Rural internet spread to increase five-fold by 2018: study

The proportion of rural internet users in India will increase nearly five-fold to touch 28 crore by 2018, signalling good news for online commerce platforms, according to a new study.

By 2018, the country will have "as many as 55 crore internet users, of which 28 crore would be from smaller towns and cities, expanding at close to 40 per cent a year from six crore in 2014," says the report on digital consumption by Boston Consulting Group (BCG).

The report said that the shift will open up significant growth opportunities for marketers and service providers keeping in mind the dynamics of rural markets in India. "This will help marketers using online distribution through e-commerce to ensure wider product availability," it said.

The report also noted that a majority of Indians who have taken to the internet have bypassed the personal computer phase altogether, and are using mobile devices to go online.

"India has skipped the PC phase and moved on to mobile phones. Interestingly, both rural and urban customers are looking for the same things on the internet," said Nimisha Jain, partner and director at BCG.

Around 70 per cent of rural users access the internet from their mobile handsets, the report said.

Three factors including expanding reach, affordable access and improved awareness will be the primary driver of online growth, the report pointed out.

By 2018, women will account for a third of all internet users from 25 per cent in 2013.

The increasing gender parity will have a major bearing on the internet economy as women control 44 per cent of household spending in India," report said.

As of 2014, approximately 200 million Indians used mobile phones to access internet. The report also noted that content would become more vernacular to cater to the "diverse user base to include larger numbers of rural consumers."

Moreover, the proportion of households that can afford internet connectivity, typically defined as those with annual incomes of over Rs2 lakh, is projected to increase to 67 per cent in 2018 from 56 per cent in 2013.