User Characteristics

Despite the constraints listed above, between ten and twenty million users are already connected to the Internet according to various surveys conducted in 1995 and 1996. One limiting factor for more widespread Internet use is the cost. To connect to the Internet a typical home-based user needs a computer, a modem, a telephone line, and an account with an Internet service provider. Even more desirable is a faster direct connection using Ethernet or ISDN instead of modem-based phone dialing, but because of costs associated with direct connections, most home-based users suffer from slow and unreliable connections via ordinary phone lines. While the telephone companies and cable companies have proposed to set up an information superhighway that will solve the transmission bottleneck for many years, their willingness to invest in this has been limited by the current use of the Internet, which is more informational than commercial, and thus reduces consumers' willingness to pay for upgraded services.
In the meantime, reduced personal computer prices are leading to a rapid increase in the number of home PCs, another prerequisite to Internet hookup. According to a 1996 survey, almost 40percent of all U.S. homes now have one or more PCs, and this increase is still growing. The number of homes with PCs in 1995 was 16 percent. Growth is also seen among low to middle income families as well as among the over 60 population. Some key demographic figures of Internet users were revealed by the 5th World Wide Web survey done by the Graphic, Visualization & Usability Center of Georgia Tech University. In 1996, the average user was 33-years-old with a mean household income of $59,000. Over half of the respondents had either educational occupations or computer-related jobs (60 percent). Among the rest, 30 per cent belonged to professional or management occupations. Of all the respondents about 32 percent were female. Even though this survey has a clear sample selection bias (based on voluntary participation), it generally confirms that Internet users are young, male professionals with higher than average income. Nevertheless, the trend from the last two years shows that the percentage of female Internet users and users in other age groups has been increasing. The same survey also polled users on how willing they were to pay for access to web sites. Interestingly, a full 65 percent said they would not pay a higher percentage than found in previous surveys. The authors attributed this to the fact that people primarily used the WWW for entertainment and browsing and that they already paid connection charges. About 12 percent said that they were willing to pay some fees on a subscription model, while another11 percent would agree to pay on a pay-per-view basis. Although different payment systems would likely be based on the type of information sold rather than on consumer preference—a subscription model would be relevant for large databases or newspapers that offer updated information, whereas for one-time use information, pay-per-view would be appropriate—the survey findings raise the important question of how access charges and payment for contents will be managed in the future.