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Wednesday, 09 November 2011 00:00
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10% Indians use the Net, but we’re ranked 116 on ICT


A 100 million user base for Internet users, the head of the Internet and Mobile Association has been quoted as saying, is an important benchmark, a sort of threshold after which usage rises dramatically “with the possibility of the country becoming the largest Internet user in the world in this decade”. That's great news since a World Bank study for developing countries had estimated that a 10% rise in broadband penetration leads to a 1.3 percentage point hike in GDP. It’s important to keep in mind, though, that India still defines broadband as speeds of over 256 kbps while a 1 mbps speed is the more appropriate definition—of India’s 15 million Internet connections, less than a tenth are above 1 mbps. The problem gets compounded when you see the growth of Internet users—a 13% growth rate is good on a high base, but 87 million (last year’s number of users) is less than the number of new mobile phone users in a year. Hardly surprising then that while India celebrates 100 million Internet users (the US has 245 million and China 485 million), the most recent International Telecommunication Union’s ranking for India on the ICT Development Index (IDI) was 116th out of 165 countries—while India has done a great job on mobile phone penetration and will have more mobile phone users than China by January, mobile voice telephony account for just 8% of the IDI, the rest is broadband and Internet and network infrastructure.

The biggest bottleneck here, and the proposed new telecom policy does little about it, is that while BSNL has 28 million land line users who can easily be converted to broadband, the PSU has done little of this, nor does it allow others to access its network. The usual hope given out is that more Indians will access the Net on their mobiles, which is why 3G/BWA services attracted the kind of bids they did. Yet there are less than a million broadband mobile dongles and under 10 million 3G subscribers—the proportion who access broadband services on a regular basis will be even lower. If Akash clicks, as the government hopes it will, that would do a lot to raise usage, but a lot more is required. Costs are obviously too high—a R750 per month broadband plan is way too expensive for a country where the per capita income is R3,500 per month; on average, relative to their income levels, Indians pay around 4-6 times what people do in developed countries for their broadband. The fact that the content development business hasn’t really taken off—that will drive Internet traffic—may also have to do with the fact that telcos aren’t sharing enough of additional revenue with developers. Perhaps the very poor 3G takeoff will make them re-think this.


Last Updated ( Tuesday, 22 November 2011 08:48 )

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