The 'India Digital Future in Focus 2013' report, from the digital metrics company, Comscore, offers food for thought. It indicates an acceleration of some trends, which should interest businesses and policy-makers. In particular, the user-base for the internet in India grew by 31 per cent in March 2013 over the same month in the previous year. By March 2013, India had the world's third-largest internet population (aged above 15), numbering about 74 million home/office personal computer (PC) users and 145 million mobile net users. This is close to the estimate of the Telecom Regulatory Authority of India that there are 165 million surfers in the country. About 14 per cent of traffic was generated on mobile. Broadband access remains a problem: Just 15 million connect through wired broadband, and the official Indian definition of broadband is 512 Kbps, a quarter the speed of the global standard of 2Mbps.
Growth has remained high since March 2013, with good 3G uptake between April-July 2013, after service providers cut rates and improved coverage. There will be another jump if 4G rollout is expedited. Demand is being suppressed by infrastructure constraints. It behoves policy-makers to remove bottlenecks preventing the delivery of faster fat-pipe services and high-end mobile internet. Reflecting India's demographics, its internet population is young, with 75 per cent of surfers aged under 25, though the 35-44 age cohort are the heaviest users. The gender ratio is skewed at 39 per cent female - the global average is 47 per cent.
In terms of usage, over 91 per cent of surfers use search, 86 per cent use social media and entertainment, and 60 per cent visit retail sites. News is consumed by 57 per cent; 49 per cent blog; 38 per cent use travel sites; 26 per cent follow sports; 8 per cent check on real estate. This is in addition to high penetration of services like email, file transfers, net-banking, financial trading, etc. In social media, entertainment and search, Google and Facebook dominate. Facebook is the stickiest at 217 minutes per month per user. Google holds 90 per cent search-share and YouTube holds 55 per cent video marketshare. The content, in social media, on YouTube and other entertainment hubs has a distinctly desi flavour. It's similar for Linked-in, Twitter, Pinterest and Tumblr, which have all seen fast, committed Indian adoption. Retail is dominated by local players like Myntra, Flipkart, Jabong - Amazon India launched only in June 2013. Apparel, comparison shopping, electronics and software are popular segments. Real estate and travel are also locally driven. Indian Railways is, unsurprisingly, the most visited and transacted travel site. Weather and car-rentals are especially popular on mobile.
The typical user profile is, therefore, a young person, interested in search, entertainment and social interactions. He or she is unafraid to shop online, and may be primarily accessing the internet on a small screen. Comscore says over 111 billion advertisements were pushed at this audience in the April-June 2013 quarter - and that over 54 per cent of those went unwatched. If this is true, the advertising/media industries need to urgently review online offerings. The "unseen" ratio indicates that they have failed to evolve efficient platform-agnostic strategies. Meanwhile, India's e-commerce industry generated $15 billion (approximately '99,000 crore at the current exchange rate) in 2013, with over 75 per cent from travel and hospitality. The online retail industry is a puny $600 million (or about '400 crore), which is a tiny chunk of the $518 billion ('34 lakh crore) brick-and-mortar retail. Unfortunately, there is no reliable way to track the usage of digital currencies like the Facebook Credit though anecdotal evidence suggests this is growing fast. The state-specific barriers brought in for FDI in retail have hampered investments. Online retailers have sidestepped regulation by transforming into "marketplaces". But online marketplaces are notably poor at maintaining service standards, and ruinous due to thin retailer margins. Technopak estimates that online retail could grow to $76 bn (about '5 lakh crore) by 2021 if the constraints were removed. Again, this is something for regulators and policy-makers to ponder.
