11:26 December 01, 2011
Internet in India: A web of Net Gains
India’s internet saga is all set to scale peak heights in the coming years, with a growing user base and the impressive proliferation of both connectivity and device technologies.
By the year 2015, India’s internet user base is expected to touch 300 million. This expected three-fold jump in internet usage is representative of a conducive environment that can be summed up in the form of three factors:
Although our internet speeds and penetration levels are significantly lower than the western world, things are improving as the combined outcome of several enablers:
- Lowered access charges (as much as a 40 percent drop in 2 years) has made internet usage more and more affordable. To top it all, the whole range of smart phones, tablets and notebooks are flooding the market with alluring price tags.
- The introduction of 3G high-speed wireless mobile service is a quantum leap in last-mile connectivity.
- The growing adoption of internet-based lifestyles by India’s youth is by far the best motivation for the growing penetration
Although Indian businesses over the net do not compare well with their western counterparts in terms of size, the ongoing and forthcoming Venture Capital & Private Equity big-ticket deals spell a bright future for the players in this segment. Already stock market success stories like MakeMyTrip are making waves all over. Those companies with a strong presence in key domains like travel & tourism, job and placement portals and specialty retail stand to gain the most.
Currently at a mere 0.1 per cent of India’s retail market, this segment is the most promising vehicle spearheading the Indian internet revolution. Thanks to the innovative pricing models, pay-on-receipt schemes, robust technology, secure transactions, more and more people are being drawn towards this faster and effective way of conducting business - equally both from the supply and demand sides. Already, names like Flipkart are emerging in the B2C space while established players like Futurebazaar are revamping their operations to keep pace with the changing times. Amazon’s entry into India slated for 2012 will only fuel competition in this already bustling segment.
Many companies in the e-commerce space are likely to benefit from the market upswing; a case in point is Info Edge, with its dominant presence in the online recruitment services market and forthcoming investments in other key domains.
Fast n Furious Facts
- With a miniscule internet penetration of 8.5 per cent and a mere four listed internet companies, India already commands the world’s third-largest internet user base. Imagine the scope ahead!
- India’s internet businesses are likely to be the fastest among India’s corporate sector players to achieve the annual revenue mark of USD 100 m.
- InMobi, an Indian player, is Google’s prime competitor in the mobile ad network space.
- Vernacular Print Ad spends in India are as high as 50 per cent of the overall print advertisement expenditure. This spells great news for regional-language web portals.
- Indians book more airline tickets than the Chinese, representing a handsome share of 25 per cent of the overall air bookings.