State of Mobile Internet in India

Everything around #NetNeutrality and regulating OTT players stems from one source — Mobile Internet in India and I’d like to bring some data to light on the market that will help us understand how data is actually used in our country.

There are many experiments happening globally especially in emerging markets on how mobile internet is consumed. One of them is the idea of Sachet Packs, ability to buy internet in small doses. We did quite a large survey of almost 100,000 hikers on what kinds of data packs they used and based on their usage extrapolated it across our entire user base to understand our them better. Here’s what we saw:

% Data Packs Split. hike survey.

Based on our data, our best guess is that today comfortably over 50% of India’s mobile internet market is still dominated by Sachet Packs & users consuming the internet on a per 10 kb basis! That’s just incredible. The big question that we asked ourselves is — Are people on Sachet Packs/VBC experimenting with the internet? Or is this just how internet is consumed in India?

After speaking to countless number of our users directly, it’s quite clear that the Sachet Pack behaviour isn’t experimental, it’s real internet usage. The bite-sized Minutes/SMS behaviour has carried over to data and every single telco we speak to confirms that this really is how India uses the internet.

India is consuming the internet in a very different way

There are over 1 billion people in India that will come on to the internet for the first time in their lives on a low-cost smartphone. Over 1 billion people will experience powerful compute for the first time in their lives. Should the experience of these people be exactly the same as those of us who’ve had the fortune of witnessing a PC and a Broadband connection and the internet over the last decade?

As we’ve grown hike into a product used by 10's of millions of users sending over 10's of billion messages a month in just two short years, we’ve seen how dramatically different India is with every incremental 5–10 Million users and we’re starting to question that very concept. It’s been an eye-opener for us.

Today, we have users who we speak to who do not know how to sign up to hike despite having hike pre-loaded on their phones. There are users who we speak to, who do not grasp the understanding of what KBs & MBs mean. Bear in mind, we are still speaking about the Top 100 Million. What about the remaining 1 odd billion?

Traditional Zero Rating

That brings me to Zero Rating. What is Zero Rating?

‘Zero Rating’ is a practice where telcos subsidize the cost of data for a specific application to boost usage of data services and to grow their business.

To tackle the mass, many telcos have resorted to zero rating to make the cost of experimenting with the internet zero. Now in essence this may be good for the consumer because cost of trying the internet is zero however, it’s not cost of the internet that’s zero, it’s the cost of a specific service chosen by the telco being zero. This isn’t great for the ecosystem because the telcos ending up favouring one particular service over every other. It’s a bit like VAS. A closed off ecosystem where telcos have final say over which company or service gets preferential access to their network. There is just no transparency.

Note: By Traditional Zero Rating, I do not mean the Airtel Zero initiative. Traditional Zero Rating is things like Facebook Zero. Airtel Zero is a whole different discussion, one I hope to touch upon later.

This brings me to the topic of #NetNeutrality.