NET.COLUMNS: The State of the Indian Internet

As the year ends, we look back at 1997 and ahead to 1998. (Part III
of the IndiaWorld Story will be carried next week).

1997 was the second full year of commercial Internet access in
India. The accounts grew to about 50,000 with 200 leased line
customers. This was the year Indian companies started setting up
websites in full gusto. Cybercafes sprouted up in many cities.
Tariffs for TCP/IP access have come down (starting Jan 1, it will be
as low as Rs 20 per hour). A whole variety of info-oriented websites
have been setup. Early adopters have set up Intranets, with some
Extranets (like NFDC). We have two magazines dedicated to the Indian
Internet (Web Vision and Biznet). Almost all the publishers got on to
the Net bandwagon. All in all, a year of reasonable progress.

The privatisation of the Indian Internet seems as distant as it did a
few months ago. The latest spanner comes from the Elections. It seems
unlikely that the guidelines will be announced by mid-Jan, and
indications are that the delay could be as much as 3-4 months. But,
what is clear is that by early 1998, there will be at least 3 ISPs:
VSNL, DoT and MTNL. While VSNL will continue to offer its services in
the major cities, DoT is likely to extend its reach into the
second-tier cities and MTNL will concentrate on Mumbai and Delhi.
With many companies waiting in the wings to come ISPs, 1998 will be
the year of significant Internet growth in India.

Companies are just starting to look at building Web-based
applications. This trend will accelerate during 1998. The next year
will also see the first forays into electronic commerce. ICICI Bank
has launched its Internet Banking service recently, and other banks
are likely to follow. Expect merchants to start selling, and
electronic payment mechanisms to be available.

For many websites, I expect 1998 to be the year when domestic traffic
exceeds international traffic. This is very important, since without a
reasonable local audience, Indian websites cannot survive financially.
Once you have a hundred thousand people accessing the Net regularly,
advertisers are bound to notice, and this will further speed up the
growth of the medium.

The defining moment of the Indian Internet in 1998 is likely to come
during the Indian elections: while TV will provide live coverage, I
expect the Internet to become an important alternate “channel”, and
one which people can customise. Try figuring out who is leading in
your constituency. Do you wait for TV to tell you in a few hours, or
do you hit the Net?

Published by

Rajesh Jain

An Entrepreneur based in Mumbai, India.