The number of Irish people accessing the Internet from home is significantly behind the rest of Europe. This level of consumer reluctance could hinder Ireland's efforts to become an electronic commerce leader, according to a new report by future research group, Amarach Consulting.

At the moment 300,000 people in Ireland use the Internet, but two thirds of these are through the workplace. The research, which was commissioned by Internet World '98, concludes this level of penetration is only a third of that in the US. The slow uptake is largely attributable to high telecom charges, though Amarach predicts this is likely to change with deregulation of the telecommunications sector, increasing speeds of Internet access, and the growth in online banking.

The survey found the gender bias that exists in the US does not appear to exist here. In the US, twice as many men as women say they use the Internet at home and in work, and even more say they use it at work only. In Ireland there is an even split between the sexes in those who use the Internet at work, though of those who use the Internet at home three quarters are men.

The Irish Internet user has been identified as a powerful consumer, with 71 per cent falling into the biggest spending ABC1 category, and a third owning credit cards. That is more than twice as many as most Irish people. At the same time the online surfer tends to be young, single and living in urban areas. They are not price conscious, with only 18 per cent looking for the cheapest products when they go shopping.

However they are not likely to be loyal to the Irish market, as only 29 per cent believe that products made in Ireland are better than those from other countries. And where they were offered a range of products or services from another Euro currency region at 10 per cent discount or more, Irish Internet users were "very likely" to shop elsewhere, even for products like cars and personal loans.

The lack of Irish companies shipping products locally was set out as one reason for the slow take up in electronic commerce here. At the moment Internet shoppers are deterred by shipping costs and the inconvenience of returning defective goods to overseas markets. However there is nothing to indicate they have an aversion to the electronic process itself, and as online trade develops economies of scale will emerge where the overseas trader will be able to ship goods at a relatively low cost.

But as a recent Irish Internet Association survey found, nearly 30 per cent had purchased something online in the year to last April, and a further 23 per cent said they intended to purchase something between then and now. Given this emerging market, Amarach concludes more goods need to be made available to Irish people locally online.

Drawing from research conducted by Davy's Stockbrokers and Forrester Research in the US, the report predicts the US multinational located in Ireland could be strong drivers of electronic commerce development here. While European Internet revenues are expected to remain significantly behind those of the US for the foreseeable future, Ireland's electronic commerce market is expected to be worth at least £400 million by 2001. Last year, electronic commerce transactions in Ireland were valued at less than £10 million.

Internet World '98 takes place on October 17th and 18th (Consumer Show) and October 20th and 21st (Business Show) in the RDS Main Hall.