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NSF PR 03-14 - January 31, 2003
Survey Shows Security and Privacy Remain Major Concerns for Online Shoppers
Third annual Internet Report also reveals that the Internet has become Internet users' most important source of information
ARLINGTON, Va. -- While electronic commerce continues to expand, concern about credit card security and privacy may be preventing many more potential shoppers from making purchases online, according to Year Three of the UCLA Internet Report, released today. However, the survey of 2,000 households also shows that more than 70 percent of Americans who use the Internet now consider online sources to be their most important source of information.
The report reveals that Internet users are slowly reconciling the convenience of shopping and buying online with worries about "hackers" and "too many unknowns" in the process. For example, the number of adults shopping online decreased in 2002, but those who do shop online made more purchases on average.
"People are becoming more comfortable shopping without face-to-face interaction," said Jeff Cole, director of the UCLA Center for Communication Policy, which conducted the survey. "In consumer behavior and elsewhere, we're seeing people becoming more comfortable with the Internet experience."
The UCLA Internet Project is funded by the National Science Foundation, the federal agency that supports basic science and engineering research and education. The project's objective is to survey Internet users and non-users in the United States and abroad for an entire generation and paint a comprehensive picture of how the Internet affects society. The survey looks at who is online and who is not, online activities, media use, communication patterns and social effects, in addition to consumer behavior.
Consumer behavior online is in flux, according to the report. Many survey respondents say they waited months or years before buying online -- but the average waiting period is shrinking. For those who wait, concern about using a credit card far outweighed any other reason. In fact, 8.7 percent of all respondents reported being extremely concerned about credit card fraud because they know someone who has been a victim. And for a quarter of those with concerns, "nothing" will reduce those concerns.
On the other hand, more than 71 percent of respondents indicated they will probably make more purchases online in the future, up from 66 percent in 2001 and 54 percent in 2000. Privacy concerns, while still high, have declined slightly, and the most experienced users show lower levels of concern about credit card security than do new users.
"As the Internet has grown, we as a society have often heard lofty promises about how it would change our day-to-day lives," said Greg Monaco, program director in the NSF Division of Advanced Networking Infrastructure and Research. "Today, the Internet has become a regular part of life. This study is important because it can show us how the Internet has lived up to the promises made, and where there's room for improvement."
With the third year completed, some early trends are emerging from the project:
- When asked to rank the importance of major media, 61.1 percent of users said the Internet was very important or extremely important, surpassing books (60.3 percent), newspapers (57.8 percent), television (50.2 percent), radio (40 percent), and magazines (28.7 percent).
- Home broadband connections (cable and DSL) have shown the most dramatic growth over the three years of the survey. Dial-up access, while still connecting nearly 75% of online homes, is declining.
- Television viewing continues to decline among Internet users, suggesting that Internet users may be "buying" online time from time previously spent watching TV. In 2002, Internet users watched about five hours less television per week than did non-users.
- The Internet remains an important information source for most users. However, the percentage of users who believe the information on the Internet is reliable and accurate has declined.
- More than 80 percent of children go online at home and nearly 75 percent go online at school, dramatic increases in both locales. However, most parents report that Internet access at home has not affected their children's grades. Most Internet users report that their online time has not influenced the time they spend with family or friends.
To download the complete Internet Report 2002, visit the UCLA Center for Communication Policy website: http://ccp.ucla.edu/.
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