The growth story of mobile internet in India is on the upsurge. According to the IAMAI & KPMG Report “India On The Go – Mobile Internet Vision 2017”, India is projected to have 236 million mobile internet users by 2016. The Report further projects that mobile internet user in India will reach 314 million by 2017.
The Report also points out that India will have over 500 million internet users by 2017. As of June 2015, internet users in India stood at over 350 million. According to the Report, 2G user base in India is projected to decline in the coming years as more and more customers are expected to migrate from 2G to 3G. The 3G user base in India is rapidly gaining market and is projected to grow at a CAGR of 61.3% from 2013-17. There were approximately 82 million 3G subscribers in India by the end of year 2014 and the number is projected to reach 284 million by end of year 2017.
Commenting on the release of the IAMAI-KPMG report, Ashvin Vellody, Partner – Management Consulting, KPMG in India said, “With more than 300 million internet users, India has the second largest internet user base in the world. But the internet penetration at 19 per cent (approx) is poor and limits the potential. The next wave of growth in penetration of internet will driven by adoption of mobile internet. The mobile internet growth story would be written by the large population in the hinterland and meaningful and compelling content/ use cases would enable adoption of mobile internet.” He further stated, “It is imperative to connect Indians through internet of which the mobile internet will play a key role since reliable accessibility will be the killer app that will bind the internet ecosystem together, increase adoption and enable innovation in business models around voice and data services.”
Speaking at the launch, Dr. Subho Ray – President IAMAI reiterated that growth in the internet space will come from the non-metro and rural areas. He said, “While the urban market has not reached its saturation point, it will be non - metros and rural India that will be driving internet growth in India. And this is where mobile internet will be playing a pivotal role. The advent of low cost smartphones coupled with low mobile tariffs has empowered consumers in the hinterland to use data connectivity and we will seeing more usage of internet from these areas in the months to come.”
As per the Report, rural India is steadily moving towards a more Internet friendly and exploratory mind-set. As of 2014, the Active Internet User (AIU) base in rural India was 6.7% of the overall rural population of 905 million and accounted for 61 million users. 4.4% of the total rural population used a mobile device to access the Internet; a figure that stood at a meagre 0.4% in the year 2012.
The Report has found that the rural growth story in the coming years will likely be written by 2G technologies. 3G and 4G may continue to be primarily an urban phenomenon for the next few years. Increased Internet enabled device penetration, decreasing handset prices and data plans tariffs are helping to create a suitable environment for a rapid growth of Mobile Internet in India, with rural India set to take the lead. As of June 2014, nearly 50% of the AIU in rural areas accessed Internet using mobile phones, Community Service Centers (CSC) and Cyber Cafes. 38% of the Active Internet Users use Mobile phone as the main access point.