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State of the Internet in India (Part 2)

June 30th, 2009 · 42 Comments

There are three obvious and two not-so-obvious things which need to be done to get the Internet business growing again. The obvious ones:

  • Reasonable, flat-priced (unlimited use) broadband needs to grow. I think the pricing sweet spot is somewhere around Rs 250 for unlimited use for 512 Kbps-1 Mbps connectivity. Actually, the last-mile conenctivity quality is not that much of an issue — in most cases, the pricing is. Metering Internet usage isn’t a way to explode this ecosystem.
  • Computing and Internet need to get more associated with education and entertainment. This is where families who haven’t yet done so will start getting them at homes. Services don’t necessarily need to be provided for free — ISPs can bill for “value added services” as part of the bill, and revenues can be shared with the content providers. This ensures that content providers can get subscription revenue and not be dependent only on advertising, and ISPs can get additional upside than just the flat-rate data charges.
  • Investments need to start flowing again in this space — the $500K-$2 million kind, which lets companies get started, and have enough runway for 18-24 months to show the business either works (in which case they will be profitable), or it doesn’t (in which case they fold up). A hundred companies need to flower so that we get a few to succeed, and become big.

Much of this is quite obvious to people in the space. I will add two more not-so-obvious point to this mix tomorrow.

Tags: Uncategorized

42 responses so far ↓

  • 1 Rohitaash // Jun 30, 2009 at 9:03 am

    I believe the fact that indian state governments have left no stone unturned to squeeze and stifle the cyber cafes to a point of negative growth in numbers. So the STD PCO factor in promoting internet didnt happen to the extent it was possible.

    Add to that the fat that there are no national players like Airtel and Reliance, IDea etc with big money to promote the field at a similar levels to that of cellphones.

    Plus there ia a total lack of self serving culture. Even coffee and soda bottle machines are manned in India. For any website without a major buzz, people are not satisfied till they have talked to a human and made sure someone is going to be responsible if things go wrong.

    Thanks
    Rohitaash

  • 2 Akshar // Jun 30, 2009 at 9:31 am

    ” s 250 for unlimited use for 512 Kbps-1 Mbps”.. thats a dream.
    At least in Goa except BSNL there is no one providing Rs250 plan broadband, even in case of unlimited plans it is priced at 750.
    QoS is an aspect we better not even expect right now 🙂

    Longer we take to provide this, everything will get delayed…

  • 3 FirstBallSix // Jun 30, 2009 at 8:02 pm

    A New Device. Thats What India Needs.

    MUST be a cellphone plus net device. Like a poor man’s iPhone for example. Bring it to 7500 Rupees price point: Internet Boom In India Will Officially Begin.

  • 4 BizDharma // Jun 30, 2009 at 8:32 pm

    There needs to be commoditization (if I can call that) of broadband. The way Reliance came up with 500 Rs mobile phone. This needs a lot of Government initiative to increase broadband penetration in India.

    Another clear issue is the Customer service or experience that we have here in India. With major brands like MTNL under the govt purview, this simply adds fuel to the fire.

  • 5 Amit Chakradeo // Jul 1, 2009 at 1:05 am

    Came across an interesting post about the topic here : http://gramvaani.org/2009/06/robust-low-cost-internet-service-for-rural-areas/

    The idea is not to aim for interactive broadband, but creating innovative delay-tolerant applications using non-conventional methods for data transmission (Travelling routers with hard disks, USB disks etc). Haven’t had much time thinking about implications, but thought it will of interest here!

    –Amit

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