NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Wednesday, August 13, 2014

There will be more Indians on the internet by the end of this year than there are Americans, according to Rajan Anandan. He should know; Anandan heads up Google in India.

Even more striking than the growth through this year is the growth to come. According to the World Bank’s numbers for 2013, 84.2% of Americans are online. That’s 268.3 million people. In India, 186.7 million people were online as of last year—but that’s only 15.1% of the population. McKinsey forecasts that India will have between 330 million and 370 million users by 2015 (versus 279 million in the US). Anandan reckons that by 2018, there will half a billion Indians online.

A flood of cheap smartphones in the market is encouraging rapid internet adoption. According to Kunal Bahl, who runs Snapdeal, one of India’s largest e-commerce sites, 60% of people who buy a mobile phone from his website have never bought a phone before. They’re mainly gravitating toward smartphones like this one, which runs Android 4.4 and costs $50 (and currently is sold out). Everybody from Google to Xiaomi is rushing into the market.