Internet and Mobile Market Trends

1. The overall number of Internet users is not showing a promising growth trend.
2. By our estimates the number of Internet users stands at around 42 million. This includes Internet access through mobiles also. Internet access through mobile is around 3% of the total mobile users in the country.
3. The overall mobile density is almost close to 100% in India. But the overall ARPU’s have been showing a steady decline since last couple of years. Lack of transparency in revenue sharing among various mobile stakeholders like MNOs, content aggregators and content creators is seriously affecting the health of the mobile value added services market in India.
4. Lack of interactive and value added content, lack of enough regional language based applications and real-life problem-solving and helping applications are the common reasons why Internet is not proliferating in India.
5. Lack of last mile broadband speed and severely lacking QoS among Public incumbents like BSNL and MTNL is seriously affecting the health of Telco’s networks and in turn the growth of Internet in the country.
6. The role of Internet based governance or e-governance shows promising examples although a lot is still to be achieved by various states in this area. States like Rajasthan and West Bengal are doing a good work on e-governance and digitizing and making public records available to general public.
7. The latest numbers for the overall rate of GDP growth as per CSO, Govt. of India is around 5.3%. Agriculture and manufacturing are showing signs of sluggish growth, fiscal deficit has increased and rupee is close to Rs. 51 to dollar as of today (while writing this piece as on 3rd of March 2009). 
8. The Government aided stimulus package is already helping to buck the trend but it’s not going to solve all the problems in a jiffy. The RBI has lowered the interest rates quite appreciably but it needs to do more than that. RBI needs to pump in more money into the economy as a whole. Rather than just giving the stimulus packages RBI should also get more currency printed and rolled into the economy as soon as possible.
9. US housing induced credit crisis has already led the US market into recession. Going by the latest budgetary allocations and provisions by the US especially the tax breaks in the outsourcing industry, the Indian outsourcing industry is not going to be affected right away in a major way. However small companies based out of US outsourcing work to India will play caution in near future.
10. Internet applications or channels like jobs, matrimony, and travel are the usual clinchers in India. The market for e-commerce in case of B2C will grow to touch Rs. 17255 crore at a CAGR of 51.27% by the end of the year 2009.
11. B2B E-commerce Market Size (in terms of transaction volume) as on year-end 2008 was around $77,963,559,419.B2B E-commerce market has been increasing at a rapid pace and is expected to touch: US $89,090,947,646 by December 2009, at a CAGR of 8.77%.
12. ICT Sector Expenditure in India (% of GDP) for the year end 2007) was around 7.8%, this is equivalent to about Rs. 54,458,128,072 crore.