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Archive: November 2001 News Headlines
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BigPond Tops In Customer Dissatisfaction

Australia's largest ISP is also its worst, according to the Australian Consumers Association (ACA). The ACA revealed a survey today that disclosed the Telstra's BigPond has the highest level of customer dissatisfaction of any of 18 companies surveyed, while many smaller ISPs were graded as "excellent". The ACA found that Telstra's internet service led the field for technical problems, with its broadband and ADSL services recording particularly noteworthy levels of unhappy customers. "It's telling that respondents with ADSL connections reported significantly more billing and technical problems than those with cable," the ACA said. "They were also less satisfied with the speed of their net connection, technical phone support and the cost of the service." Meanwhile, Australia's largest web hosting company WebCentral today threatened to place its 35,000 customers off-shore rather than continue to pay the AU$180 per gigabyte that Telstra currently levies for bandwidth. A WebCentral spokesperson said that the corporation's quest for profits was likely to induce an "online brain drain" as bad as the physical brain drain Australia suffered in the 1980s when many talented professionals left for higher salaries and better prospects overseas. "The fees we pay for bandwidth are significantly higher than world parity prices. We can only ask: why?"

 

Etailing Beats Retailing - Report

In a report that may well be mirrored in Australia, the US Department of Commerce (DOC) has found that online retailing in the USA is continuing to grow despite the dot.com collapse of 2000 and the current recession in the US economy. The DOC reported yesterday that online retailing grew by around 8.3% in the third quarter of this year (measured against the same quarter last year) while traditional retailers suffered a small slump. They speculate that this may indicate that online retailing is slightly more recession-proof than offline retailing and/or that growth in the area is more measured. The DOC note that online retailing still represents only around 1% of total retail sales in the country, but this nonetheless represents around US$7.5 billion in sales. The DOC study was carried out across a sample base of 11,000 US retail firms.

 

Australians Protest Microsoft Settlement

In what may be one of the most unusual twists in the lon-running anti-trust case against Microsoft, two Australian user groups have contacted the US judge hearing the case and asked him to reconsider the software giant's plans to settle by donating products to poor schools. The Internet Society of Australia and the Australian Unix Users Group have joined a growing chorus of organisations protesting Microsoft's proposed solution to its conviction earlier this year for anti-trust violations: donating US$1 billion in hardware, software and services to the poorest US schools. Both groups said that they were concerned that rather than punishing the corporation, the settlement would reward the company by allowing it to entrench itself in the marketplace. They also expressed concern the proposed remedy only applied to the USA when the results of Microsoft's actions were felt globally. Meanwhile, Apple Computer today said that it was also disgusted by the idea. In a court filing today, Apple CEO Steve Jobs said "we're baffled that a settlement imposed against Microsoft for breaking the law should allow - even encourage - them to unfairly make inroads into education, which is one of the few markets left where they don't have monopoly power."

 

UK Net Users More Sociable Than Non-Users

A new study of UK Net users by the National Centre for Social Research at the University or warwick - reported by Reuters - has found that far from being isolated or anti-social, the average UK net surfer is likely to be more sociable and community-oriented than their non-surfing counterparts. The study found that a third of Internet users belong to a community group in comparison with less than 25% of those who've never gone online. Internet users are also more likely to trust other people and are 50% more likely to be regular church-goers. The study also found that rather than spending less time with their family and friends to use the Net, regular users tend to watch less television instead. All the same, the study found that UK Net users remain more likely to be male, well-off, and well-educated than their non-surfing counterparts, reflecting the same "digital divide" that began to emerge in most advanced Western countries in the 1990s, including Australia.

 

Net = 125 Million Hosts

The Internet grew from 109 to 125 million domains between January and July this year according to the latest Internet domain survey released by Network Wizards (NW) over the weekend. The long-standing survey, which has been analysing the growth of the Net twice a year since 1993, showed that while the dot.com collapse of 2000 had caused some deflation in previous growth rates, the overall global effect was relatively minor. NW report that .NET and .COM are still the most popular domains in the world (accounting for roughly 60% of all domains in existence) followed by .EDU (5%). These in turn are followed by Japan (4%), Canada, Denmark, the UK, USA and Italy (the latter all with close to 2%) while Australia currently sits in 11th place below .mil (ie military) domains on 1.4%. NW estimate that the Net has grown almost 95 times in size since their first survey in January 1993. NW's latest report substantially mirrors the figures reported by NetSizer earlier this month.

 

Net Complaints Rising In USA

Internet-related complaints made it into the top ten US consumer complaints list for the first time this year, according to a poll of consumer protection agencies conducted by the National Association of Consumer Agency Administrators and the Consumer Federation of America. The poll found that 15% of all US consumer complaints over the last year were Net-related, putting the Net in joint 8th place with along with complaints about landlords, mail order companies and telemarketing companies. The poll also found that Net-related complaints have been the fastest-growing complaint area for the past two years, increasing by 62% in 2000 alone. The poll found that US consumers were most likely to complain about problems with ecommerce sites (83%), followed by auction sites (80%) and ISPs (69%). "Business opportunities" and credit cards came in fourth at 29%. The poll also found that ISPs are the fifth most likely to go out of business of all types of companies.

 

Europe Frames New Cybercrime Convention

After 4 years of debate, a new cybercrime convention expected to be signed in Budapest, Hungary on Friday will unite law enforcement officials in 30 nations in the fight against computer criminals. The wide-ranging new convention will deal with most aspects of computer-related crime including hacking, fraud, embezzlement and copyright infringement. Signatories to the convention will be required to set up national centres on round-the-clock standby to help each other, and to deport criminals who fall foul of the new laws to nations where they can be prosecuted. Most advanced nations are expected to sign the convention including the European Union, Japan, South Africa, Canada, the USA and Australia. However, one area of criminal activity that will be excluded from the new convention is incitement to racial hatred. According to reports, the United States expressed concern during negotiations on the cybercrime convention that including racist and xenophobic web sites in the agreement would go against its own First Amendment. As a result, the crime of promoting racial hatred on web sites will be covered by a side protocol to be drafted by next July.

 

Trust "Central" To Ecommerce

Lack of trust is emerging as one of the critical roadblocks to success in e-commerce according to a report by management consultants McKinsey & Co. "Consumers increasingly expect their identity and personal information to remain confidential when they go online to shop," the report's authors say, "and that - coupled with fear of online fraud - is what stops many consumers from even considering digital transactions. They will only become shoppers when marketers overcome the lack of trust that paralyzes many." McKinsey cited a study by the Georgia Institute of Technology which found that only 4% of surfers routinely register at web sites. Two-thirds of those not registering reported that a lack of trust or privacy concerns were the principal reasons why they chose to abandon further dealings with registration sites. McKinsey suggest that improved communications with site visitors, clearly-stated privacy policies and obvious rewards for volunteering information can all help build trust and that the returns from doing so can be significant. They report that etailers who do these things often have twice the rate of repeat business that "untrusted" etailers do.

 

Online Customer Service Improving

A new study by Goldman Sachs, Harris Interactive and Netratings has found that 35% of all Americans report being very satisfied with their online holiday shopping experience this year, and 17% actually found the experience better this year than last. The findings - delivered in the latest eSpending Report - indicate that online retailers may be finally finding their feet in the medium after several Christmases of indifferent service to consumers. Nonetheless, the principal drivers for online shopping still appear to be largely unchanged from 2000: lower prices and the ability to easily compare products and costs on the Net are still the main drivers that led 39% of Americans to shop online during the week ending November 17th. According to the report, 67% of those surveyed said pricing was their main purchasing factor while 59% cited product selection. A further 26% of shoppers indicated that shipping costs were impacting their purchasing decisions this year, with many citing a strong preference for etailers who provide free or low-cost shipping against those charging full freight. The study also revealed that one in three Americans started their holiday shopping as of the week ending November 9th - and a surprising 11% of respondents said they've already completed their 2001 holiday shopping.

 

Paying For Content Not Popular

In what may be bad news for online publishers and syndicators, a new study by Pew Internet & American Life (PEW) has found that few people are prepared to pay for content on web sites at the present time - especially on sites that used to provide the content free of charge. PEW found that 17% of US Internet users (or around 19 million people) have been asked to pay for online content that used to be free. However, only 12% opted to pay for the content while 50% found a free alternative site and 38% simply decided to stop getting the content and/or service from an online source. Further, 12% of Internet users (or around 13 million people) reported to PEW that at least one of their favorite web sites has gone out of business as a result of the dot.com collapse - but 62% of those said they'd since found other sites that offered the same information or service. Interestingly, PEW also found that 12% of Americans say that they or members of their families have lost money investing in Internet companies - and 14% say they know someone laid off by an Internet company or a firm that provides services related to the Internet.

 

US Nixes Net Taxes For 2 More Years

The US Senate voted today to extend its existing ban on taxing online transactions for at least another 2 years until November 1st, 2003. The US Congress originally passed a ban against collecting taxes from online transactions in 1998 to prevent US state and local government bodies from dampening the growth of the Net. However, with more than 50% of Americans now online and the Net accounting for 1% of all retail sales, pressure to introduce new taxes had been mounting in recent months. In the USA, a 1992 Supreme Court decision prohibits states from collecting taxes on transactions unless the retailer has a physical presence in the state - and online etailers have long argued it would be impossible to comply with the roughly 7,500 different taxing jurisdictions that currently exist in the USA. For the interim, the US government appears to agree.

 

Argentina Considers Anti-Spam Laws

The Argentine parliament is considering two new laws which will make it an offence to read someone else's emails or to send spam. The new laws, which have been presented to the Congress by the íSecretara de Comunicaciones, have been largely welcomed by Argentines and follow a trend towards increasingly strong anti-spam legislation worldwide. The first new law - covering emails - would extend Argentine laws covering the privacy of postal mail to emails as well. Anyone caught reading someone else's emails could spend between 15 days and 6 months in prison. However, the new law would still allow employers to read employee emails if they have provided email facilities to staff. The second law - covering spam - would compel spammers to clearly state that their email is spam in the subject line; to identify themselves in the body of the message; and to give an e-mail address which would allow recipients to opt out. Argentines will also be able to enter their e-mail address into a national no-spam list. Spammers who breach any portion of the new law will be liable for US$50,000 in fines: $25,000 to the ISP being used to relay the spam and $25,000 to the recipient. As an extra inducement for ISP's to be vigilant, the new law will also allow ISP's or e-mail providers who detect spam to block the sender's account and start immediate legal action.

 

Europe May Ban Cookies

In a move that may have far-reaching consequences around the world, the European Parliament voted today to adopt an amendment to its draft directive on electronic data collection and privacy to restrict the use of cookies. If the amendment is adopted in December, web sites will have to explicitly ask users if they want to accept them - a move that the advertising industry says could be damaging to business and prove an enormous irritant to consumers. Cookies are small pieces of code used mainly by commercial web sites to track users. They're downloaded by browsers and are used to recognise and authenticate users when they return to a site, often storing such things as passwords and preferences. Cookies are also widely used by the online advertising industry to track consumer behaviour online and help gauge the effectiveness of ad campaigns. However, consumer and privacy advocates have long been critical of cookies for their technical vulnerabilities and potential privacy problems in the event of a computer breach - concerns highlighted by this week's news that hackers could exploit security vulnerabilities in Microsoft's Internet Explorer to read cookie files. Today US privacy groups applauded the EU's stance but the online ad industry said it will lobby strongly against the move.

 

Ad Blocking, Shopping Carts Not Popular

New research by Forrester shows that only 1% of online consumers have used ad-blocking software. The research found that 75% of consumers hadn't even heard of ad-blocking software - but 91% of those polled said that even though they now knew about these applications, they were unwilling to use them or were unconcerned about seeing online ads. In fact, 12% said they found online ads valuable and wouldn't want them blocked. Only 15% said they planned to find out more about ad-blocking software. Meanwhile, a new study by Vividence has found that up to 75% of online shoppers continue to abandon their shopping carts before buying. The main reasons are high shipping prices (72%) followed by browsing and/or comparison shopping behaviour (61%) and changing their mind about the purchase midway through the process (56%). Other reasons for abandoning online shopping carts were that shoppers were saving items for later purchase (51%) or that the total cost of their purchase was too high (43%). Finally, a surprising 41% said they found the checkout process too long, while 35% said too much personal information was required to check out. Additional blocks included an unwillingness to register with a site before purchasing (34%), unstable or unreliable sites (31%) and confusing checkout processes (27%).

 

New Security Hole Found In IE 5.5, 6

A dangerous new security flaw was discovered in Microsoft's Internet Explorer 5.5 and 6.x over the weekend. The flaw potentially allows an intruder to gain access to a user's confidential data by querying their cookie files. A hacker exploiting the security hole could then steal or alter data from web accounts including credit card numbers, usernames and passwords using a specially-crafted web page or email. Microsoft has confirmed the flaw and promised a patch in the near future. The company also said that it's uncertain whether or not the flaw may also affect earlier releases of Internet Explorer, and has recommended that consumers disable active scripting in the interim. In related news: Consumers may soon receive far less information on the nature, extent and seriousness of security defects in common software following an agreement between Microsoft and 5 security companies late last week to impose a form of censorship on news about security flaws. The agreement - announced at Microsoft's Trusted Computing conference - tentatively gives software makers 30 days to patch their products after being informed of a flaw before the public is told about it.

 

Online Auctions Still Top Fraud Sites

Online auctions are still one of the best places on the Net to get defrauded, according to the US-based National Consumer League (NCL). The NCL said today that online auctions accounted for 63% of all online fraud complaints received over the last year. While this was down from 78% the year previously, the NCL report that the average fraud suffered by a typical victim at an online auction was US$478. Other top frauds for 2001, the NCL says, are non-auction sales of general merchandise, Nigerian money offers, Internet access services, Internet adult services, computer equipment or software, work-at-home plans, advance fee loans, credit card issuing and business opportunities. The NCL estimate the average loss suffered by a typical victim of any of these latter scams is around US$850 to US$1100. The NCL offer consumer tips on their web site to avoid being defrauded online. Chief amongst these is advice to consumers to use credit cards when ordering online, since transactions can be disputed if problems occur.

 

Yahoo Escapes French Nazi Ban

In a ruling that may have far-reaching implications, a US Federal Court today ruled that Yahoo is not bound to comply with French laws governing Internet content. Yahoo had been taken to court by French authorities who were attempting to bar the sale of Nazi memorabilia on Yahoo's auction site (or at least French access to such things) earlier this year, saying that the items ran afoul of French anti-hate speech laws. Amongst other things, Yahoo asked U.S. District Court Judge Jeremy Fogel to consider whether French laws could be enforced in the USA, and whether this was reasonable given that the number of items and range of content that could be found potentially offensive in different countries was enormous. Fogel agreed, extending U.S. guarantees of free speech rights to Internet sites hosted in the USA. Yahoo said it was "extremely happy" with the decision. "Judge Fogel's ruling holds that if you have a US-based web site, you are subject to US law and you are protected by the First Amendment. Foreign court orders will not be enforced."

 

Tight Economy Dampens Online Spending

In a study that may be reflected in Australia, new research reported by CyberAtlas has found that economic uncertainty, the war in Afghanistan and the downturn in the US domestic economy means that many consumers are less likely to shop on the Net this holiday season than last. According to a study carried out by Odyssey, only 54% of US consumers who bought online in the first half of this year intend to buy online in the holiday season (against 71% last year). Further, the proportion of online purchasers who've bought anything online in the last six months has fallen to 82% (against 95% eighteen months ago). Over half of online consumers said they're more likely to look for bargains because of the US economic downturn - and 45% say they're likely to only buy bargains.

 

Australians Register 41,000 .Biz Domains

Australians have registered around 41,000 .BIZ domains according to registrar Neulevel - the sixth largest number of any country on Earth. The new domains, which are due to debut on the Internet tomorrow (Wednesday), are the first additional top-level domain suffixes introduced to the Net since it was founded in 1969. According to Neulevel, Australian organisations also ranked third amongst those who applied for a single name. Nonetheless, the number of .BIZ registrations still represents only a fraction of the total .COM.AU registrations currently held by Australian firms (estimated at more than 200,000) as well as .COMs and other suffixes such as .NET.AU, .GOV.AU, .EDU.AU and .ORG.AU. All up, Neulevel said that more than 200,000 people registered .BIZ domains worldwide during the pre-launch sales phase. However, 40,000 of these will not be able to be issued until a Californian class action against Neulevel has been settled. The lawsuit alleges that the allocation system used for popular names constituted an illegal lottery.

 

Net = 127.9 Million Hosts

According to Internet statistics service NetSizer, the Net now connects around 127.9 million hosts and has almost tripled in size over the last 36 months despite the collapse of the dot.com bubble. As expected, Netsizer report that .COM, .NET and .EDU are currently the most crowded domain spaces on Earth. The three together currently account for the overwhelming bulk of host names on the Net. However Netsizer also report that the USA, Iceland and Finland currently have the largest number of hosts per head of population; China, Brazil and Iceland are now the fastest-growing geographic regions of the Net; and the three fastest-growing domains at the present time are .BR (Brazil), .ES (Spain) and .CL (Chile)

 

Security Flaws In Microsoft Passport

Grave security flaws unearthed today in Microsoft's Passport service caused the company to temporarily shut down the Express Purchase service affiliated with the Passport Wallet. The flaws - unearthed after a "30 minute brainstorming session" by open-source programmer Marc Slemko from Seattle and first reported in Wired - potentially allow any hacker to gain complete access to a Passport user's files by exploiting existing holes in Microsoft's systems. Microsoft acknowledged the security problems soon afterwards, shutting off the purchasing option to "remove any danger that consumers could have had their information stolen". In related news: Microsoft shares rose today on the announcement that a settlement may have been reached in its long-running anti-trust case with the US Justice Department and 18 US attorneys-general. Under the terms of the settlement, Microsoft would need to liberalise its licensing to allow computer manufacturers to install non-Microsoft software if they wished to, and to open up its Windows source code to competitors. However, critics protest that this option will allow the company to emerge from its conviction as an anti-competitive monopolist relatively unscathed. The settlement has yet to be accepted by the plaintiffs or the court.

 

Australian Net Declines

The Australian Internet declined by an average 6.5% during October according to the search engines we poll to construct our monthly Australian Internet Growth Index (which has been attempting to measure the number of live Australian web sites - as opposed to the number of registered domains - since January 1996). The decline could be attributable to periodic purging of dead and/or unlinked sites from search engine indexes or to a lack of confidence in the online sector. The November 1st figures (with October 1st figures in brackets) are as follows:

  Australian Internet Growth Index October 2001
  (Figures Show Estimated Live Sites)
  • Brisbane - 8,736 (9,928)
  • Sydney - 41,605 (44,785)
  • Melbourne - 35,164 (38,139)
  • Adelaide - 6,478 (6,929)
  • Perth - 7,284 (7,791)
  • Hobart - 2,848 (3,161)
  • Canberra - 6,681 (7,334)
  • Darwin* - 8,375 (9,045)
NB: The Darwin figure includes rural Australian sites

During October 2001 Australian Cybermalls hosted 74,062 visitors, a rise on September's 62,297. Our visitors viewed 331,508 page displays from our servers, which in turn consumed 15.79 Gb of bandwidth.

 
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