India's Internet Growth Fuels Net-Based Businesses

By Anjana Pasricha from New Delhi

©flickr.com/John.Karakatsanis

   

The number of Internet users in India has topped 100 million, fueling the growth of net-based businesses.

When Deepinder Goyal was working at a consulting firm three years ago, he found his colleagues kept a stack of menu cards handy so that they could order lunch from different restaurants. That gave Goyal the idea of launching a net-based food and lifestyle guide.

“We scanned these menu cards and put them online," Goyal said. "So starting an Internet venture was actually an experiment and it worked out really well and currently we are getting around two million people just looking up menu cards on our website every month.”

Goyal’s website, Zomato.com, has flourished partly due to an explosion in the food and restaurant business, and partly due to the huge growth in the number of Internet users in India in recent years.

India now has over 112 million users - about 10 percent of the country. It is the world’s third largest user base behind China and the United States. With about five million new users logging on every month, the number is expected to reach 250 million in less than two years.

Subho Roy, head of the Internet and Mobile Users Association of India, says a recent survey indicates Internet usage, initially largely restricted to big cities, is now making rapid inroads into smaller towns and cities.

Roy also says many more people are logging on from home and slowly ending the domination of cyber cafes, which were used by people who did not own computers or have access to the net. 

“Last year the old pattern was still there, cyber cafes being top, then office, and then home. So this dramatic change has come about this year," Roy said. "There is a very, very great movement in the home use segment. People are probably buying their own broadband connections and accessing it from their own devices rather than going to common service points.”

Goyal says that is helping businesses like Zomato.com.

“Earlier we used to see that around 50 to 60 percent of our traffic used to spike at lunches on weekdays. That was due to corporates [company employees] accessing our website when they used to order lunch. Right now, weekends are also very heavy traffic for us,” Goyal said.

Many others are benefiting. Online shopping, for example, is on the rise. Young people who started by booking movie tickets and air tickets online are ordering mobile phones, laptops, books, and accessories such as watches on the net. An industry survey indicates the online retail business is growing by 35 percent annually and will reach nearly $1.5 billion by 2015. Nearly half the customers come from smaller towns where wealth and aspirations are growing.  

Facebook said this week it expects India will top the number of users in the coming years. Currently, there are 30 million users of the popular social networking site in the country.

The number of people in India who own computers remains limited. But nearly half the country’s population now has mobile phones, and many of the country’s new users are expected to access the net from these devices. ---VOA News