India Digital Summit: Participants call for higher internet penetration
Taslima Khan January 16, 2015
Top industry leaders and government officials on Friday called for increasing Internet use among the masses as they discussed emerging trends in a range of services from online ticket booking to e-governance.
At the ninth India Digital Summit hosted by the Internet and Mobile Association of India (IAMAI) in New Delhi, the participants also deliberated on the reasons for average Internet consumption in India staying way below that of advanced economies such as the US and the UK.
Aruna Sundararajan, Chairperson and Managing Director, Bharat Broadband Network, and also Additional Secretary in the Ministry of Communications and IT, said the government was working towards improving Internet access through the National Optic Fibre Network (NOFN) project. By March 2015, Kerala will be the first state to benefit from it. Fifty-thousand gram panchayats will be Internet-connected by the end of 2015, which will add 200 million Internet users. Sundararajan said the government had set up a committee to monitor progress on the digital front. "The ability of the panchayats in terms of laying down fibres has been a major constraint towards optic fibre layout," she said, adding: "Industry participation will be critical for broadband penetration."
Another reason for low Internet consumption in the country is the paucity of content in local languages. Rajan Anandan, Managing Director at Google India, said: "Enabling content consumption in local Indian languages can greatly push the Internet consumption up." While online entertainment and educational services and e-commerce have a big growth potential in rural areas, online services like eHealth and e-governance will be the next big online services.
There was a panel discussion on the rise of mobile wallets in the country, which highlighted how wallets can spur e-commerce and the payments infrastructure. Mobile wallets can play a crucial role in enabling digital transactions because over 60 per cent of the population was still unbanked and dealing with cash. There are four major use cases of wallets: payments of regular bills like mobile recharge, postpaid bills, making e-commerce payments as also for making peer to peer payments.
Wallet companies are trying out different models to increase adoption for e-commerce payments. "We are running a pilot with a marketplace wherein customers can walk into our Oxigen physical stores, browse through the product catalogue of the marketplace and make a payment through the mobile wallet," said Udit Sharma, Vice President, Oxigen Wallet, Oxigen Services India. Payments through wallets can help overcome the friction and inefficiencies of payment modes like cash-on-delivery. "Consumers can overcome the trust factor in online payments," said Bipin Preet Singh, Founder and CEO, MobiKwik.
However, there are challenges ahead in adoption of digital wallets which operate with a license from Reserve Bank of India. Converting cash into digital money is the biggest challenge towards adoption of mobile wallets. It should be as simple as handling cash, especially for consumers. The adoption of wallets also needs to be incentivised initially and as there are a number of wallet companies, there should be common operating standards for everyone.
There are still a lot of gaps in the wallet ecosystem as it exits currently. For instance, consumers should be able to pay for purchases like coffee or for grocery purchases at offline stores as well. This can be done only by expanding the merchant base that accepts wallets as a mode of payment. Wallet companies are left with the challenge of how payments through wallets are better than in cash. "One of the ways wallet payments are better is that they can help establish a relationship between a merchant and a customer, something cash transactions cant," said Oxigen's Sharma
A brainstorming session on online travel, which constitutes the biggest chunk of e-commerce in the country, brought to light the changing trends. As per a report Mobile Internet in India 2014 released by IAMAI and IMRB International launched at the event, the number of mobile Internet users in India is expected to reach 213 million by June 2015. There were 173 million mobile Internet users in India in December, 2014, as per the report.
Online travel is seeing a big change in terms of changing consumers moving from desktops to mobile sites and apps. "While the growth in desktop is almost zero, it's terrific on mobile," said Aloke Bajpai, Co-founder and CEO of meta search site ixigo.com. "It is not only mobile first anymore but mobile only soon. Will have to see whether to work any further on evolving our desktop experience."
Travel-related content is going to play a very important role to facilitate transactions. Lot of consumer engagement for online travel companies like Yatra and MakeMyTrip is coming through content like photos and videos. Even on the hotels side, hoteliers are increasingly taking consumer reviews and managing their online reputation seriously. Sharing services like that of AirBnB will be built only on strong content and reviews.
Dhruv Shringi, CEO of Yatra.com, said: "The next thing to aim for travel companies is personalisation of travel purchases such as hotels and holiday packages as also using predictive computing to understand and predict consumer behaviour and reacting to it."
Start-ups have already latched on to opportunities in providing travel content and trip planning services. There is also a big gap in terms of bringing local content like, say, a camel ride in Rajasthan or booking a theatre in Mumbai online. In India, a much as 85 per cent of local travel content is still to come online. "In the course of the next 12 months, you will see products like marketplace for travel activities and travel experiences being built," said Shringi of Yatra.