By Gregory A. Farley

Despite widespread fears that encryption technologies have not yet made Internet transactions 100 percent secure, at least 15 percent of the people using the World Wide Web in the U.S. and Canada have used it to purchase goods or services, according to the Spring '97 Demographic and Electronic Commerce Study published jointly by CommerceNet (an industry association for promoting and building electronic commerce solutions for the Internet) and Nielsen Media Research (the TV ratings company). And that percentage has almost certainly increased in the seven months since the report was issued. The study also found that the number of consumers surfing the Web to gather information before making a traditional purchase doubled, from 19 to 39 percent. Nearly three out of four (73 percent) use the Web to search for information about specific goods and services.

"The combination of increased general usage and growth of shopping as an activity paints an extremely promising future for electronic commerce," said Stacy Bressler, vice president of marketing for Nielsen. "This confirms the value proposition for companies planning to use the Internet as a marketing tool."

It's telling, also, that Nielsen is expanding its reach into the cyber realm. "There are a lot of companies out there that want to determine and deliver Internet ratings information," said Jack Loftus, vice president of communications at Nielsen.

"They say 'We want to be the Nielsen of the Internet,'" Loftus said. "And so do we."


Would you like more proof?
Late in July the world's two largest credit card companies, Visa and MasterCard, announced that they had agreed to adopt the same encryption standard for electronic commerce and financial transactions. The two credit card giants, and others, will begin testing the SET (secure electronic transaction) standard later this year. It's a sure bet that these two companies, once satisfied that they can conduct business securely, will go to great lengths to allay consumer fears and encourage online purchasing.


Who is shopping online?
While no one yet has funded the elaborate Internet research that would provide the detail Nielsen provides to television networks, the CommerceNet/Nielsen study does include some demographic information. Of the 220 million people older than 16 living in the U.S. and Canada, 23 percent were using the Internet on a regular basis. The percentage of professionals and managers using the Internet (39 percent) is far higher than in the general population (25 percent), but the ratio is declining. In the fall of 1995, 50 percent of Internet users were professionals or managers. (These data were current when issued in March 1997, but as Nielsen's Loftus suggests, "Six months is forever when you're talking about the growth of the Internet.)

The Internet gender gap is also closing somewhat. In the last half of 1995, the CommerceNet/Nielsen study reported that 34 percent of Internet users were women. Eighteen months later, women accounted for 42 percent of Internet usage. However, the study found that men were much more likely to make purchases online (and they bought computer hardware and software more than anything else).


The future's so bright ...
The company that provides cable television service to my home has been advertising for months its broadband capabilities ... more channels, interactive programming, superfast Internet access via cable modem. But the company is taking its sweet time upgrading its network. It may be Christmas 1998 before these expanded services are delivered to my home. I'm excited about what these new technologies may deliver, but I'm also afraid that by the time I have access to them, they'll be obsolete.

It's the curse of technology. In some respects, it advances far too quickly; in others, far too slowly. Buying hardware just about always proves the point. The money you spent to buy a computer a couple of months ago would buy a faster, more powerful computer today. But improvements in operating systems — the software that makes things happen inside your computer and the interface that lets you direct its actions — evolve much more slowly. Windows 98, for example, will have been three years in the making. And while Macintosh OS software has been evolving and meeting its release dates (more or less) over the last 12 months, the revolutionary top-to-bottom OS makeover it undertook to address the Windows 95 threat is still a year away.

One key aspect of OS upgrades common to both the Apple and Microsoft camps, according to what I've read in magazines, is increased integration of Internet connectivity and applications. It seems like every large technology company believes that the future of business computing (and recreational computing, too) is closely tied to the Internet, and it looks like just about everybody else concurs.

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