Interactive platforms creating USD 98 bn consumer surplus in India

Rich Interaction Applications (RIAs) such as Google Hangouts, iMessage, and WhatsApp, as well as India-based applications such as Hike Messenger, JioChat Messenger, and Nimbuzz create a consumer surplus of USD 98 billion in India, equivalent to 4.3 per cent of India's GDP as of 2016, a report published by WIK, a German Research and Advisory Institute for Communications Services, and Broadband India Forum stated.

The report titled "The Economic and Societal Value of Rich Interaction Applications (RIAs) in India" found that each user of RIAs in India receives on average of USD 249 of consumer surplus annually. Applied to the entire population-not just RIA users-this results in USD 74 per capita.

The report was unveiled by Telecom Secretary Aruna Sundararajan and senior dignitaries of the broadband industry, and is the first to focus directly on the value added by Rich Interaction Applications (RIAs) for consumers in India.

The study establishes that these applications play a disproportionately important role in India when compared to other Asia-Pacific (APAC) countries. In fact, a consistently larger share of internet subscribers in India than in any other APAC country uses these applications.

A survey of internet subscribers in India further confirmed that RIA users typically utilise at least five out of six RIA functions. The six core functions of RIAs analysed in the study include ordinary calling, video calling, texting, sending pictures, sending videos, and group chats. The analysis of the survey further established that RIA usage on average saved 803.9 minutes per week.

"India continues to be the third largest app economy globally. At the outset, our study established that the RIA's play a substantial role in India from a socio-economic perspective, creating a consumer surplus of USD 98 billion in India. Therefore, as compared to other Asia-Pacific (APAC) countries, India will reap additional benefits from RIA's considering a consistently larger share of internet subscribers in India using these applications as compared to other APAC countries," said Dr Rene Arnold, Head of Department Markets and Perspectives, WIK.

The study established that each new and innovative RIA entering the Indian market will create many new jobs. RIAs are simplifying trade, job searches and citizen participation in policy formation. RIAs help new businesses enter the market, increase their visibility and connect them to potential customers.

Further, RIAs can bridge the digital divide by offering new options to individuals who otherwise have limited access to telecommunications services and little knowledge about more complex computers. Indeed, if used well, RIAs could be a critical tool to drive the Digital India Programme.

"The regulatory ecosystem in India is evolving and is focussed on the ease of doing business and ease of facilitating innovation. Considering the significant impact of apps ecosystem on the country's economy, a constant dialogue between policy makers and the industry stakeholders will be critical to unlock the true potential of the internet and app ecosystem in India," said TV Ramachandran, President Broadband India Forum.