According to the report Australia ranked number 43 out of all countries hosting malware in 2006 with New Zealand placing higher at number 36. The United States, China, Russia, the Ukraine and the Netherlands rounded out the top five malware hosting countries for 2006.

Trojan-like malicious code, outnumbering Windows specific Internet based worms in 2005, rose to 80 percent of all threats in 2006. In 2005 that figure was 62 percent.

Paul Ducklin, Sophos Asia Pacific head of technology, hinted at Australia's ranking as a bit part result from Internet Service Providers (ISPs) "doing the right thing" and the greater efforts companies are taking to keep services secure.

Ducklin said there is no direct link between malware hosting and botnets as often a computer can be tweaked to send spam but for some reasons could not be used to serve malware.

"Infected e-mail through attachments has gone down to one in 44 and the fact it has fallen is not because there is less malware, but that the bad guys are more determined to create distinct bits of malware, and these bad guys are no longer enamoured with mass mailing malware because it draws attention," Ducklin said.