Business Standard: February 23, 2010
Chennai/ Bangalore: The number of users who surf the internet on personal computers (desktops and laptops) may not have grown as fast as the industry expected it to. Innovative data plans offered by telecom operators, and reduction in prices of internet-enabled handsets are expected to make up for the gap with an increasing number of users surfing the net on their handsets.
The number of people hooked on to mobile internet in India, according to Google, now has more than doubled, from about 8-10 million in the beginning of the year 2009. The company says March-April last year was the inflation point in terms of traffic to Google Mobile, when it saw a four-fold increase in Google searches on mobiles.
“The year 2009 was big for us. We used to think that India is basically low-end mobile market with users having no appetite for data consumption over mobile. But towards the February and March timeframe in 2009, we started seeing a sudden spike in traffic in mobile Internet space. We analysed the data only to find that this is the real growth and the industry is growing,” says Alok Goel, product manager, Mobile, Google India.
This, despite the fact that the Internet & Mobile Association of India (IAMAI) had recently estimated the number of mobile internet users to be around 2 million. Industry experts reason that there are a little over 500 million mobile phone subscribers in India and with the prices of internet-enabled handsets falling, the number of people who surf the internet on their mobiles presently hovers around the 10 million mark.
The low cost of a general packet radio service (GPRS)-ready mobile handset is a major factor which is driving growth. For instance, an internet-enabled handset costs at least Rs 5,000 almost a year ago. Today, a customer can buy a GPRS-enabled handset for as low as Rs 2,000.
Tata Docomo, a relatively-new entrant in the cellular market in India, says about 40-45 per cent of its subscribers have GPRS activated on the mobile connections “leading to healthy data usage”. “While it is still early days for us to put an annual growth figure given that we have been around for just over six months, data is one of the fastest growing revenue streams for us,” says Deepak Gulati, President, Tata Docomo.
The company sees mobile internet usage happening for messaging, e-mail, social networking and entertainment. “Social networking is one of the fastest-growing areas and mobile Internet fits perfectly into the scheme of things as it allows friends to remain in constant touch irrespective of the time or their location,” adds Gulati.
Most cellular operators that are seeing a huge traction in the mobile internet user base, say that the plans being offered to subscribers have also become a major factor driving mobile internet usage. Cellular operators like Airtel, Tata Docomo, Aircel have introduced innovative data plans to help users get unlimited access to data for less than Rs 100 per month.
Aircel’s pocket Internet cards, for instance, are available for just Rs 98 per month (the company also offers a 3-day plan for Rs 14) and give unlimited browsing, gaming, music. In fact, before launching its campaign in traditional media, Aircel used the Facebook to launch the campaign for pocket Internet card since the purpose was to communicate the message to the youth first. “We are the first to democratise the product (mobile Internet). We have nearly 31 million subscribers now across 18 circles of which a significant number of subscribers use pocket Internet,” an Aircel spokesperson said.
Soon after Aircel introduced pocket Internet card in May 2009, Google saw a “50X increase in Internet usage on Google Mobile by Aircel customers”, according to Goel.
India’s number one cellular service provider Airtel, too, offers data plans at Rs 95 a month. The company is seeing significant increase in mobile Internet users in rural area because of the lack of proper broadband connectivity there. Recently, Tata Docomo has launched a monthly pack for Rs 48 with a 30-day validity and 100 MB data transfer limit during the day and 2GB data transfer during night. The company has now customised GPRS packs which allow customers to get unlimited Internet access for Rs 5 per day.
“Most of these plans are non-confusing with no hidden charges which seems to have done away with the fear among the users on the cost associated with browsing the Internet on mobile,” says Rutvik Doshi, product manager at Google India. He said the devices are also becoming cheaper and smart phones are available in the Rs 7,000-10,000 price point which has made the consumers affordable to but them.
“The trend of using mobile phones for Internet access has already started picking up and we will only see this trend grow manifold when 3G services are launched,” adds Gulati of Tata Docomo.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.