While Australia is making significant strides in closing its digital divide, with marked improvements in internet access and digital skills, the rapid and uneven adoption of generative artificial intelligence is creating new challenges. A comprehensive new report on the nation’s digital inclusion reveals that while foundational gaps are narrowing, particularly among older Australians, a new “AI divide” threatens to deepen existing social and economic inequalities.
The latest Australian Digital Inclusion Index, a collaborative effort by researchers from RMIT University, Swinburne University of Technology, the ARC Centre of Excellence for Automated Decision-Making and Society, and Telstra, paints a complex picture of the nation’s digital landscape. Overall digital inclusion is on the rise, yet persistent barriers related to affordability, education, and geography remain firmly in place for a significant portion of the population. The findings highlight a critical juncture where the promise of new technologies like generative AI could either bridge existing gaps or, if not managed equitably, widen them considerably, leaving the most vulnerable further behind.
Overall Progress in Digital Equity
There is positive news in the ongoing effort to ensure all Australians can access and effectively use digital technologies. The report indicates a significant 8.7-point increase in the nation’s overall digital confidence and capability scores between 2023 and 2025. This reflects broad improvements across the key metrics of access, affordability, and digital ability. The progress suggests that targeted initiatives and a growing societal reliance on digital platforms are bearing fruit, bringing more people online and equipping them with essential skills.
The most substantial gains in digital literacy have been observed among some of the previously most excluded demographics. Australians aged 75 and over saw their digital ability scores jump from 23.3 to 41.5, a remarkable increase that signals a growing comfort with technology among seniors. Similarly, individuals who have not completed secondary education also demonstrated significant progress, with their scores rising from 38.5 to 54.4. These figures underscore a successful narrowing of the skills gap for some of the nation’s most vulnerable groups, enabling them to participate more fully in an increasingly digital society and access essential services in health, finance, and communication.
The Rise of Generative AI
The digital landscape has been fundamentally reshaped by the recent explosion of generative artificial intelligence. The report reveals that this technology has achieved stunningly rapid penetration into Australian society, with nearly half (46%) of the population having already used a generative AI tool. These tools, which can create text, images, and code, have been integrated into common services like search engines and are being adopted across various sectors. This surge presents both immense opportunities for boosting productivity and creativity and significant new challenges for digital inclusion.
Patterns of AI Adoption
Adoption of generative AI is not uniform across the population. Usage is highest among students, with a striking 79% reporting recent use of these tools. Young Australians aged 18 to 34 are also enthusiastic adopters, with 69% having engaged with generative AI. This compares sharply with older demographics; for instance, less than 16% of those aged 65 to 74 have used the technology. The most common application among users is text generation (82.6%), followed by image creation (41.5%). Furthermore, a notable 13.6% of users are paying for premium subscription services, indicating a willingness to invest in more powerful AI capabilities.
Emergence of a New AI Divide
The rapid and uneven uptake of generative AI is fostering concerns about the development of a new “AI divide.” This term describes the gap between those who can effectively use advanced AI tools and those who cannot, threatening to compound existing inequalities. People with lower digital literacy may not only miss out on the benefits of AI but also face greater risks from AI-driven scams, misinformation, and privacy infringements. Because engagement with AI is strongly correlated with existing levels of digital skill and access, there is a clear risk that the same patterns of exclusion that defined the original digital divide will be replicated.
This emerging divide is not merely speculative; international evidence already points to growing disparities in AI capabilities between countries and across industries. In Australia, the data shows that people who speak a language other than English at home report significantly higher use of generative AI (58.1%) compared to English-only speakers (40.5%). While this suggests AI may be a valuable tool for non-native English speakers, the broader trend indicates that access to and proficiency with these powerful new technologies is far from equitable. As AI becomes more integrated into education and employment, these disparities could lock disadvantaged groups out of crucial opportunities.
Persistent Barriers to Full Inclusion
Despite the progress in overall digital inclusion, the report underscores that significant obstacles remain. Approximately one in five Australians still faces substantial difficulties in fully accessing, affording, and using digital technology. These persistent barriers mean that a sizable segment of the population is at risk of being left behind, unable to engage with essential services that are increasingly moving online. The transition to a digital-first economy places immense pressure on individuals who lack the skills, resources, or reliable internet access to participate.
The core challenges are multifaceted. For many, the high cost of internet services and devices remains a primary barrier, particularly as the cost of living rises. This financial pressure has a direct impact on digital outcomes, as households earning less than $100,000 are significantly more likely to struggle with finding and using online government services compared to higher earners. For others, the challenge is a lack of foundational digital skills and the confidence needed to navigate an ever-evolving technological landscape. This skills gap can lead to an inability to manage online security, identify misinformation, or utilize productivity tools, further limiting economic and social opportunities.
Geographic and Socioeconomic Disparities
A stark line divides urban and regional Australia when it comes to digital inclusion. The report confirms that digital inclusion scores consistently trend downwards with remoteness, meaning those living outside of major cities face greater challenges. This geographic disparity affects access to reliable, high-speed internet and limits opportunities for digital skill development. Residents of Tasmania, South Australia, and Queensland all recorded scores below the national average for access, affordability, and ability, while the Northern Territory faces particularly acute access challenges.
Social and Economic Factors
The most digitally excluded groups are often those already facing other forms of disadvantage. Older people, First Nations Australians, and those with lower levels of income and education consistently record lower levels of digital inclusion. However, the report also uncovered a unique trend in remote communities, where residents were twice as likely as their metropolitan counterparts to use AI chatbots for social connection and conversation. This suggests that for some geographically isolated individuals, technology can serve as a vital lifeline. Nonetheless, the broader data indicates that unless policy interventions are targeted and effective, the digital economy will continue to favor the urban, educated, and affluent, leaving the most vulnerable Australians struggling to keep pace.
