India To Get 213 Mn Mobile Internet Users By June

by CXOtoday News Desk    Jan 14, 2015

mobile internet

Driven by strong adoption of cheaper smartphone and affordable data plans, the number of mobile Internet users in India is expected to reach 213 million by June this year, says a report. But, despite the staggering numbers of mobile Internet users in India, experts point out when it comes to the actual reach, the country needs to address several critical challenges.

The ‘Mobile Internet in India 2014′ report by industry body Internet & Mobile Association of India (IAMAI) and IMRB International shows that the number of mobile Internet users stood at 173 million at the end of December 2014.

Lack of compelling content

While reports show almost every new user now has mobile phone, Laxman Narasimhan, Director, McKinsey, argues in his blog that the most formidable hurdle to India’s digital promise is finding a sustainable way to deliver attractive returns for content companies at affordable prices for consumers.

Narasimhan believes that India differs from other Asian mobile-Internet leaders, such as Japan and even China, where access charges generate enough revenue for operators to finance the ongoing creation of value-added services, he says.

Narasimhan states that what needs to be focused is local-language content which should be presented in the most compelling way. “What’s becoming essential is voice and single-touch mobile-Internet access for a seamless experience of users.”

Rural woes

According to the study, while urban India continue to account for a large percentage of the mobile Internet users across the country accounting for 143 million by March 2015 and 160 million by June 2015. However, rural India is expected to account for 49 million by March 2015 and 53 million users by June 2015, growing at a rate of 33 percent from October 2014.

“Unless the Internet is equally transmitted to smaller cities and rural areas, India’s GDP from the Internet economy will not see a significant growth,” says Anu Madgavkar, India head of McKinsey’s economics research.

The report also notes that the average monthly mobile bill has increased by 13 percent to Rs 439. The proportion of this amount spend on mobile Internet was 45 percent last year and has now grown to 54 percent this year. As compared to last year, the average monthly spend on mobile Internet has gone up by 36 percent to reach Rs 235.

More than half of the mobile Internet users spend more than Rs 100 but less than or equal to Rs 500 in availing the mobile Internet services, the report said. Nearly 30 percent spend more than Rs 500 on the mobile Internet connection, it added.

Boost to e-commerce

Higher broadband penetration will boost Indian e-commerce market, which is currently pegged at $13 billion is all set to cross $90 billion by 2019, an increase of 700% as per a research by eTailing India. Furthermore, simplifying payment procedure can further play an important role in further increasing online transactions in India.

According to a previous IAMAI report, India was forecast to touch 302 million Internet users (mobile and broadband) by end of 2014, overtaking the US as the second largest Internet market in the world. Cheaper smartphone and affordable data plans will continue to drive this sector.

The total Internet user base stood at 278 million at the end of October 2014 quarter and is estimated to grow to 354 million by June 2015.