The report, titled Jupiter View and compiled from a survey of the internet access habits of 500 Australian households, said 2.6 million households -- or 6.5 million individuals - will access the Net this year. The survey estimated net traffic would increase by more than 50 per cent to 9.2 million individuals in 2003.
The report found that almost one in five Web users had made a purchase online in 1999, but only three per cent said they believed it was "very safe" to use a credit card on the Internet, while 38 per cent believed it was "very unsafe".
While Jupiter Communications' international analyst, Drew Ianni said calculations had not been finalised for the "official" online spend last year, he thought projections as high as $900 million" were optimistic.
With figures derived from the survey, and considering similar statistics from the US, he estimated the total online spend for 1999 in Australia was closer to the $300 million mark.
The survey found that books - 38 per cent of all online purchases, and computer periphals and music -- both at 28 per cent, were still the top online products last year.
Air tickets (19 per cent), and clothing (15 per cent), were followed by computers, entertainment ticketing, and consumer electricals - each valued at four per cent of the total online spend.
Ianni estimated the click through rates of banner advertising on Australian sites to be similar to that in the US, at about 0.005 per cent.
He said the sites that attracted the most advertising revenues were those that had the ability to offer advertisers a "rich profile" on visitors to their site.
The survey projected an increase in the overall online advertising spend from $3.2 billion in 1999, to $4.7 billion this year to $11.5 billion in 2003.
The survey also projected a steady increase in email messages -- from 300 million last year to 1600 million in 2002 -- a larger proportion of which are expected to be in the form of email marketing.