India set for online surge

19 September 2011

NEW DELHI: The Indian internet population could triple in size during the next three years, according to estimates from Google, the online giant.

Speaking to the Wall Street Journal, Rajan Anandan, Google's Indian country head, predicted the country's web audience would grow from 100m users at present to 300m in 2014.

Moreover, the current internet penetration level is just 8%, suggesting considerable long term room for expansion exists, boosted by rising smartphone uptake and improving infrastructure development.

"Despite a lot of the infrastructure challenges we have as a country, 100m Indians are online, they're spending a huge amount of time online and they're doing a varied set of things online," said Anandan.

Internet advertising expenditure now stands at $200m a year in India, from a global total of $80bn, while local ecommerce sales have reached around $5bn, trailing the $80bn logged in China.

However, Google has found that 65% of web users in India who are looking to buy a car use this channel when researching potential acquisitions. "[This could] have a huge impact on advertising as well as commerce," said Anandan.

Similarly, the company reported 90% of netizens interested in making purchases from the automotive or telecoms segments regularly go online, but brand owners in these industries are lagging behind.

Anandan said: "You should actually have a digital first strategy. That's not to say you shouldn't do significant TV advertising, but for many industries digital today can not only reach the audience that's most valuable to them but also target them in a very interesting way."

Vizisense, the research firm, reported that Google's search engine has 63m users in India a month, alongside 23m users for YouTube, the video platform, and 3m users for Google+, the social network.

Orkut, another social network owned by Google, has 11.1m monthly visitors, now some way adrift of Facebook, on 42.7m.

Anandan argued a large proportion of the 200m people coming online in the next few years will primarily use mobile devices, adding that the cost of appropriate smartphones must fall from today's $140 to $80 or so to aid this process.

Government involvement is also vital to ensuring the web continues to develop. Anandan said: "There needs to be a policy framework and a set of policies that are conducive to the growth of the internet."

Data sourced from Wall Street Journal; additional content by Warc staff