An Indian trade group has came out with a prediction that, after China, India would overtake U.S to become second largest internet user base by December 2015. Argument that supports the assumption so made is a boom in Smartphone ownership within the country.
According to Trade Group Internet and Mobile Association, population of internet users will grow to 402 million in December from 375 million recorded in October 2015, whereas, World Bank claims that China is already out numbered the list with nearly 650 million internet users.
A major portion of this growth is inspired from a boom in mobile-data users, which grown to 276 million in October from that of 159 million a year later. Steep decline in prices of smart-phones in India takes major credit for rise in internet adoption. The average price of smart-phones remained under Rs. 10000, while many company sell an entry-level device priced less than Rs. 7000. On the other hand cellular service provider sells data packages which are as less as Rs.11 for 30 MB of mobile data.
The drop down has resulted in sparking interest towards accessing internet from their mobile devices, these percentage is anything around 94% of adult population. Of the 11 million Indians that the report says will access the Internet for the first time in the next year, two-thirds will do so with a cell-phone.
The startups, technology companies and cell-phone providers are focusing to tap the under-penetrated rural areas of India, where internet user ratio is 1:10 only. Three-quarters of rural Indians who don’t use the Internet say they don’t know what it is for, the report said.
Facebook Inc. is aiming to turn more Indians into web users through its Internet.org initiative, which offers a limited range of Internet services free.
A study carried out by Ericsson in April this year, reveals that, Internet adoption in India was confined to low end computer and meager quality and overpriced broadband connections. However, country is now working on a nationwide fiber-optic network, but many Indians said that Smartphone will remain their only means to access the Internet, as it is cheaper than a personal computer.
The rapid growth in India’s Internet usage helps discuss the reason behind billions of dollars being channelized into Indian startups despite the still-small size of the online market. Indian e-commerce companies compete for the business of around 100 million Indians, generally in cities. According to the report, only one in four Indians in cities say they shop online, and only 5% of Indians in rural areas do so.
But local e-commerce startups like Flipkart and Snapdeal are valued at several billion dollars each by investors betting that India will rapidly catch up to its East Asian neighbors. Certainly, these services and others like Uber’s rival in India, Ola, and restaurant-discovery site Zomato are driving increasing Internet use as more Indians discover how useful the web can be.
Indian smartphone maker Micromax says that its sales are driven by services like WhatsApp, a popular messaging service in the country. It has teamed up with a local service provider to offer free WhatsApp use for users of some of its handsets. Micromax co-founder Vikas Jain said at the WSJDLive technology conference that WhatsApp and Facebook “are the two biggest drivers of Internet use in India now.”
