Ads to jostle more for wired than mobile net: PwC

The internet advertising segment is likely to be valued at Rs 10,000 cr by 2018 and the internet access one at Rs 66,200 cr

Indian advertisers will bet on the wired internet market, where they will spend Rs 8,200 crore by 2018 against Rs 1,200 crore on the mobile internet market. This is despite a likely internet penetration on the mobile of 83 per cent of the population in 2018.

According to a report by CII-PwC India, the internet advertising segment is likely to be valued at Rs 10,000 crore by 2018 and the internet access one at Rs 66,200 crore.

India is expected to have 23 million wired broadband connections and 543 million mobile internet connections by 2018.

"In spite of the potential for internet advertising in India, there are still barriers such as low literacy and inadequate local language content. Mobile-specific ad formats are still in their infancy, and the small screens of smart phones allow fewer ads," the report says.

"The Indian internet advertising market (with projected revenues of $1.8 billion in 2018) is expected to be miniscule in comparison with developed markets such as the US, which is expected to reach revenues of about $66 billion by 2018," the report adds.

Mobile internet penetration in India is at 16 per cent of the population and wired internet penetration at six per cent, according to the report. India had 18.3 million wired internet connections and 220 million mobile internet subscribers, the Telecom Regulatory Authority of India said in December.

"The wired internet advertising market is expected to grow by 26 per cent annually from 2013 to reach Rs 8,200 crore in 2018. The mobile internet market is expected to grow even faster backed by smart phones and high-speed mobile internet," the report adds.

"The bigger question is about the capacity of mobile service providers in India. At 15 per cent penetration, mobile companies have not been able to keep up. We do not know what will happen if that number rises to 30 per cent in the next few years," said Sanjay Gupta, chief operating officer of Star India.