Internet remains unaffordable for the masses: Ajit Balakrishnan

The Founder & CEO highlights the stark realities of internet penetration, which stands at 10% in India, & says that for it to reach critical mass, it should be made available at Rs 100 per month

e4m by Sonam Gulati
Updated: Feb 7, 2014 9:05 AM
Internet remains unaffordable for the masses: Ajit Balakrishnan

While people are praising the rapid growth of internet penetration in India, Ajit Balakrishnan, Founder and CEO, and Chairman Emeritus of the Internet and Mobile Association of India (IAMAI) has a different point of view. According to him, we are still behind countries such as Russia, Brazil and Indonesia for the simple reason that majority of the Indian population cannot afford Internet at its current prices.

For a majority of the population with a monthly income of Rs 13,000, internet seems to be a luxury. This income group is the one that calls itself part of the ‘managerial’ groups. Then comes the even lower income group of people such as hawkers, labourers, daily wage workers, etc., for whom internet doesn’t even exist.

According to Balakrishnan, “The right information intermediary can bring tremendous productivity for the society, however, every website must not be considered in the said function.”

He further stated that more and more information has been made available on the internet, but the consumer has to decide what is true and what is not. “We need to equip people with a critical faculty,” he said. “Everything on the internet need not be true, but it also doesn’t mean that everything on it is false.” he added.

However, the most pertinent point that he made was that the cost of broadband in India is unaffordable by masses. “The target broadband price should be Rs 100 per month with unlimited usage,” he suggested. “When there will be more penetration in a manner that the bottom of the pyramid is also consuming broadband, then people will come up with apps that will be suitable for that class and hence it will become an all-inclusive technology,” he added.

Balakrishnan further added that the main reason for broadband being so expensive in India is that it uses spectrum and undersea cable, which are all very expensive. The services should be shifted to Wi-Fi and optical fibre, which are also expensive but only at installation. Post installation, they are cheap and once that cost will go down, broadband prices will dip automatically.

He also said that telecom companies are also one of the big reasons why Internet has remained expensive. “For market cap driven telecom companies, the optical fibre is a very expensive investment. Their stocks will take a beating if they announce laying down massive optical fibre networks,” he noted.

He pointed out a lot of other reasons that result in high cost of the internet. Some of those include depreciation of the rupee, high bandwidth cost, fiscal deficit, policy makers being wary of internet, and dominance of the English language, among others. The Rediff chief busted a growing economy’s myth that Internet penetration is at an all-time high. He concluded by saying that time is also running out for the stakeholders to set things right.

Ajit Balakrishnan was sharing his thoughts while speaking on the bigger picture by culling out five big policy issues for Internet in India at the IAMAI 8th India Digital Summit, which was held at New Delhi on February 6, 2014.

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