Half of Internet users in India only access web via mobile

For many people around the globe mobile Internet is the only access method. This group is referred to as Mobile Only Internet Users, or MOIUs and India has emerged as having the second-largest base of these users in the world after South Africa.

Opera Software commissioned a survey in India and found that almost half (49%) of people using mobile Internet either never, or infrequently, used a desktop computer to log on.

According to the company, which owns the popular mobile browser Opera Mobile, the total number of page-views on that browser in India jumped 232% in the last 12 months.

For 41% of Indians the mobile phone is the only possible way they can surf the web and is a cheaper option that purchasing a desktop computer.

As well as the convenience of using mobile to access the Internet, it is a cheaper option for most Indians with local operators offering affordable unlimited or 2-3GB mobile Internet access, even for those on the lower end of the wage scale in the country.

Opera's survey shows that men dominate mobile Internet use in India - 95.2% versus just 5% of females. This could be explained by a lack of enthusiasm for technology among Indian women as highlighted in a survey conducted by UMR Research. 

Google, Yahoo battle in India

NEW DELHI: Competition is intensifying between Google and Yahoo in India, as the firms balance the need to develop the nation's web advertising market with boosting their own revenues.

The Indian online ad sector experienced growth of more than 25%, to 993 crore rupees ($222m; €155m; £136m), in 2010/11 on an annual basis, incorporating a 28% lift for display, attaining 534 crore rupees.

Moreover, the country's internet population on PCs, laptops and other such devices has reached 80m, plus an additional 30m surfing via mobile phones.

Shailesh Rao, managing director of Google's media business in Asia Pacific, suggested a sea change had occurred during last year's Indian Premier League cricket tournament, when YouTube secured 55m hits.

"There is a difference between knowing about an opportunity and actually seeing it happen," he told the Business Standard.

"In a span of 30 days, we received sponsorship from seven to eight companies across multiple verticals in India who never thought of investing seriously on display ad. That's when we realised the magnitude of interest."

YouTube now boasts 20m unique visitors in India, and Google's search engine has achieved an 80% penetration rate among the web-connected community.

India's broadband growth slows to 6.5% in December quarter

Even as the government prepares an ambitious broadband program, Internet penetration in India is slowing down, according to TRAI numbers.

Rate of growth of Internet connections (including slow connections) fell to just 4.4% during the December quarter, or 23% compared to the last three months of 2009.

According to the latest data, India – which has 200 million households, had just 18.69 million Internet connections at the end of 2010. Out of these, only around 11 million were on fast connections or broadband – giving a broadband penetration rate of less than 1%.

In comparison, South Korea has a broadband penetration level of 95%, Sweden has 76% and Japan has a rate of 75% penetration.

India was supposed to achieve a 2% penetration rate – 20 million broadband connections – by 2010, but missed it by a mile.

The growth rate of both Internet connections and broadband connections have declined over the last several quarters. It went from around 12% quarter-on-quarter in the March quarter to 6.5% in December quarter of 2010.

The only silver lining to the cloud was that the proportion of faster connections – higher than 256 Kbps – is on the rise with every quarter.

It increased from 57.6% in September 2010 to 58.8% by end of December 2010.

Broadband penetration is likely to undergo a sea-change in the coming months as companies start rolling out wireless broadband networks based on Wimax and LTE technologies.

BSNL has already rolled out the Wimax network in many states like Kerala, but is yet to start roll out in most places such as Northern and Eastern India.

As of now, 86.29% (about 9 million plus) of the broadband subscribers are using copper wires. However, copper connections in India have been steadily declining – going from around 40 million a few years ago to 35 million at present.

Making of Snapdeal.com

Kunal Bahl and Rohit Bansal saw the growing number of people online, their large amounts of disposable income, the willingness of the retailer to use internet for sales and marketing. And their gut instinct told them, if they leveraged these, they could hit a jackpot. Thus was born Snapdeal.com.

Snapdeal.com features one attractive deal daily, with discounts of up to 90% on dining, health and beauty, recreation, entertainment, travel, sports and more. The site, which has 4 million subscribers, with a new subscriber signing up every second, was recently ranked the 21st most trafficked site in Asia by web usage tracking firm Alexa.

On April 25, Snapdeal.com sold 30,000 deals on a single day, one of the highest transactions on any e-commerce site in India. That day, it sold pre-paid recharge coupons of Rs 100 for half the price for leading telecom service providers like Aircel, Vodafone, Tata Indicom, Idea and Virgin. At one point in the day, almost 100 deals were being sold per minute. 

Flipkart Vs Infibeam: Who Gets The Traffic

These two Indian startups have a lot in common except for that Flipkart is VC-funded to the tune of anywhere between $10-15 million while Infibeam is backed by the founder’s money. Both were established in 2007 as online book retailers and have been scaling up at a consistently fast pace to become the top e-commerce sites in India today. According to this interesting graph on Google Trends which depicts the traffic statistics of the two Internet companies, both companies are fighting neck to neck on the traffic front.

The graph shows the daily unique visitors to both the websites across a period of around 2.5 years. According to the graph, Flipkart experienced a leap in traffic in the beginning of 2009 but fell in June to meet Infibeam‘s slow and steadily rising traffic. The traffic growth lines of the two companies entwines between June 2009 and March 2010 and separates as Flipkart’s line falls into a trough, although it recovers around mid-June 2010. Not to be left behind, Infibeam has also been experiencing higher traffic, and now both the sites are almost at the same level.

Remember, we are only talking about Internet traffic. After the recent flurry of TV ads by Flipkart, the company may have managed to increase its brand awareness among general masses and that may be yet to translate into Internet traffic.

Ad war in cyberspace

Yahoo remains the leader in digital advertising, but Google is catching up fast

The race for leadership in the digital advertising space is getting fiercer. While Yahoo is still the leader in the display space, Google has stepped on the gas.

The first evidence of Google’s resolve came when the Mountain View-headquartered firm gave out its revenue break-up – something it has never done before. Google said that the contribution from ads — from DoubleClick, Adsense and YouTube – was $2.5 billion. The intention was clear: Google wants to let the world know that it has achieved a critical mass in advertising.

Closer home, the appointment of Shailesh Rao as managing director of the media business for the Asia Pacific region was another indication of Google’s game plan. Add to this the recent launch of its campaign ‘Watch this space’.

The reason for the search giant’s enthusiasm is obvious. The Indian online advertising market went up by around 26 per cent to Rs 993 crore in 2010-2011 compared to the previous year. Total online display advertising market grew 28 per cent to Rs 534 crore.

More importantly, India’s internet user base has touched 80 million, and another 30 million access internet through mobile handsets. The latter is expected to grow as 3G starts gaining acceptance.

With YouTube, Google has demonstrated that it finally has the vehicle to dream big. To drive home the point, Rao says YouTube, which had 55 million hits during last year’s IPL, scored heavily on ad revenues. “There is a difference between knowing about an opportunity and actually seeing it happen. In a span of 30 days, we received sponsorship from seven to eight companies across multiple verticals in India who never thought of investing seriously on display ad. That’s when we realised the magnitude of interest,” explains Rao.

There’s more. Over 36 hours of video is uploaded on YouTube every minute. YouTube has crossed 20 million unique users in India and Google reaches 80 per cent of all internet users in India.

Rao says Google is focused on audience-based buying and targeting display advertisement. “We believe web is much more than just finding the audience and selling. We are trying to help through data that helps advertisers and publishers find the audience based on gender, interest, demographic, behaviour etc.,” he adds. And there are innovations galore. For example, offerings like ‘remarketing’ that allow advertisers and publishers to track a user anywhere.

THE LEADER’S MOVES 

Yahoo doesn’t seem to be overtly concerned about Google’s sudden aggression and says it is focused on growing the digital advertising category further by educating advertisers about the potential. Yahoo launched Fresh Fridays program for advertisers and agencies this year. This is a single day session that usually covers all key marketing and advertising professionals. “We share with them some great case studies, trends etc while encouraging them to leverage this medium to build their brands,” says Arun Tadanki, MD, Yahoo! India.

Digital ad campaigns for Dove, Samsung, Pepsi, Tata DoCoMo, Yatra, Cadburys and Citibank on Yahoo have delivered good results for brands. The Samsung Jet campaign reached out to over three million unique users in just seven hours with very high engagement. Tata DoCoMo reached nine million unique users through Yahoo.

Tadanki says Yahoo is constantly striving to retain its edge. It has already launched a dozen odd ad formats in the display advertising space. For example, its new log-in page ad enables advertisers to bring about their messages as they would with a full-page print ad but with much larger scale, reach and interactivity. “You can show a consumer an ad that lets him play the trailer of a movie (in full screen), post that link to Facebook; read reviews for that movie or even book a ticket for it: all from the ad itself,” informs Tadanki.

While the two giants are slugging it out, experts say that the larger story is to get the bigger chunk of TV advertisement spend. “I think Google is better prepared to garner this share of advertisement,” says Mahesh Murthy, founder Pinstrom — a digital marketing firm.

Data show Google is clearly gaining an edge. According to Comscore, in January 2011, Google sites ranked the top online video viewing destination in India across several metrics. More than 23.5 million viewers watched a total of 785 million videos on Google sites, with viewers averaging 1.7 viewing hours during the month.

But everyone agrees there is enough space for both to co-exist in India. Listen to Rao: the percentage of smartphones in India that allows rich media is still small in number. “But based on our interaction in the market, we will see in four-five years an Android-based smartphone with a price tag of just Rs 5,000.

The battle is therefore expected to be a long-drawn one.

India to have 24 million rural internet users by December 2011: Study

According to a research jointly conducted by Internet and Mobile Association of India (IAMAI) and IMRB, the total number of active internet users in rural India is projected to rise by 98 per cent and touch 24 million by December 2011 as compared to 12.1 million in December 2010. Claimed internet user category is also set to grow by 96 per cent to reach 29.9 million by December 2011 from 15.2 million in December 2010. The results are based upon a primary research survey that interviewed about 15,000 people from various age groups, across SECs and genders from the states of Assam, Maharashtra, Orissa, Tamil Nadu, Andhra Pradesh, Rajasthan and Uttar Pradesh. 

“One of the main reasons for this growth in user numbers in rural areas is the growing awareness level about internet. According to the research, about 69 per cent of the rural population is aware of internet as opposed to 16 per cent projected in last year’s report. The second reason for the growth of rural internet users is that access has become easier. Only 18 per cent have had to access internet from Common Service Centers (CSCs) located outside the 10 km radius as opposed to 54 per cent last year,” the research said. 

India to have 237 million internet users by 2015: Report

The number of internet users in India is expected to triple in the next five years, from the current 81 million to 237 million by 2015, according to a report by Boston Consulting Group. The report further states that many Indians will first go online from a phone, not from a computer, even though right now only 1 per cent of mobile phone users are using the internet.

India is going to be different than what we have seen in mature markets but also in emerging markets. It is going to be predominantly a mobile experience, Arvind Subramanian, managing director, BCG Mumbai and one of the authors of the report, has said. The traditional internet in its current form would be largely inaccessible even if it were to be available.

According to Arvind Subramanian, Indians are likely to take to services that enhance personal productivity, such as job alerts or continuing education. About 73 per cent of people who go online in India spend time job hunting, the research showed. The other thing that is big there is matrimonial which is a very unique Indian thing, Subramanian has added.

Indian SMBs set to spend $173mn on smartphones

With the world spending more on smartphones, Indian SMBs are as well. With 54 per cent of India medium businesses (MBs, companies with 100-999 employees) currently using these devices and a clutch of innovations on the horizon, smartphone penetration and spending are poised for growth.

In 2011, Indian SMBs (companies with less than 1000 employees) are set to grow that spending to $173 million, according to New York-based Access Markets International (AMI) Partners, Inc.

"At present many smartphone users in India do not use the data services that these phones offer," says Priti Verma, Research Analyst at AMI-Partners, Bangalore. "Insufficient data bandwidth is hindering usage of these services.

With the advent of 3G spectrum we are observing an increase in the coverage that phone companies are able to offer and in turn smartphone penetration levels and data plan usage are on the rise," continues Verma.

Smartphone vendors can improve demand for smartphones by continuing to reduce prices as well as offering more and varied plan options. "Users prefer using only one device for presentations, email or downloading information," adds Verma. "This eliminates the need to have multiple devices such as a projector, computer and a phone when conducting normal business and personal transactions."

The landscape of mobile internet usage has changed to such an extent that in some cases the first internet experience is now through a mobile phone rather than a PC. "Search, financial services, sports, online trading and entertainment get a big share of smartphone usage," says Verma, "and people spend more time on smartphone entertainment than talking or sending messages."

Currently India SMBs' installed base of smartphones is less than one million with the maximum penetration of these devices understandably in the professional services vertical.

Data show that Indian SMBs are planning an increased spending on smartphone data plan services. With many more companies recognising the advantages of using social networking , podcasting and micro-blogging, it seems natural that the adoption of the smartphone is on the rise throughout India.

As India continues to move towards a more mobile workforce, the smart phone will become an essential tool that all employees will require. With the improvement in the quality of navigation maps and simplification of licensing terms, phones with GPS capabilities are expected to become more in demand.

The emergence of open source operating systems and 2GHz processors will also help also boost smart phones. Looking forward, all of these changes together will forge a new paradigm of a true collaborative ecosystem 

India ranks third largest in internet market

New Delhi: In the year 2009 Forrester Research has predicted in its survey that India will have the third largest online population by 2013. India has just stepped in 2011 and has already been declared as the third largest internet market by Google. Besides it is also the fifth online video market worldwide. 

While delivering a significant presentation titled "You Ain't Seen Nothing Yet" on the first day of Ad:Tech New Delhi, the MD and Vice President, sales and operations of Google, Rajan Anandan revealed that, India has 100 million unique internet users spending 16 hours a week online. Google recorded 20 times growth in search queries coming from India over the last 5 years.

Out of the 100 million users, 40 million access from office and the rest 30 million access from cyber cafes and 30 million access internet from home.

In the technology sector, 72 out of 100 people make use of search queries. 30 percent of the entire air travel booking in India is done online. 54 percent travel searches are meant for hotels. 

He added that that more videos were uploaded in the last two months compared to the content produced by the largest TV network of U.S. in the last 72 years. 

Potential online video advertising market in India is estimated at Rs 600 million. Video streams originating from India is doubling year-on-year. There has been sudden shift of audience from TV towards online viewing of videos.

India's Growing Internet Market Benefits Rediff.com and Sify Technologies

NEW YORK, NY--(Marketwire - Apr 28, 2011) - As India's middle class expands, its internet market continues to grow at a rapid pace. Recent reports from the Internet and Mobile Association of India (IAMAI) says that internet awareness in the country is surging. According to IAMAI research, about 69 per cent of the rural population is aware of the internet as opposed to 16 per cent projected in last year's report.The Bedford Report examines the outlook for companies in India's Internet Sector and provides research reports on Rediff.com India Ltd. (NASDAQ: REDF) and Sify Technologies Limited (NASDAQ: SIFY). Access to the full company reports can be found at:

www.bedfordreport.com/2011-04-REDF

www.bedfordreport.com/2011-04-SIFY

IAMAI estimates that the total number of active internet users in rural areas is projected to rise by 98 percent this year, from 12.1 million in December 2010 to 24 million by December 2011. The report argues one of the drivers of growth in rural internet users is that access has become easier. The report says that cyber cafes continue to be a key access point for the use of internet.

Government initiatives have been conducted to facilitate internet networks and 'common service centers' both of which increased in 2010.

The Bedford Report releases regular market updates on India's Internet Industry so investors can stay ahead of the crowd and make the best investment decisions to maximize their returns. Take a few minutes to register with us free at www.bedfordreport.com and get exclusive access to our numerous analyst reports and industry newsletters.

Sify Technologies operates more than 1500 ePort internet cafes that open up the web to many Indian citizens. Sify provides internet and extranet services, website hosting, search engine optimization and security solutions. Last month the company announced their partnership with SAUDI TELECOM (STC), the largest telecom services provider in the Middle East and North Africa. Abhijit Barua, Sr. Vice President of Sify Technologies explains that Sify's role will be to "provide expertise in innovative managed services including cloud services and SaaS offerings in the Middle East and African markets."

Rediff.com India is one of the country's largest web portals. The company's websites consist of a range of community features consisting of e-mail, chat, video sharing capabilities, e-commerce, blogs, broadband wireless content, and mobile value-added services. Earlier this month shares of the company surged after the company rolled out its own group deals program. Rediff's "Deal Ho Jaye!" will offer consumers deals on local services including spas, tattoos, hobby classes, hotels, health care and restaurants at 30 percent to 60 percent off. The deals will be available for 40 Indian cities.

The Bedford Report provides Analyst Research focused on equities that offer growth opportunities, value, and strong potential return. We strive to provide the most up-to-date market activities. We constantly create research reports and newsletters for our members. The Bedford Report has not been compensated by any of the above-mentioned publicly traded companies. The Bedford Report is compensated by other third party organizations for advertising services. We act as an independent research portal and are aware that all investment entails inherent risks. Please view the full disclaimer at http://www.bedfordreport.com/disclaimer

Social networking site Facebook users cross 25 million mark in India

NEW DELHI: The number of Facebook users in India has crossed the 25-million base mark, the social networking site said Thursday.

"Facebook currently has 25 million users in India," said David Fischer, vice president advertising and global operations, Facebook at an interactive advertising and digital marketing exibition, Ad-tech here.

Facebook has almost become the most popular for active interent users in the recent past in India, leaving behind other social networking sites such as Orkut and Twitter .

"We are also looking forward to building strong relationship with India's strong network of developers and entrepreneurs who are increasingly harnessing Facebook to create unique sharing experiences on the social web," said the company.

The 25-million and growing Facebook users in India range from business people and students to public figures and institutions, including Finance Minister Pranab Mukherjee, the Delhi Traffic Police and bollywood perfectionist Aamir Khan.

From January, Municipal Corporation of Delhi has also started using Facebook for users to post problems for immediate action on areas like sanitation and garbage cleaning.

India has over 100 million users. Though the figure is hardly 10 percent of the total Indian population of 1.21 billion, it still puts India at the number three position in the world largest internet users list.         

Rural Internet users to rise by 98 pc by Dec: IAMAI-IMRB study

A report released by the IAMAI suggests that the use of Internet in rural India is set to rise by 98 per cent to touch 24 million in December 2011. The same report also showed that between June 2010 and December 2010, the number of claimed users had already grown by 40 per cent, and that the active users hover at around 80 per cent of the audience.

The research by the IAMAI and the IMRB found three reasons for this growth. There is a growing awareness of the internet in rural areas today, and access has also become far easier than before, with entertainment driving the adoption of internet in rural areas