of broadband connection(a)(b), by employment size - 2006-07
	Employment size
	0-4 persons	5-19 persons	20-199 persons	200 or more persons	Total
	%	%	%	%	%
DSL	75.2	83.8	81.8	61.2	78.4
Cable	16.6	10.0	13.1	33.6	14.3
Fixed wireless	3.1	3.3	2.9	1.6	3.1
Mobile wireless	4.1	2.1	1.1	0.4	3.2
Satellite	1.0	1.0	1.0	0.4	1.0
(a) Proportion of businesses that identified broadband as their main type of Internet connection as at 30 June 2007, in each employment size category.
(b) For the purposes of confidentiality and to maximise data availability, some output categories have been excluded due to the small number of contributing businesses.

The main type of broadband connection used was DSL, at 78%.

A third of businesses employing 200 or more persons identified Cable as the main type of broadband connection, more than twice the proportion of any other employment size range. Notably, 4% of businesses with 0-4 persons employed reported their main connection as Mobile Wireless, the highest of any employment size range. This type of broadband connection was most common in the Other Services industry, at 7%.


Internet commerce

The 2006-07 BCS measured the proportion of Australian businesses using the Internet or web to place and/or receive orders (i.e. the incidence of Internet commerce). Refer to Explanatory Notes 22 and 23 for the definitions used.

Internet commerce(a), by employment size - 2006-07
		Employment size
		0-4 persons	5-19 persons	20-199 persons	200 or more persons	Total
		%	%	%	%	%
Proportion of all businesses which:
	placed orders via the Internet or web	r34.1	r48.6	r51.8	r69.2	r39.8
	received orders via the Internet or web	r19.7	r29.0	r30.7	25.9	r23.3
r revised
(a) Data in this table were originally published in June 2008 in the release Summary of IT Use and Innovation in Australian Business (cat. no. 8166.0). Minor revisions have occurred and in all but one instance these were 0.4 percentage points or less. For further information refer to Introductory Notes.

Placing orders

All businesses were asked to indicate if they placed orders via the Internet or web. An order is defined as a commitment to purchase goods or services, whether or not payment is made via the Internet or web.

The proportion of all businesses that placed orders via the Internet or web during 2006-07 was 40%.

The likelihood of a business placing orders for goods or services via the Internet or web increased for each successive employment size range. For example, the proportion of businesses with 200 or more persons that reported placing orders via the Internet or web was more than double that of businesses with 0-4 persons (69% and 34%, respectively).

Information Media and Telecommunications had the highest proportion of businesses which placed orders via the Internet or web (68%), marginally higher than Professional, Scientific and Technical Services (63%). By contrast, Transport, Postal and Warehousing had the lowest proportion of businesses (21%) placing orders in this manner.

The proportion of innovation-active businesses that placed orders via the Internet or web during 2006-07 was 55%, compared to 31% for non innovation-active businesses.


Receiving orders

All businesses were asked to indicate if they received orders via the Internet or web. An order is defined as a commitment to purchase goods or services, whether or not payment is made via the Internet or web.

Just over a fifth of all businesses reported receiving orders via the Internet or web. The propensity to receive orders via the Internet or web increased for each of the three smaller employment sizes, ranging from 20% to 31%, however the proportion for businesses employing 200 or more persons was lower than the 5-19 and 20-199 employment size ranges.

Businesses in the Information Media and Telecommunications industry, at 40%, reported the highest proportion for receipt of orders via the Internet of web.

Innovation-active businesses (36%) were more than twice as likely to receive orders via the Internet or web than non innovation-active businesses (16%).


Income from orders received over the Internet or web (Internet income)

All businesses which reported receiving orders via the Internet or web were asked to indicate what proportion of their total income from sales of goods or services could be attributed to those orders (i.e. Internet income). The estimated value of Internet income was $68 billion, or 3.5% of total income from sales of goods or services.

Internet income as a proportion of total income from goods or services(a)(b), by employment size, by innovator status - 2006-07
	Employment size
	0-4 persons	5-19 persons	20-199 persons	200 or more persons	Total
	%	%	%	%	%
Innovation-active businesses	6.8	4.0	4.0	3.7	4.0
Non innovation-active businesses	2.7	2.6	1.7	3.6	2.7
All businesses	4.2	3.2	3.1	3.7	3.5
(a) Proportion of total income from sales of goods or services attributable to orders received via the Internet or web during the year ended 30 June 2007.
(b) Estimates related to Internet income should be used with caution, refer to Explanatory Notes 22 and 23.

Across each successive employment size range, innovation-active businesses reported higher proportions of total income from sales of goods or services attributed to orders received via the Internet or web than non innovation-active businesses. This difference was particularly notable for the three smaller employment size ranges.

Businesses in Transport, Postal and Warehousing (which includes air transport) reported the highest proportion of Internet income (9%), yet this industry was at the lower end of the range for receipt of orders via the Internet or web (13%). Businesses in the Retail Trade industry reported the fourth highest proportion for receipt of orders (31%), however, the proportion of Internet income was at the lower end of the range (1%).