Internet Access, Tracking Growth of

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INTERNET ACCESS, TRACKING GROWTH OF

Tracking the growth of Internet access has become increasingly popular as the Web continues to evolve into a tool for gathering information, communication, marketing, and commerce. According to NUA Internet Surveys, the number of people online increased to 513.41 million in August 2001. Africa accounted for 4.15 million online users. The Asia/Pacific region had 143.99 million Web surfers. There were 154.63 million people with access in Europe, 4.65 million in the Middle East, 180.68 million in Canada and the U.S., and 25.33 million in Latin America. Tracking both access and usage patterns has begun to play an important role in e-business strategies as enterprises see Web surfers and advertisers as potential revenue generators.

Beginning in the mid-1990s, surveys were used as a tool for measuring Internet access. Michigan State University professors Mark I. Wilson and Hairong Li described these surveys in a paper entitled "Measuring Internet Access and Use: Conceptual and Methodological Issues" when they presented at the 1999 International Conference on the Measurement of Electronic Commerce in Singapore. "Surveys can be used in a number of ways to assess the state of the Internet, providing information about both access levels and user characteristics," the pair claimed. Surveys that continue to be used to guage Internet access include general population surveys, online surveys, and random surveys.

In general population surveys, a sample of the general population is taken to compare those that have Internet access with those who do not. Online surveys, on the other hand, are used to discover certain characteristics of those who already use the Internet. Two popular types of online surveys include "one-step" and "two-step" surveys. In a one-step survey, Web surfers are able to participate by simply answering a series of questions found on the Web site of the firm conducting the survey. In 1994, the Graphics, Visualization, and Usability Center (GVU) of Georgia Tech University began using these types of surveys to study Internet access. The GVU would post a survey on its Web site and then solicit participation by advertising in newsgroups, sending email, and by using banner ads on search engine sites. Unlike a one-step survey, a two-step survey involves securing a pool of Internet users who are willing to act as survey participants. Polling companies, including Harris Interactive Inc., select participants from their pools to participate in various surveys. A random survey is conducted via the telephone or through personal interviews. Companies including MediaMark Research Inc. and IntelliQuest Inc. began random surveys in the mid-1990s to gather information about Internet usage.

Along with surveys, Internet access is also recorded through tracking. Two forms of tracking became popular in the 1990s: site-centric and user-centric. According to the aforementioned paper, in a site-centric approach "server log files are analyzed to generate statistics on the numbers of times a Web page was requested and number of users who visited a page or site." The user-centric method, however, tracks Internet access by installing a device on a willing participant's computer that monitors his or her Web and e-mail use.

While there were many organizations that tracked and researched Internet access and usage patterns in the new millennium, keeping tabs on the growth of Internet access was not an exact science. Several factors continue to hinder the accuracy of Web measurement. First of all, the rapid growth of the Internet makes gathering information about its size extremely difficult. While the percentage of growth has slowed since the late 1990s, the number of people accessing the Internet continues to rise each year causing information regarding Internet access to become obsolete in a short period of time. Second, the Web has no spatial or geographic boundaries. Third, tracking Internet access is a relatively new concept, and as such, there is much debate on how to measure the growth of the Web. Lastly, concern exists over standards and the impartiality of those measuring access and usage.

MAJOR INTERNET TRACKING FIRMS

NETRATINGS, INC.

NetRatings was created in July 1997 to provide accurate and timely Internet audience information and to monitor and track Internet audience exposure and interaction with Web-based advertising. The company was established through a partnership with Hitachi Ltd. In October 1998, NetRatings teamed up with Nielsen Media Research to develop and market Internet measurement and tracking services under the Nielsen/NetRatings name. By 1999, the firm had launched its audience measurement service and secured over 100 customers in its first month of operation. Later that year, NetRatings debuted its Internet Investment Strategies service, which catered to the online investment industry by providing information on Internet use and trends in that market. The firm also launched its E-commerce Strategies service, which tracked user activity on commerce-based Web sites.

In September 1999, NetRatings partnered with ACNielsen and eRatings.com to provide global measurement services in countries including Europe, Asia, the Middle East, and Africa. By then, operations spanned the 29 countries that accounted for 91 percent of the Internet population. By the time the firm went public in December, it had launched its Internet Media Strategies service, which offered information on streaming media and Internet connectivity speeds, as well as local market data for businesses seeking demographic information. NetRatings continued its international expansion in 2000, entering the French and Latin American markets. It also forged alliances with the likes of Spectra Inc., Claritas Inc., and Yahoo! Inc. to further develop its Internet usage and measurement services. During that year, the firm released its first report on Internet access and usage in Europe, Asia Pacific, and North America.

In 2001, Netratings joined with Harris Interactive to create eCommercePulse, a service that tracked online consumer spending and behavior. By then, the firm had become a leading provider of audience measurement and tracking tools with over 225,000 tracking meters installed on computers in both work and home situations in 29 countries across the globe. Its customers included traditional brick-and-mortar and consumer packaged goods firms using online marketing and advertising, companies involved in Web-based commerce, advertising firms, media and content Web sites, and investment firms. Through its Global Internet Trends service, it provided its clients with information on worldwide Internet access and usage trends, as well as information concerning Web access in the United States. For example, according to an October 2001 NetRatings report, the Internet population in the U.S. increased by 15 percent in 2001, to 115.2 million Web surfers, and the number of Americans with Internet access increased to 62 percent, up from 57 percent in 2000.

JUPITER MEDIA METRIX

Jupiter Media Metrix is another popular Internet tracking firm. Formed from the merger of Jupiter Communications LLC and Media Metrix in September 2000, the company has over 1,800 clients—including advertisers, media companies, e-commerce and technology-based firms, and financial institutions—that utilize its site measurement and audience measurement services.

Jupiter Communications was formed in 1986 by Josh Harris, who started out writing industry reports relating to the entrance of telephone companies into the information technology industry. By 1989, these reports were quite popular and Harris was hosting annual conferences related to his research. The following year, Gene DeRose joined Harris; soon thereafter, the pair began to shift the company's focus to tracking developments related to the Internet. As the Web evolved into a marketing and selling venue, Jupiter focused on providing research that detailed consumer behavior on the Internet. By 1997, the firm was publishing seven monthly newsletters, dozens of industry reports, and hosting eight annual conferences.

Media Metrix had its beginnings as a product research and development division of market research firm NPD Group Inc. In March of 1996, NPD established PC Meter L.P. to develop and market Internet audience measurement services. The following year, PC Meter changed its name to Media Metrix. Eventually, NPD spun off Media Metrix via an initial public offering, and the newly public firm grew in the late 1990s through a series of acquisitions including RelevantKnowledge Inc. and AdRelevance.

By mid-2000, both Jupiter and Media Metrix were struggling, as many businesses began to cut budgets related to their e-business strategies. As a result, Jupiter agreed to be purchased by Media Metrix in a $414 million deal. The newly formed company, Jupiter Media Metrix, hoped to attract new clients by combining Jupiter's site measurement services along with Media Metrix's Digital Media Audience Ratings service. Site measurement services included visitor statistics, which tracked the frequency of a customer's visit, how much time a customer spent at the site, and how the customer got to the site. The audience-ratings service used real-time meters placed on over 100,000 computers across the globe. The information gathered from these meters provided information on the demographics, behavior, and usage patterns of Web surfers.

While NetRatings and Jupiter Media Metrix provided similar services, both companies measured Internet access based on their own proprietary systems. Because tracking Internet access remained an inexact science, the two company's findings did not always match, a fact which created some controversy. For example, in October 2001, both companies released reports that rated the top Web sites based on number of visits by both at-home and at-work Web surfers. NetRatings' results ranked Microsoft Corp.'s MSN network number three behind AOL Time Warner and Yahoo! Inc., while Jupiter's results ranked MSN number two, ahead of Yahoo!. While both MSN and Yahoo! could claim a top spot over their competitor based on the different reports, those utilizing the rankings as a basis for advertising decisions were left confused, not knowing which site was truly the leader.

In October 2001, NetRatings announced its intent to acquire Jupiter for over $70 million. The merger was scheduled for completion in 2002, and upon conclusion of the deal, both companies hoped to set one standard for Internet tracking. While the outcome of the deal remains to be seen, tracking Internet access and usage patterns will, no doubt, remain an important part of e-business strategy as Web-based commerce and marketing continue to grow.