internet for rural india 44

8/6/2019 Internet for Rural India 44

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INTERNET FOR RURAL INDIA:

2009

August 2010


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Internet for Rural India 2009

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TABLE OF CONTENTS

EXECUTIVE SUMMARY..3

BACKGROUND..4What a re the c ha rac teristics of Rural market? Why should the rura l marketbe a fo c us? How have e xisting initiatives fared ?

PENETRA TION O F INTERNET USE..6How many claimed and active users of Internet exist in rural India? What

has be en the growth of the pe netration over the last few years?

POINTS OF A CCESSING INTERNET...9Where do the rural users access Internet from? What are the dominant

avenues?

PURPOSE OF A CCESSING INTERNET..10What online services do the rural Internet users use? Has there been any

c hang e in online c onsump tion in the last few years?

ITDURA BLE OWNERSHIP.11What kinds of IT durab les do the rural users ow n?

EXAMINING BA RRIERS...12What limitations do the rural users fac e in ac c essing Internet? What fa c tors

limit the m in using this me dium?

TOWARDS CONTINUAL GROWTH14What factors would fillip the Internet usage in rural areas? Is the

rec og nition of enabling rural area s with the Internet use g aining g round ?

A NNEXURE..16Methodo logy a dop ted for the research


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EXECUTIVE SUMMARY

In India, Internet awareness and usage has been increasing with urban cities

a t the c ente r of this growth. The m etros and urba n c ities have expe rience d a

high growth of Internet use since the year 2000. On an average there has

been more than 30% year-on-year increase in the Internet adoption among

urban population. Lately, high growth has been witnessed in non-metros an

indication that the medium is getting increasingly pervasive among urban

populace. In a stark contrast, rural parts of the country are slowly rousing to

this interac tive m ed ium. In sup porting this slow awa kening, initiatives by p ub lic

age nc ies and p rivate firms a re b eing introd uc ed . How ever, the a c hievem ents

by far are limited .

As per our latest round of p rimary resea rc h, Claime d Internet users, who have

ever used Inte rnet, in rura l villages, have g rown from 5.5 Mn in 2008 to 6.46 Mn

in 2009 - a 17% inc rea se in a ye a r. The number of Ac tive Internet users, who

have used Internet in the last one month, has also risen from 3.3 Mn in 2008 to

4.18 Mn in 2009, exhibiting nea rly a 27% increa se. A lthoug h the inc rea se ove r

the last year is apparent, the numbers are not high considering the largepop ulation b ase in rura l villages of the c ountry. To fillip this grow th c onc erted

efforts in fac ilitat ing a dop tion a re nee ded .

Availability of Internet access points is crucial for Internet use to rise in rural

Ind ia. There is a less likelihood of rura l c itizens owning p ersona l c ompute rs; as

a result they rely on fa c ilities p rovided by either pub lic or priva te e ntities. To

support this behavior, public and private initiatives similar to the ones

witnessed c urrently could be an e ffec tive solution. How ever, in a dd ition to theaccessibility, targeted and niche services and content need to be

provisioned, too.

The rura l Inte rnet rep ort show c ases signific ant d eve lopme nts in the Ind ian

rural Inte rnet spac e w ithin the last yea r. It a lso d isc usses initiat ives tha t c ou ld

positive ly a ffec t rura l Inte rnet g rowth. This rep ort a lso d isc usses va rious acc ess

po ints that need ad de d investment to expe dite further Internet a do ption.


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INTRODUCTION

Rura l Ind ia ac c ounts for ab out 70% of the tota l Indian pop ula tion a t 568 Mn

as per Nationa l Rea dership Survey 20061. However till rec ently, rural Ind ia had

not received the sort of attention and investment necessary for increased

Internet pene tra tion. The bene fits of sp rea d ing Internet in Ind ian rura l villages

c ould b e m ultifold. By enab ling rura l pop ulac e towa rds imp roved informa tion

access and direct interaction with government units, it will lead to self-

relianc e and emp owerment.

For increasing Internet penetration, both public as well as private initiatives

have b ee n under wa y. Pub lic sec tor initiatives und er NeG P suc h as SWAN

(Sta te Wide Area Netwo rk) and CSC (Co mm on Service Centers) have been

set up as c ore infrastruc ture nec essa ry to sup port Inte rnet acc ess. Apart from

government enabling the access, there have also been private players like

Coma t Tec hnologies who have b een instrume nta l in imp lem enting p rog rams

for pub lic ac c ess for Inte rnet in rura l villages. The c om pany c laims to have

rea c hed 10 Mn rura l lives throug h a netw ork of ove r 2000 business c ente rs.

Private organiza tions as ITC, Mic rosoft, HUL, Goog le a mong others ha ve a lso

been involved in numerous initiatives to increase PC literacy and Internet

awareness. Initiat ives like e -Choup a l (ITC), Projec t Sha kti (HUL) and

Projec t Shiksha (Mic rosoft) have been ong oing in Ind ia for ab out a dec ade

now. Within the last two years, newer initiatives as Googles Internet Bus

p rojec t ha ve a lso he lped in inc rea sing Internet a warene ss.

ITC s e-Cho up a l initiative ha s bee n ab le to rea c h out to over 4 million farme rs

throug h 6500 kiosks and in the p rocess reac h over 40,000 villages. The

initiative has helped to grow a range of crops including soybean, coffee,

wheat, rice and pulses. It provides useful information about the weather as

we ll as the ma rket p rice of the food grains, so tha t fa rme rs a re not exploited .

Along simila r lines, HULs Projec t Sha kti has he lped Inte rnet p enet ra tion to rise

amo ng wo me n in rura l Ind ia throug h Projec t Shakti and its iShakti c om munity

porta l. The p rojec t now c a ters to 135,000 villag es ac ross 15 sta tes and now

ha s 45,000 wom en entrep rene urs. Both e-Choup a l and Projec t Sha kti have

ITCs e-

Choupal

initiative has

been able to

reach out to

over 4 million

farmers

through 6500

kiosks and in

the process

reach over

40,000 villages.

It further

provides useful

information

HUL s Proje c t

Shakti caters to

135,000 villages

across 15 states

and now has

45,000 women

entrepreneurs.

1 Nat iona l Rea dership Survey c onside rs individua ls more than 12 yea rs of a ge.


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been notable initiatives by the private sector that have inspired other

enterp rises to invest the ir energies in rura l Ind ia.

The initia tives, desc ribed above , are the initial flashes of a tte mp ts towards

ena b ling rura l citizens for imp rove d informa tion a c c ess. Considering the large

and diverse population that the country houses, no amount of Internet

adoption seem to impress a dent in the penetration figures - a fact more

p ronounc ed in rura l reg ions. With such a la rge pop ula tion, the sp rea d of the

Internet adoption has to be expansive enough to establish a fact that the

med ium is be ing ad op ted .

The rep ort reflec ts on the find ings from the p rimary resea rch c ond uc ted a s a

pa rt o f the I-Cube 2009. This rep ort deta ils on the pene tra tion o f the Internet

use as well as usage characteristics among the rural citizens of the country.Below are the details of the survey sample as well as the weighted base for

the stud y.

Sample Weig hted Base

Fac e- to-Fac e Survey

Conducted

14,987 294 Mn

- And hra Pradesh 1,562 43.6 Mn

- Assam 1,839 17.8 Mn

- Ma harashtra 2,096 45.6 Mn

- Orissa 2,337 25 Mn

- Tamil Nadu 1,862 29 Mn

- Ra jastha n 2,382 33 Mn

- Utta r Prad esh 2,909 100 Mn

Non- Internet Users 14,392 290.2 Mn

Claimed Internet Users 595 3.8 Mn

- Ac tive Inte rnet Users 357 2.6 Mn


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PENETRA TION O F INTERNET USE

In rural India, newer artifacts, products or technologies have always been

introduced after the urban parts of the country have enjoyed their benefits.

Simila r has bee n the c ase with the Internet d issem ination; while t he Internet

medium has assumed firm roots in the urban cities and metros, citizens in rural

villag es are still in the proc ess of b eing aware o f the m ed ium. To e nsure tha t

the Internet is spread across the rural regions of the country, multi-faceted

c ohe sive effo rts nee d to be introduc ed . Suc h e fforts a re o nly possible if all the

factors that support digital interaction such as devices, connectivity and

content are provided to suit their specific requirements.

Since last yea r when o ne o f the first resea rc hes wa s und ertaken to fa thom the

Internet ad op tion a mo ng rura l village s, there has bee n an e videnc e o f uptick

in the o verall numbers. In I-Cube 2008, it wa s estima ted tha t the re w ere 5.5

Mn c laimed Inte rnet users, in rura l villages, who had ac c essed it at least onc e

in the past or are using p resent ly. At tha t point it formed a little more 10% of

the nations Internet users (as of 2008, there were 55 Mn claimed Internet

users). Of the 36 Mn w ere a c tive Internet users in the c ountry, less tha n 10%

(3.3 Mn) w ere from rural villag es.

I N I - C UBE

2008 face-to-

face survey

was

conducted in

rural villages in

5 states(Assam,

Andhra

Pradesh,

Maharashtra,

Uttar Pradesh

and Orissa).

In I-Cube

2009, two

more states

were surveyed

Tamil Nadu

and

Rajasthan.


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Figure 1: Internet pene tration a mo ng rura l villages in 2008

In I-Cube 2009, the survey was conducted in 7 states (Andhra Pradesh,

Assam, Ma ha rashtra , Orissa , Ra jastha n, Tamil Nadu a nd Utta r Pradesh)among 15,000 individuals residing in villages. As per the primary research,

the re a re 3.8 Mn c laimed Inte rnet users in the rural villages in these sta tes. In

the se 7 sta tes, the re a re 2.6 Mn a c tive Internet users. For All Ind ia, the number

of Claimed Internet users is 6.46 Mn and there are 4.18 Mn Active Internet

users. The Inte rnet p enetrat ion for Rural India ha s increa sed from 0.97% in 2008

to 1.13% in 2009. Ra jastha n and Tamil Nadu we re a dd itiona l sta tes surveyed

in 2009. Of the p eo p le surveye d in Tamil Nad u and Ra jastha n, the re were

1.10 Mn and 282,000 Cla imed Inte rnet users respec tively. Inte resting ly, Tamil

Nadu had a significantly high proportion of Active Internet users of 89%

around 1 Mn suc h users.

A C L AI M ED

IN TERNET USER isone who has

used Internet at

least once in

their lifetime. An

A CTIVE

IN TERNET USER is

one who has

accessed the

Internet at least

once in last one

month.

Figure 2: Internet pene tration a mo ng rura l villages in 2009

Based on our 2009 findings, there are about 6.5 Mn claimed Internet users

ac ross Ind ia, which rep resents a 17.27% inc rea se in c laime d rural Inte rnet users

in one yea r. Similarly, as compared to 2008, the re w as a 26.67% rise in the

num ber of a c tive rural Inte rnet users in 2009 - from 3.3 Mn in 2008 to 4.18 Mn in

2009. Furthe r, the ove ra ll p rop ortion o f Ac tive Internet users to C laimed

Internet users ha s risen from 60% in 2008 to 65% in 2009. In o ther words, peop le

in rura l Ind ia ha ve b ee n using the Internet m ore reg ularly than they ea rlier did .


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In the year 2009, there has been 17% growth in Claimed Internet users and

27% in Active Internet users. It is expected that this rate of growth will

continue. By the year 2010, the total number of Internet users in rural villages is

will grow to 7.7 Mn of which 5.4 Mn w ill be Ac tive Inte rnet users resulting in 30%

grow th from the yea r 2009. Furthe r, the o verall p rop ortion o f Ac tive Inte rnet

users to Claim ed Internet users ha s risen from 60% in 2008 to 65% in 2009 and is

expe c ted to increa se to 70% in 2010.

Figure 3: Internet penetration estimates from 2008 - 2010


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POINTS OF A CCESSING INTERNET

Considering the general lack of personal ownership of digital gadgets and

the initiation of c om mo n servic e c ente rs, CSC a nd c yber c a f a re the p rimary

mode of accessing Internet in rural areas. As illustrated in the figure below,

more tha n 70% of rura l users ac c ess Inte rnet through CSCs/ c yber ca fs.

People, however, access cyber cafes that are located at distances greater

than 10 km away, many more times than those possibly within 10 km of their

village. How eve r, with the CSC schem e rea c hing va rious pa rts of the c ountry

hroug h the Gove rnme nt o f Ind ia s SWAN (Sta te Wide Area Netw ork sc hem e)

initiative, Internet access promises to be easier in the immediate future.

Friend homes and computer institutes also enable rural people to access the

Internet.

t

Common

Service Centers

(CSC) scheme

ha s

demonstrated

credible

progress over

the ye ars.

Currently, CSC /

Cyber Cafes

are the main

access points

for rural peo ple.

CSCs are likely

to become the

main access

points for

people in rural

India.

Figure 4: Ma in po ints of a c c essing Internet in 2009


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PURPOSE OF A CCESSING INTERNET

As in the ea rly sta ges in urban Internet use, rura l users a lso ac c ess Inte rnet fo r

communication. Email is the dominant purpose of Internet access in rural

Ind ia. It is inte resting to note tha t a fter co mmunica tion, 67% of the rura l users

acc ess music and video ove r the Internet. Ab out 48% of the peop le c la im to

have used the Internet for educational research and 42% claim they used it

for general information search.

Figure 5: Purpo se of acc essing Inte rnet a mong rural users in 2009

With the p roliferation of initiatives as e-Cho upa l, Sha kti and so on, rura l pe op le

have started using the Internet appreciably for agriculture-related aspects.About 13% of the people use the Internet for knowing more about latest

farming te c hniques and 8% of the p eo p le use the Internet to find m ore ab out

fertilizers and pestic ides. This is an imp orta nt p oint to note c onside ring the

importanc e of farming in rura l Ind ia. If there a re Internet rela ted initiatives

with farming as a focus, these could certainly trigger Internet literacy to rise

faster.


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ITDURA BLE OWNERSHIP

Amo ng IT prod uc ts, land line te lep hone c onne c tions dom inate ow nership of IT

durab les. Am ong the respond ents surveyed , 3.5% ow n land line telep hones

(approx. 10.39 Mn connections), 1% own PC or laptop (a little more than 2

Mn). Expec ted ly the b roa dband o wnership is rea lly low a t 0.1%.

Base: Among 14,987respo ndents surveye d in 7

states in 2009Weighted Base: 294 Mn rural

individua ls in 7 state s in 2009

Figure 6: IT Durab le Ownership pattern a mong rural users in 2009


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EXAMINING BA RRIERS

Non-awareness of Internet typically has been one of the main reasons why

ernet has not pene tra ted a mo ng the rura l peo p le. In the seven sta tes

surveyed, about 84% of the respondents who had not used Internet in the

past indica te tha t they a re no t a wa re o f it. Further, 38% do no t fee l the nee d

for it. A fairly high pe rc enta ge of respo ndents either nee d guida nce in using

Internet (25%) or a PC (28%). Further, a proportion of respondents indicate the

nee d fo r infrastruc tural setup suc h as lac k of e lec tricity, Inte rnet c onnec tion or

app rop riate acc ess points.

IntNon Awareness of

Internet (84%)

ranked as the top

most reason for

non-usage.

PC Litera cy (31%)

also was among

the reasons cited

for non-usage of

Internet.

Base: Among 14,392

respo ndents surveye d in 7

states in 2009Weighted Base: 290.2 Mn rural

individua ls in 7 state s in 2009

Figure 7: Rea sons for Non-Usage of Inte rnet a mong rural users in 2009


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TOWARDS CONTINUAL GROWTH

The p otentia l for rural Inte rnet grow th is tremendous. How ever, it is imp era tive

that the government machinery ensures seamless execution of various

p rojec ts within the set time. With co re infrastruc ture in p lac e, priva te

operators will be keen to exploit this untapped market and eventually

expedite Internet reach and growth. Related to this, specific targeted

content for village dwellers need to be offered so that the continued usage

and imp ortance o f ac c essing Internet is rea lized .

For rural Internet penetration to rise, setting up core infrastructure is extremely

imp ortant. Unlike mo bile telep hony infrastruc ture, w here c om panies are a b le

to recover capital expenditure costs relatively quickly, broadband service

p roviders a re una b le to d o so. The Go vernment of Ind ia has rea lized the

same a nd invested in sc hemes as the CSC a nd SWAN. Investments in co re

infrastructure suc h a s sett ing up op tic fibe r c onnec tivity through the SWAN

sc hem e are notew orthy. CSCs ac t as end p oints for the SWAN. Finding the

right p eo p le to m anage CSCs will be imp ortan t for the suc c ess of this sc hem e.

CSCs will ha ve to p rovide c ontent tha t villag ers c an ea sily unde rsta nd anduse e ffec tively. Finding releva nt types of c ontent, their p roviders and tra ining

are few of the immediate challenges ahead for the success of the Internet

adoption.

Peop le nee d to b e e duc ate d o n how the Internet c an serve a s an e xc ellent

informa tion resource a bout a variety of top ic s. With a m a jority of peop le in

rural India dependent on the farming industry for their livelihood, the Internet

can provide useful information about farming products that are on offer inthe market. Ava ilab ility of suc h produc ts, p ric es that the y ca n be p roc ured

for wo uld b e ea sily availab le throug h the Internet. Peo p le c ould p roc ure

these prod uc ts a t c om petitive p rices and ma ximize their pote ntial b ene fits.

Weather information, which is crucial for farmers, could easily be accessed

throug h the Internet. Informa tion ab out imp end ing we a ther c ond itions c ould

be known before hand and farmers/people related to the farming could

p rep are b ette r. Rura l citizens should a lso be ma de awa re on ho w the Internet

could p rovide loc a l new s conveniently. Moreo ver, informa tion abo ut


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upcoming community initiatives could also be known to the people through

the Internet. An effective method of disseminating these sets of

und ersta nd ing p riva te o r pub lic initiatives show c asing these c apab ilities of the

digital medium m ay go a long w ay.

Literacy could also be an important factor in furthering Internet awareness.

With the Gove rnme nt of Ind ia m aking p rimary ed uc a tion a funda me nta l right ,

literacy in rural areas will rise at a faster rate. With increased literacy, there will

be greater number of people who are aware of computers and be PC

literate.


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A NNEXURE

The resea rch te am a t eTec hnology Group with IMRB International a dop ted a

c om b ination o f resea rch tec hnique s for this rep ort.

Quantitative Resea rch

Prima ry resea rc h ha s been c ond uc ted in line with I-Cube ' rep orts, an annual

synd ica tion o f eTec hno log y Group , IMRB Inte rna tiona l.

The synd ica ted resea rch is ba sed up on a p rimary resea rc h survey tha t

interviewe d about 15000 pe op le from va rious age group s, ac ross SECs andgenders from the sta tes of Assam, Ma ha ra shtra , Orissa , Tamil Nadu, And hra

Pradesh, Ra jastha n a nd Utta r Pradesh.

Selec tion of States

Populat ion Levels - Sta tes were d ivided in te rms of their populat ion leve ls. For

appropriate representation, we selected states having high and medium

populations.

Literacy - Literacy rates were examined for all the states and compared

aga inst the p op ula tion. The sta tes we re d ivided and selec ted as having high,

me d ium or low literac y leve ls.

Per Cap ita Inc om e - Sta tes we re seg reg a ted as having high, med ium a nd

low pe r c ap ita inco me with respe c t to the p op ula tion o f these sta tes.

Disadvantag ed Groups - Sta tes we re the n c om pared on the basis of

po pulation of disad vanta ge d g roup s and urba n po pulation.

FactorsUttar

PradeshMaharashtra

Andhra

PradeshOrissa Assam

Population High High High Med ium Med iumLiterac y Leve l Low High Low Med ium Med ium

Per Ca pita

IncomeLow High Me d ium Low Low

Disadvantaged

GroupsMe d ium Low Low High Low

Urban

PopulationMed ium High Med ium Low Low

Geographical

RegionNorth West South East North - East

Tamil Nad u & M aharashtra have the highe st literac y level amo ng the highe r

pop ulat ion sta tes. Simila rly, And hra Prad esh & UP ha ve the lowest level of


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literac y in the high p op ulation sta tes. Orissa has the highest no. of peo p le

among the medium population states which belong to disadvantaged

groups. Per capita income of Maharashtra is the highest among the highly

pop ulate d sta tes. Simila rly, UP ha s the low est per ca p ita inco me level in the

high population states. Assam & Orissa also have low per capita incomeleve ls amo ng the me d ium po pulate d sta tes. Assam & Orissa ha ve the low est

urba n po pulation a mong the med ium p op ulate d states.

Summ arizing, the rat iona le fo r selec ting the g iven samp le c an b e g iven

below:

Sam ple Selec tion

As pa rt o f selec ting the samp le, we took three step s.

Step 1 Distric t Selec tion

Out of the a ll districts in a sta te , a samp le of 6 districts wa s c ove red ensuring a

geographical spread across the state. It was ensured that the chosen districts

wo uld a deq uate ly rep resent the pop ula tion of a p a rtic ula r sta te.

Step 2 Selec tion o f Villages within the Distric t

6 villages we re selec ted within a d istrict. Out o f these villages, 2 ea c h were o f

low population (< 1500), medium population (1500 2500) and high


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population (>2500). A village is divided into a group of hamlets (cluster of

houses). The m ap o f eve ry villag e w as d rawn with the he lp of the

Mukhiya/ Sarpanc h of tha t village . The ham lets we re num bered in a c loc kwise

ma nner and one ham let from ea c h villag e w as c hosen rand omly.

Step 3 Selection of Respondents

Rural respondents from 6 villages across every selected district were

interviewe d . There w as a lso a sp lit on the basis of the stra ta of the

respond ents dep end ing o n their SEC c lassifica tion.

Sec ondary Resea rch

Sec ond ary resea rc h was done using information from va rious pub lished and

priva te source s and other resea rc h bod ies to t riang ulate our find ings.


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About IMRB International and IAMAI

e-Technology Group | IMRB (a specialist unit of IMRB International) is a research based consultancy

offering insights into IT, Internet, Telecom & emerging technology space.

Our continuous link with industry and a constant eye on the pulse of the consumer ensures that we

can decode the movements of technology markets & consumers. To our clients we offer an

understanding of the present market environment and a roadmap for the future.

Contact Details

eTech Group | IMRB

IMRB International

A Wing, Mhatre Pen Building

Senapati Bapat Marg, Mumbai

Tel: (91)-22-24233902

www.imrbint.com

Research Team for this Report

Balendu Shrivastava, Group Business Director([email protected])

Tarun Abhichandani, Insights Director

Harshal Deorukhkar, Consultant

About Internet and Mobile Association of India (IAMAI)

The Internet & Mobile Association of India (IAMAI) is a not-for-profit industry body registered under theSocieties Act, 1896. Its mandate is to expand and enhance the online and mobile value added servicessectors. It is dedicated to presenting a unified voice of the businesses it represents to the government,investors, consumers and other stakeholders. The association addresses the issues, concerns andchallenges of the Internet and Mobile economy and takes a leading role in its development. Theassociations activities include promoting the inherent strengths of the digital economy, evaluating andrecommending standards and practices to the industry, conducting research, creating platforms for itsmembers, communicating on behalf of the industry and creating a favorable business environment forthe industry. Founded in January 2004 by leading portals in India, IAMAI in the only specialized industrybody in India representing the interests of online and mobile value added services industry.

Contact Details

Dr. Subho Ray, President, IAMAI406, Ready Money Terrace, 167, Dr Annie Besant Road, Mumbai - 400 018

Tel: +91-22-24954574 | Fax: +91-22-24935945 | http :// ww w.iamai.in
http://www.imrbint.com/http://www.imrbint.com/

internet for rural india 44

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