Internet Revolution Still Bypasses Rural India

by CXOtoday News Desk    Mar 27, 2015


The Digital India mission is already underway in India, luring tech giants such as Google, Microsoft and Cisco etc to join the race. The Internet is supposed to change the way we live and work. Despite the hype, a study conducted by Pew Research Center reportedly found that only 20 percent of India’s population has access to the Internet and that rural India is much ignored in the country’s rural population.

The study further reveals, only 14 percent of the people in the country actually own a smartphone. Moreover, it says that 65 percent of Internet users in the country use social networking sites while 55 percent have at some point used the Internet to search for prospective jobs. The study reportedly found that young, well-educated urban people with English reading and speaking skills tend to use the Internet more.

According to Pew Research Center, approximately 42 percent of the respondents felt the Internet to be a bad influence on morality, with 29 percent considering its influence to be a good one. In India, the challenge is to enable rural India tap into the economic potential of the Internet.

Another report published in January this year by Internet & Mobile Association of India (IAMAI) and IMRB International shows that strong adoption of cheaper smartphone and affordable data plans will help in raising the number of mobile Internet users in the country to 213 million by June this year. But, despite the staggering numbers, when it comes to the actual reach, the country needs to address several critical challenges.

“The key challenges in achieving a high broadband penetration in these areas include limited access, low relevance and high cost,” says eminent researcher Ashok Jhunjhunwala.

He believes that the Internet is primarily being used as a medium for social networking and entertainment in the country, while its immense potential in enabling widespread access to education, healthcare, banking, jobs and access to government services remain largely untapped.

Read more: FB, Microsoft, Google Hunt For Treasure In Rural India

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.”

The McKinsey study also reveals, while urban India continue to account for a large percentage of the mobile Internet users across the country accounting for 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 silver lining is that tech majors such as Facebook, Google and Microsoft and several others are in a race to capture more rural and non English-speaking Internet users. On one hand, the initiative by these tech majors can not only help in bridging the urban-rural divide, on the other, it can help these companies sell more online advertising on the web and tap into the millions of Indians who own mobile devices.

While the tech giants and several of its partners are already gearing up to woo rural India, experts believe that only a collective effort can drive this disruptive change through strategic planning and cooperation by the Government, academia, industry and civil society.