The Shape of Internet to Come
Voice, video and
vernacular languages take centre stage as internet companies hone an arsenal of
features to lure the next wave of 100-150 million internet users
Metro, millennial and male. For
much of the past three decades, these three descriptors have broadly covered
the country’s internet users. Most users have also been English-conversant and
reasonably technology-proficient — starting with desktop computers, moving to
notebooks and now mostly on smartphones. However, as the internet economy —
with 400-500 million users, a market for products and services valued at $413
billion (according to a Bain-Google report) — enters a new phase, companies are
now on the hunt for India’s next wave of users, with a firm focus on features
and innovation that will help lure them in.
The Indian internet economy is a
highly stratified one. Even though it has some half a billion users, only 50
million have ever carried out a transaction, by some, admittedly contentious,
estimates. This creamy layer has been rather well penetrated by the big players
such as Amazon, Flipkart, Oyo and, Ola and several others. As companies strive
to convert more internet users into transacting customers, there’s growing
realisation that new features and strategies that will aid in that task are
likely also the ones that will help onboard the next 100-150 million users.
The internet of today is still
mostly designed for the creamy layer, and the language is predominantly
English. But how does someone who has never seen a supermarket, understand
intuitively that the cart icon is what you click on a shopping app to go to
billing? And how do you solve for native tongue in a country with 22 major
languages? These are some of the questions companies are grappling with as they
start building for the next wave.
Just 30 km from Bengaluru’s
airport, outside of Dibbur, 19-year-old V Nagendra typifies the new internet
user these companies now pursue. Besides some exposure to a PC at school — he
dropped out to help his family out — his entire technology world exists on his
smartphone. “Everything can be done on this,” the gangly teen says, pointing to
his handset, while hanging out with friends on the highway to Hyderabad. “I
watch videos, keep in touch on WhatsApp and three months ago got on ShareChat
to browse Kannada and Telugu content.” The growth and popularity of local
language app ShareChat, funded by Shunwei Capital and Morningside Ventures, is
in some ways indicative of the changes to come. ShareChat’s valuation grew
seven-fold in nine months, from $67 million to $460 million.
Investors, too, seem to be sensing
this shift. “WhatsApp and ShareChat will be the utility wave, but beyond that
we think services such as banking and payments will be a big draw for these
users,” says Sanjay Swamy, cofounder of Prime Ventures, an early stage
investor. While investors like him wait for users to graduate from basic usage
to actually transacting online, they’re already placing their bets in this new
market. “As an investor, we see a strong case for building businesses ground up
for this market,” he adds. “These bunch of users were seen in the distant
future — that time frame has now shrunk.”
The rules and dynamics of catering
to that market will be very different from the norms now.
“There is a paradigm shift in
India’s internet,” says Rajan Anandan, vice-president-South East Asia and
India, Google. “For a very long time, India’s internet story was defined by
metro, male and millennials. But this has changed completely in the last few
years.” Many of these metrics are rapidly changing. There has been a four-fold
increase in rural internet users. India’s data consumption, now at 8GB every
month per subscriber, compares with developed markets. And the transacting
audience is as large as 170 million, Google claims.
The tech giant’s bets on India’s
next generation of users provides a barometer for its peers to judge the
market’s potential. For example, it has partnered with Railtel to provide Wi-Fi
access at over 400 stations (eight million users and counting), expanded its
public Wi-Fi efforts in Pune and Andhra Pradesh — with plans to reach a crore
people across the state, many accessing the internet for the first time. Google
has also built India-first and India-only products to bring in first-time users
and launched support on its Gboard handset keyboard in 50 Indian languages,
with its voice assistant understanding eight Indian language inputs and Chrome,
its web browser, translating web pages into 11 Indian languages.
The addition of new users in India
is being catalysed by other factors, too. Entry-level smartphones have got
cheaper (70% of smartphone shipments have 2GB+ RAM now, compared with 6% in
2014. Some 80% of smartphone shipments now have 16GB+ storage, compared with
0.2% in 2014) and data prices have plummeted. These changes have reeled in
millions of new users in the past few years as they’ve leaned on low costs to
consume and transact online. An assortment of companies has used various
strategies to cater to these new users. “An important conundrum these companies
need to consider is that even though the number of users is exploding, the
number of transacting consumers isn’t keeping pace,” says Harsha Razdan, who
head the consumer markets unit at KPMG India.
Voice, Video,
Vernacular
As the hunt for India’s next wave
of users intensifies, there’s a consensus that their use of the internet will
hinge on three areas: voice, video and vernacular applications. “More companies
will build engagement without assuming that India is an English-driven market,”
says Arvind Pani, CEO of Reverie Language Technologies, a vernacular language
venture. “As companies chase after these new users, there will be a lot of
experimentation around methods of registration and transaction — take off is 18
to 24 months away.”
For over eight years now, Reverie
has been chipping away to be ready for this next bunch of users, building
capability for search and discovery in multiple languages, interfaces to engage
via text and voice and the ability to better understand the underlying intent
of these new users.
“We want to solve the problem of
user engagement, not just be a provider of translation or speech solutions,” he
adds. Until 2015, Reverie focused on providing display and input solutions in
vernacular languages for brands (including for Google’s Gingerbread OS, for
which it provided language support in a range of south Indian languages) and
two years ago, it shifted its focus to building stronger user engagement. For
example, it built a platform for the Union Ministry of Agriculture, to reduce
dependence on intermediaries (target of 8 million users in agriculture), an
e-marketplace for government procurement and works with corporates such as Ola
(80% of drivers use apps in local languages) and Practo (40% of clinics and
doctors sign on in vernacular languages) to better understand users.
Internet users have historically
followed a routine in their usage. For the current cohort of users, this began
with getting online and browsing and consuming mainly text content. Then, they
started using the web for rudimentary services, often delivered by banks and
government agencies. The third phase saw them actually transact online, after
gaining confidence in the medium.
In India, there’s yet a disconnect
in the last phase, with large numbers of users being browsers alone. The next
wave of technology hopes to bridge this gap. “The previous decade of India’s
internet, and related business, was focused on an audience comfortable with
English,” says Aprameya Radhakrishna, CEO, Vokal, a vernacular language
venture. “But this next generation wants content, communication and commerce in
non-English languages and without typing.”
Googles’ Anandan agrees, adding
that most Indian internet users browse in Indian languages — that number is
expected to touch 500 million in two years. Statistics from Google provide some
answers on how India’s next wave of internet users behave. The country has seen
270% growth year-on-year in voice searches, with 95% of video consumption
happening in local languages. “India is expected to have over 650 million
Internet users in the next few years, and all these new users are coming from
tier 2, tier 3 and rural India,” he says.
Language Play
Radhakrishna has some idea of both
sets of internet users. For four years, between 2011 and 2015, he founded and
ran Taxi For Sure, a homegrown taxi aggregator, that had 50 million users when
it was sold to Ola for $200 million. TFS was in the midst of India’s internet
boom that saw the birth and growth of a raft of other ventures in cab
aggregation, finance, food and travel.
This time around, things look
distinctly different. “The last decade of the internet was focused on
aspirationally western opportunity … the first wave of 100-150 million users
was highly focused on an English audience and western products,” he contends.
“Outside of this bubble, you find another India.” Vokal, for example, has over
half a million downloads for its app that allows people to ask and answer
questions in Hindi, for now, and 10 more languages soon.
“You have to try a series of
things to get a fix on your business model,” he says. “The use cases are yet
evolving — the English-centric audience isn’t sending good morning messages to
all their groups.” Despite the growth of the internet, these new users behave
differently; they download and share content more, but yet don’t have a place
to ask questions in their own languages and get the answers they want.
It won’t be homegrown ventures
alone chasing after this new internet user. Chinese startups, especially those
providing content in local languages, focused on video, are seeing strong
adoption. “We are extremely positive about the Indian market,” says Johnny Wu,
regional director for the Indian and European market for LiveMe, a video
content provider from China. “We want to build a strong content brand in
India.”
Having worked around the mobile
internet space for much of the past decade, Chinese internet firms such as
LiveMe, a video streaming content maker, News Dog, Tik Tok and Share It are
looking to cash in on their learnings among new internet users thirsting for
fresh content. Live Me has built studios in Delhi and Mumbai, with at least
five to six hours of content being created daily for this emerging audience.
“Content and entertainment is a strong hook for this audience, but soon we will
all have to figure out how to monetise this audience.”
As India’s internet economy hunts
for this next wave of users, this question will be top of mind for companies
operating in this market.
rahul.sachitanand@timesgroup.com
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