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Take away India’s mobile miracle and you soon realize how much the country lags in terms of PC penetration and broadband adoption. According to recently released data from the Indian government, the total broadband subscriber base rose to 6.8 million in July from 6.62 million in […]

Take away India’s mobile miracle and you soon realize how much the country lags in terms of PC penetration and broadband adoption. According to recently released data from the Indian government, the total broadband subscriber base rose to 6.8 million in July from 6.62 million in June — up a whopping  2.7 percent. (The Indian government defines broadband as Internet connectivity of speeds at or higher than 256 kbps.)

That’s pathetic, as there are five major telecommunication companies in India: Bharti, Reliance, Tata and state-owned BSNL & MTNL. There’s no reason why there aren’t more broadband users in India — in particular, those big phone companies should be aggressively subsidizing the newer, more powerful sub-$500 netbooks that come with 10-inch screens.

While it could help boost Nokia’s revenues, more importantly, it could jumpstart the Indian Internet ecosystem, which is already vibrant even despite such low broadband and PC penetration. Take a look at this presentation from Trendspotting about the state of India online to see just how engaged the region’s Internet users are. There are about 54 million active Internet users in India, according to the report, who love to search on Google, watch a lot of video on YouTube and are completely smitten with Facebook (the number of Indian users has risen 156 percent in the past 12 months alone). And when it comes to Twitter users, the country figures among the Top 10 in the world.

  1. Indian market never really had the trend of device subsidies to entice people to subscribe to a service, and it doesn’t need that either. There is a thriving market in assembled cheap desktop computer in cities all over India. Device penetration is NOT the thing that’s holding back Indian broadband adaptation. It is the pathetic state of the broadband services being offered. The quality of the broadband connectivity and the customer service that goes along with it are both really pathetic in India.

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    1. Well that doesn’t mean it can’t or shouldn’t be done – subsideies I mean.

      I think as far as the service is concerned, well apparently you need to call Bharti twice a day to make sure your DSL works. That is one way to use up your mobile minutes. :-)

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      1. or in case of bsnl – three times a day… :)

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  2. Hi Om,
    Ur site s really nice , vry simple n vry imformative…… ur articles are superup
    where u get such an brillient ideas .

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  3. Om,

    I am one of the first users of Broadband in India. I know the penetration is not a lot in India, but let me tell you the figures not correct. A large chunk of broadband users in India are the people who work in the IT and ITES sectors. They use their office internet and generally do not subscribe to a broadband connection at home

    Regarding the big companies, if you compare with the mobile growth. The growth experienced between 2005-2009 is many magnitudes more than what happened between 1993 and 2005

    The reason is that Indian companies are used to skimming strategies. The mobile cost was Rs 16 per minute when it was first launched and now Indian mobile rates are the lowest in the world.

    The same case is going to happen in Broadband. Soon we are going to achieve critical mass and then providers will start dropping rates like crazy and the penetration will increase.

    We hope that time comes soon, till then we will have to do with sub standard services at premium rates

    Yup, you are right about Facebook, I feel it has become more popular than Orkut now, thats the kind of network effect benefits you can have in a country the size of India.

    The reason Twitter is so popular is that probably half of the social marketing experts in the world are based in India :-) and its more due to outsourcing than due to genuine Twitter usage

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    1. Abhi

      I have heard about broadband penetration going up for so many years. I met with TRAI about four or five years ago. I also met with Arun Shourie, then the telecom minister. I think nothin really has changed and to be honest, it won’t because the country’s political leaders are completely un-savvy about the potential of broadband.

      Start comparing to what is going on in China and you see the big picture. More PCs, more broadband = more new ideas and much bigger domestic market. I think this is where India needs to get its act together and be very very aggressive on broadband.

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      1. Every word of yours is true, but you know how the system works in India. Bharti is the best and largest Broadband provider in India, yet their services are much more expensive than a comparable service in US, while their mobile services are the cheapest in the world

        We are the leaders in smartphone and cloud based computing in India and we know the potential.

        Unfortunately we have to bide our time till the powers that be decide whats good and start implementing it in India

        For that to be , mobile providers will need to see a stagnation in Mobile revenues, and then start focusing on newer revenue streams like Broadband

        Its all about the network effect, takes time, but will eventually grow very very fast!

        We hope it happens by 2010-2011

        Its a big opportunity and I hope these people realize this sooner than later!

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  4. [...] actualise how such the land lags in cost of PC onset and … Here is the example post: Despite Their Numbers, Indians Are Active Online Posted in Uncategorized | Tags: and-, and-you, Google, government-began, italian, [...]

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  5. Seems like a chicken & egg problem. Lack of reliable &*scalable* infrastructure leads to poor QoS makes it difficult to reach critical mass which makes big telcos wonder about their returns on infrastructure investments.

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  6. yes it is true that 256 kpbs is the broadband but in reality in the name of broadband people do not even get this. It is basically “upto 256kpbs”….even the new wireless broadband devices from reliance and tata claim to be “upto 3.1 mbps” but I haven’t experienced that yet…claims are seldom true

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  7. Om, the real reason for poor broadband numbers may be corruption. There were hundreds of cable operators providing high speed last mile using ethernet. They were hounded out of business by requiring licensing, even for single homed connections. Till the hold of large telcos over the regulatory authorities is not broken, value addition and innovation in telecom will remain low in India.

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  8. bala murali krishna Tuesday, September 1, 2009

    Om, I would have to agree about this oft-told story of how it is all happening now. Tomorrow never comes as far as broadband goes, and the mobile miracle you talk about is way short of miracle when it comes to mobile broadband. I think too many Indians just don’t have any pressing need to go online, and it might be reasonable to accept that this will not change in the short term.

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  9. Looks like Airtel read Om’s comments. They are offering a Rs8000 Netpc with their broadband subscription.

    http://www.airtel.in/applications/genericlead/netpc/netpc.html?source=airtelin

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  10. Broadband penetration is too low for a country of India’s promise.

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