Google predicts Indian web explosion

With smartphones becoming cheaper and telecom carriers investing in high-speed wireless infrastructure, Google expects that by the number of people using the internet in India will have tripled by 2014.

Currently, according to Google India chief Rajan Anandan speaking with the Wall Street Journal, India has about 100-million web users, and in 2014, will have at least 300-million.

Those 100-million users, however, represents only eight percent of India’s 1.2-billion strong population. Despite this, India is still the world’s third-largest internet market (by users), after China and the United States.

Anandan, a former Microsoft India head who took over Google’s Indian operation noted some of the challenges India faces. “Despite a lot of the infrastructure challenges we have as a country, 100-million Indians are online,” he said.

“They’re spending a huge amount of time online and they’re doing a varied set of things online.”

With traditional media, television and newspapers, drawing the majority of advertising spend along increased regulation from government, how to capitalise on this large emerging audience will be a challenge.

Making money off that growing audience, though, is proving difficult thus far for Google and other Internet companies,” Anandan told the Journal.

Google doesn’t release figures regarding its earnings in India. Analysts believe, however, that it has laid claim to about half of the online ad market, a disappointing statistic relative to the search giant’s dominance in other parts of the globe. Anandan, however, said the internet giant was betting money would start flowing more quickly.

Although India has the world’s third largest user base, a very different picture of India’s web presence emerges when one looks a dollar spend.

Online ad spending in India is only about US$200-million per year, is a small fraction of the global ad-spend, thought to be worth around US$80-billion annually.

eCommerce platforms such movie and airline ticket sales generate about US$5-billion in revenue in India, a pittance when compared to the US$80-billion generated by the same platforms in China.

Anandan expects India’s next 200-million web users will be accessing the internet primarily using the high-speed wireless networks that carriers are in the process of rolling out countrywide.

Anadan had one last caveat though. For India to fulfill its explosive potential it was crucial that mobile handset makers bring out smartphones at prices which India’s masses can afford.