Internet users in India to reach 627 million by end of this year

Mumbai: India's internet users expected to register double digit growth to reach 627 million in 2019, driven by rapid internet growth in rural areas, market research agency Kantar IMRB Wednesday said. Internet usage in the country has exceeded half a billion people for first time, pegged at 566 million, driven by rural internet growth and usage.

In its ICUBE 2018 report that tracks digital adoption and usage trends in India, it noted that the number of internet users in India has registered an annual growth of 18 percent and is estimated at 566 million as of December 2018, a 40 percent overall internet penetration, it observed.

It projected a double digit growth for 2019 and estimates that the number of internet users will reach 627 million by the end of this year.

Of the total user base, 87 percent or 493 million Indians, are defined as regular users, having accessed internet in last 30 days. Nearly 293 million active internet users reside in urban India, while there are 200 million active users in rural India, it said.

The report found that 97 percent of users use mobile phone as one of the devices to access internet. While internet users grew by 7 percent in urban India, reaching 315 million users in 2018, digital adoption is now being propelled by rural India, registering a 35 percent growth in internet users over the past year.

It is now estimated that there are 251 million internet users in rural India, and this is expected to reach 290 million by the end of 2019, the report said.

"Increased availability of bandwidth, cheap data plans and increased awareness driven by government programmes seem to have rapidly bridged the digital gap between urban and rural India. Consequently, the penetration in rural India has increased from 9 per cent in 2015 to 25 percent in 2018," it added.

Bihar registered the highest growth in internet users across both urban and rural areas, registering a growth of 35 percent over last year.

The report also noted that the internet usage is more gender balanced than ever before with women comprising 42 percent of total internet users.

"It is fascinating to note that the digital revolution is now sweeping small towns and villages perhaps driven by increased accessibility at affordable data costs. The increase in the usage of digital in rural India, where more than two-thirds of active internet users are now accessing the internet daily to meet their entertainment and communication needs," KantarIMRB managing director Media and Digital Hemant Mehta said.

Marketers have a big opportunity today where they can use digital to reach their consumers both in urban and rural India, Mehta said.

Meanwhile, Akatsuki Entertainment Technology Fund (AET Fund) Wednesday said it will invest in startups in the US and India that are engaged in areas like content, media and entertainment. With more than 10 deals in the pipeline, AET Fund is looking at investing in another five to six startups before the end of the year, a statement said.

"The fund will support and nurture heart driven business ideas at the cusp of entertainment and technology. With an initial corpus of USD 50 million aimed at investing in India and the US, the fund aims to create distinctive values in content, media and entertainment space," it added.

The corpus will be used for seed to series A funding in the selected startups. In the US, AET's investment portfolio includes entities like professional esports team - Faze Clan, in-game video chat - Bunch, and live streaming entertainment - Ripkord.

"The fund aspires to leverage its global experience and expertise on its India journey, and scale up as it gains local insights.

"To begin with, AET will work with Indian startups operating in areas including video content, vertical media, vertical e-commerce, esports, mobile game, vernacular content and content IP business," the statement said.

Tomoya Ogawa, Managing Director at AET, said the company is excited about working in a market as diverse and dynamic in India.

"India has a very important role to play in the next leap of content creation and consumption and we're excited to work with innovative startups enabling that.

"We hope to bring our learnings and best practices from disruptive ideas and platforms across Japan and the US and create a symbiotic relationship with the flourishing startup ecosystem here," he added.

Meanwhile, some stakeholders from the online trading sectors are seeking more time beyond March 9 to provide their comments and suggestions on the draft national e-commerce policy, an official said.

The government has released the draft proposing setting up a legal and technological framework for restrictions on cross-border data flow and also laid out conditions for businesses regarding collection or processing of sensitive data locally and storing it abroad.

The draft was formulated by the Department for Promotion of Industry and Internal Trade (DPIIT). It seeks to provide for consideration and discussion, a policy framework that will enable the country to benefit from rapid digitisation of the domestic, as well as global economy.

"Certain e-commerce players have sought more time from the department to give their views. It is under consideration. Currently the last date for receiving comments is March 9," the official added.

The 41-page draft addresses six broad issues of the e-commerce ecosystem -- data, infrastructure development, e-commerce marketplaces, regulatory issues, stimulating domestic digital economy and export promotion through e-commerce.