Internet and Electronic Commerce Indicators Update

The Internet infrastructure supporting electronic commerce, examined in this report, continue to show explosive growth rates in the OECD area according to the latest indicators.

By July 2001 there were more than 133 000 secure servers in the OECD area representing 94 per cent of the global total. Between July 2000 and July 2001 the OECD total grew by 41 per cent.

Between July 2000 and July 2001 the number of Internet hosts in the world increased from 84 million to 117 million, of which 95.6% were in OECD countries, according to the survey undertaken by Telecordia's Netsizer.

The growth of electronic commerce is still being propelled by economic developments in the United States. The number of secure servers in the United States increased by 31% , between July 2000 and July 2001, to reach 86 000.

The Member countries leading in use of secure servers for electronic commerce, on a per capita basis, are Iceland, the United States, New Zealand, Canada and Australia (Chart 1). In July 2001, the US had 315 secure servers per million inhabitants compared to Canada (198), UK (133), Germany (78), Japan (63), France (33), and Italy (22). The improved performance of the United Kingdom, coinciding with the increasing adoption of unmetered tariffs for Internet access, is worthy of note (Chart 2). The use of secure servers has also substantially increased in Japan. In that country unmetered rates became available for ISDN users in advance of widespread broadband availability. It is expected that broadband access will further drive the take up of electronic commerce but the penetration rate is still small, in most countries, relative to dial-up access.

In July 2001, the United States had 275 Internet Hosts per 1000 inhabitants. This compared with 183 per 1000 for Canada, 70 per 1000 for the United Kingdom, 50 per 1000 for Germany, 48 for Japan, and 27 per 1000 for France. Chart 3 shows the penetration rates for all OECD countries as at July 2001. Current penetration rates for some OECD countries are available from Telcordia's Netsizer .

Chart 4 shows the penetration rates of Internet hosts and secure servers. There are six countries ahead of the OECD average on both scales - Canada, Finland, Iceland, New Zealand, Sweden and the United States.

The OECD regularly undertakes comparisons of Internet access prices. The most recent comparisons are for August 2001. Chart 5 shows a correlation between the penetration of Internet hosts and the average price for Internet access, as recorded in successive OECD surveys, from 1995 to 2001.

Internet surveys of secure servers and hosts provide key indicators of Internet development and may be used as one potential indicator of comparative Internet development between countries. Historical data is available in the OECD Communications Outlook 2001. These data are formulated from the Secure Socket Layer (SSL) survey undertaken by Netcraft .

Surveys of Internet hosts are undertaken by several entities. Network Wizards , on behalf of the Internet Software Consortium (ISC) , undertake the longest running host survey. This survey is carried out every six months. Alternatively, RIPE conduct a survey of Internet hosts every month for countries in their region. A third source of statistics is Telcordia .

The OECD regularly undertakes comparisons of Internet access prices . The most recent comparisons and background on the methodology are available.

The Netcraft SSL Server survey provides one of the best available indicators of the growth of electronic commerce on the Internet. Whereas, the leading search engines only cover http sites, Netcraft also undertakes a secure socket layer (SSL) survey. The SSL protocol was developed by Netscape for encrypted transmission over TCP/IP networks. It sets up a secure end-to-end link over which http or any other application protocol can operate. The most common application of SSL is https (i.e. ssl-encrypted http), a leading enabler for electronic commerce over the Internet. For example, a user purchasing a product can use this technology to securely purchase goods and services over the Internet.

Network Wizards define an Internet host as a domain name that has an associated IP address record. This would be any computer system connected to the Internet (via full or part-time, direct or dial-up connections), such as oecd.org. The Network Wizards survey includes all country code Top Level Domains (ccTLDs such as .be for Belgium) and generic Top Level Domains (gTLDs such as .com) and is undertaken every six months. One qualification that needs to be made is that host data, do not indicate the total number of users who can access the Internet. Surveys of Internet hosts may only be interpreted as the minimum size of the 'public Internet', as it is impossible to determine the number of users accessing services via each host. redistribute hosts under domain names such as .com, .net and .org to individual countries.

Another source of host statistics is the NetSizer, Internet Sizer of Telcordia Technologies. This site provides daily updates of number of Internet hosts based on a random sample of IP addresses sampled throughout every day. Because NetSizer collects and analyses the data continuously, estimates are provided on a real time basis. Telcordia provides hosts by country as well as by top level and second level domains. The former is computed by redistributing the hosts with three letter domains (e.g. com, net, etc.) to individual countries and then adding them to the hosts by two letter country domains.

For background information refer to " Internet Infrastructure Indicators " and the Communications Outlook 2001 .