Next wave of growth in mobile internet to come from rural India: Study

With 59% penetration, urban India is expected to see a slowdown, says report

The next wave of growth in mobile internet users is going to come from rural areas, where mobile data penetration is as low as 18 per cent. However, rural areas also saw growth of a little over 15 per cent in mobile internet last year, with 57 per cent users being under the age of 25 years.

A report by the Internet and Mobile Association of India (IAMAI) and Kantar IMRB says with 59 per cent penetration, urban India is expected to see a slowdown. Rural India is clearly the next area of growth. Overall, mobile internet users are estimated to reach 478 million by this June, of which urban users will be around 291 million and rural users 187 million. Mobile internet users increased by 17.2 per cent from December 2016 to reach 456 million in December 2017. 

The report said emergence of newer forms of services and apps, along with availability and quality of mobile data, determine the usage of mobile internet. Online communication and social networking have been the top purposes for the past few years. The recent development of digital entertainment has resulted in this category emerging as the top purpose of access in rural India. 

The report says a relatively sharp decline in the number of respondents reporting online finance and transactions across both urban and rural India denote that digital transactions (payments, e-commerce, etc) are yet to attain priority for mobile internet usage, despite the thrust in recent times. 

“However, it must also be kept in mind that online financial transactions have witnessed a rise compared to previous years, and are one of the most promising of services for mobile internet in the coming days,” it adds.

The report also highlights India’s skewed gender ratio in mobile internet usage. “In urban India, the percentage of women mobile internet users stands at 40 per cent. In rural India, women mobile internet users are only 33 per cent compared to 67 per cent male users.”

Mobile internet is predominantly used by youngsters, with 46 per cent of urban users and 57 per cent of rural users being under the age of 25. Urban India has around twice the proportion of users over the age of 45, while the age range of 25 to 44 has almost equal distribution of users in urban and rural areas. 

Another point highlighted is affordability. Average mobile expenditure has been decreasing continuously from 2014. This is reflected in greater affordability of mobile data. Expenditure on voice has been steadily decreasing from 2013 and with the popularity of Voice over Internet Protocol and video chatting; the expenditure on voice services has decreased drastically in recent times.

   Digital world: Rural folks catching up fast

There will be 187 million rural mobile internet users by June 2018

There will be slowdown in urban areas growth for mobile internet, but rural India will grow fast

With just 18% mobile internet penetration in rural areas, there is huge potential for growth  

Gender ratio is skewed for rural internet users, with 67% male and just 33% female57% of rural users are under the age of 25 Digital entertainment top priority for rural users