What drives people to the Internet? Typically usage is driven by needs that are popularly labeled as falling into the either of the 3Cs – To "Connect” - To consume “Content” or to transact for “Commerce” services.
I estimate the following percentages of total quantum of usage (page views) in India:
Connect: 70-75%
Content : 20-25% (Includes Classifieds – Jobs, matrimony etc)
Commerce : 5%
Connect
One to one contact or one to many / many to one community applications like Email, Messenger , Chat , Clubs, Social & business networking, User generated content services (Blogs, Wikipedia, etc.), Picture sharing (Flickr, etc).
Almost 100% of users use Internet for one or more of “connect” services. Email is the most dominant activity. Importantly enough, community tools such as social networking and photo sharing are extremely popular with the 15-25 age group
Most of the “connect” services are being offered free to users and are being used as “gateways” to acquire users. Monetisation of these users happens through serving advertisements while they use these services or through getting them to do commercial transactions by delivering them paid content, services & product offerings.
Content
I estimate that today only 20-25% users in India are coming to Internet for consuming content pushed by publishers. I have also taken all classifieds services into this category. A recent study done by IAMAI indicates that there are currently 6.1 million job seekers online. On a base of 38 million users this translates into 16% of internet users coming for seeking jobs online!
I have not taken into consideration porn sites.
With social web 2.0 and increasing amount of consumer generated content proliferating internet (Blogs, Wikipedia etc.) on one side and on the other side the dominant gateway for acquiring customers being Connect services. “Content being king” seems to be a little irrelevant today. Any comments ?
Commerce
IAMAI in one of their studies conducted in April 2005 have estimated following:
Internet users in India : 25 million
Number of B2C transactions in Year 2005-06 : 0.8 million.
If we were to take on an average 2 transactions per customer in a year, we will get 0.45 million unique transacting users. Translating into less than 2% share of 25 million total internet users. I think that they have not taken stock broking into account. If we take stock broking, then I estimate that currently, just about 5% of total Internet users are getting into paid relationships with portals, there of course needs to be a larger set of merchants, merchandise and services that need to be offered to the consumers. I have written about this in an earlier post as well.
As Indians get more used to getting their daily news fix online and get more comfortable using their credit card, there would be a quantum leap in terms of users and pageviews. However, over the next few years services that allow users to “Connect” will continue to remain the dominant tool for acquisition of new customers to the Internet. The portals that are able to gather more such customers will be winners in the long term.
