PC and Internet penetration in India

Alok Mittal had posted a note on how India Today's cover story mentioned how "most of India's 200 million middle class homes now have computers". The comments there ranged from speculation of whether it meant "microprocessor based devices" (i.e. cellphones) or whether the magic figure was 10 million? or 50?

What do I think?

There's a difference between the number of domestic households owning a computer, number that access the Internet, and the number of computer owning households.

Firstly, the number of PCs sold in India was around 4.3 million in 2006 (IDC). I would estimate the total base at around 30 million (we were 5 million in 2001) and corporates + cyber cafes to have about 85% of that. About 4 to 4.5 million PCs are in houses, and I think even that is an overstatement. I have three PCs at home. Chances are that the real number of PC owning households is around 3 million.

PCs that have a net connection: I think that figure, on a per household basis,is less than 2 million.

Number that access the net - if you consider the huge number of cyber cafe visitors in comparison to PC owners, I'd say 35-50million people was a fair figure. Note that time based visitors to cyber cafes means there's very little internet commerce capability, limited to airline tickets or such. Netbanking and Online credit card sales penetration is still fairly low.

There's a feel good factor, yes. Growth is heady for the top bracket. Penetration is not low because of lack of money; it's the void in reach and infrastructure. By 2015 India will, at the rate it's growing, reach around 150 million PCs with about 10 million in households. Still not anywhere close, I think, to the figures touted.

Other links:
A post on BusinessWorld's May 2006 report on Indian consumers
Forbes.com report