The National Readership Survey (NRS), released recently by the National Readership Studies Council (NRSC), validated what most analysts had been predicting for a long time - that the reach of the Internet in the country has crossed the 6-million mark.
What's even more interesting is the backdrop against which this growth has happened. According to the study, an estimated 1.4 million adults accessed the net in 1999, which increased to 1.96 million in 2000, jumping to a whopping 4.11 million in 2001, finally touching 6.02 million in 2002.
The key drivers of this growth have been the urban population based in the eight metros of the country (which stood at 0.9 million in 1999 and grew to 2.9 million in 2002), followed by towns with a 10 lakh-plus and a 5-10-lakh population (corresponding figures would read as: 0.18 million in 1999 to 0.8 million in 2002 and 0.07 million in 1999 to 0.5 million in 2002). In towns with less than 5 lakh population, the reach of the Internet is in the region of 1.7 million as against a figure of 0.26 million in 1999.
So what have been the crucial factors behind this growth? Explains Katy Merchant, senior vice-president and country manager, IMRB (one of the research agencies participating in the NRS), "One of the primary reasons for this growth has been the relatively liberal policy the Government has had towards this medium, growth of service providers such as VSNL and MTNL, a rash of IPOs that led to correction in the pricing, boosted by VSNL cutting down on subscription rates. All of these have gone a long way in allowing the common citizen easy access to the net."
Merchant also points out that this has come along with the penetration of the PC. The growth in PCs was encouraged by lower custom duties, the Indian ability to clone the best of brands and create the 'assembled' PC market, which became such a threat in the metros and mini-metros that the organised sector had to 'Indianise' their offerings at a price acceptable to the market. This improved the computer to staff ratio in offices, besides helping the PC to penetrate educational institutes, households and the commercial sector. "The simultaneous expansion of telephone lines with the upgradation to digital exchanges has been a long awaited process, which fructified JIT (just-in-time)," Merchant adds.
While, on the face of it, the figures look attractive, some in the net community seem skeptical. Says Sundeep Nagpal, managing director, Stratagem Media, "Six million doesn't sound terrific to me. This kind of growth was expected from the medium. Let me tell you that growth in percent terms may sound phenomenal but in absolute terms it may not be so great after all."
And there are hard facts to support his statement. Online marketing solutions company, Mediaturf Worldwide maintains that the reach of the Internet in the country is way beyond NRS figures. Says V Ramani, chief executive officer, Mediaturf Worldwide, "By virtue of serving two billion ad exposures in the last 21 months and 800 million in the last six months, I can tell you that Internet reach is 10,136,361 in absolute terms." Mediaturf arrived at this figure by multiplying the number of PCs on its network - 2,896,103 and the number of users per PC, which is 3.5. "If this is the figure for the PCs we track, wonder how much more it will be if we take into account the PC population of the entire country. In our estimate, the total number of people connected to the net in the country should definitely be at least 12 million," concludes Ramani.
Merchant, in contrast, has a different system of evaluation - taking the base as the urban literate population. The absolute numbers are so huge that even if a small per cent of that uses the net, it translates into a relatively large market. For example, 160 million urban literate adults yield 6 million net surfers, accounting for 4 per cent of the all-India urban population. "And we haven't even looked at the below 15 years age-group, some of whom now have access to the net with many upmarket schools including PC training as part of their regular curriculum," reiterates Katy.
With the future seemingly bright for the 'new kid on the block' (read Internet), will the growth come at the cost of traditional media?
"Prima facie, it doesn't seem to have eaten into the time spent on other media," says Shripad Kulkarni, managing director, M:Ideas. "It will, however, eat into TV viewing time - but slowly and over a long period of time." Agrees Nagpal of Stratagem Media, "I don't think the Internet will cut into traditional media consumption. In fact, the first effect of a new medium is that it increases consumption of all media. For example, if four years ago, an individual would spend two-and-a-half hours reading a newspaper and watching television, now with the growing incidence of the net, his total media consumption has increased to four hours."
The NRS 2001 data makes the picture pretty clear. The table shows the share of media among all urban adults vis-a-vis the net users last year.
As the table shows if 16 per cent is the time spent by an urban adult on print, it increases to 22 per cent for a net user. The same goes for Internet. In the case of television, however, though the percentage share has declined from 72 to 52, in absolute terms, the time spent by a net user is higher than an urban adult. Only radio has shown a decline from 11 per cent to 8 per cent.
So what is the prospect of the new medium? "Very bright," says Nagpal. "If I were to do some crystal gazing, an Internet reach of 20 million is a foreseeable target in two years."
Merchant, on the other hand, strikes a cautious note, "If the much discussed broadband really enters the scene and the optic fibre technology becomes an everyday reality, the scenario will be vastly different. As I see it, there will be a phased introduction to these services. Moreover, for these to be a success, we need to have the basic infrastructures in place." © 2002 agencyfaqs!