## Sunday, August 23, 2009

### Where is India in Internet adoption?

Where is India in terms of usage of the Internet? One way to think about this question is to look at specific application areas. I saw three fragments of evidence:
Writing in Hindu Business Line, Rajalakshmi Sivam has interesting information about the share of online trading on NSE:

 2006 Today Number of trades 20% 33% Rupee turnover 15% 25%
Railway tickets
Writing in Business Standard, Sharmishtha Mukherjee says that 34% of the tickets sold by Indian Railways were sold online.

Banking transactions
Business Standard has an article with some facts about the shift away from that barbarian relic, cheques.
Ordinarily we might have thought that the rich trade on the stock market, and have better Internet connectivity. So one might have expected a bigger share for Internet commerce with online trading. But it's quite striking to see the proportion of online trading at NSE (33%) line up almost exactly with the proportion of online ticketing at IR (34%). IR users are likely to not have broadband at home: they're probably using Internet cafes. Two other areas are of interest:
• Does someone know about the extent to which airline tickets are purchased over the net. Speaking for me, perhaps 80% of my air travel gets done through cleartrip.
• Is there traction with craigslist in India? The few times that I have looked, I've not been impressed at the liquidity.
Turning to supply side concerns, there are two problems. The first is bandwidth. India does fairly badly on broadband, owing to policy impediments. We're all waiting for the 3G rollout to get a quantum leap in bandwidth.

The data above, for NSE trading and Indian Railways, is the picture that we're seeing in pre-broadband India. I think that in the coming five years, a full quarter of the households of India will have a broadband connection (either through a computer or through a smartphone), and that will generate profound change.

The second constraint is development talent. By and large, most websites done in India are just bad. I can think of two possible explanations:
• It seems that computer programmers in India do not get the Internet. There's probably too much of mechanical use of tools and techniques learned on Windows PCs; there's probably too much Microsoft in the formative years of young people. More study of good quality systems is called for [link]. Recruiters should be looking for people who do not have a worldview shaped by the Windows desktop. Extensive experience around Windows should be viewed as a negative qualification when putting together product teams today.
• While there is a lot of services work going on in the domestic computer industry, there is very little product development going on. The typical staffperson has spent his life implementing someone else's spec. When he is thrust into the role of building the very concept of a product, the outcomes are often bad. The idea of a dedicated product team, which obsesses on how users are interacting with a product and how things can be improved, is not mainstream. Basic concepts of usability are lacking in the people who build products.
The best role model that I show all software developers, about a decent e-commerce website, is cleartrip. A bunch of people who get this need to start a hall of shame for badly designed web systems and e-commerce systems in India. My suggestion for the first case study to write up there is: `Bhuvan' by ISRO.

1. "The second constraint is development talent. By and large, most websites done in India are just bad. It seems that computer programmers in India do not get the Internet. There's probably too much of mechanical use of tools and techniques learned on Windows PCs; there's probably too much Microsoft in the formative years of young people."

I thought, I was the only person who lamented the void, the eerie silence from the lack of Indian hackers. Now, hackers, I dont mean the "psycho sw guys out to infect the world with viruses", but the real geeks who can tear apart a Linux Kernel and say, hey what's this!!!
How many of resident Indians are in the Linux development team? A handful possibly!I don't know!

As for websites, man they unilaterally suck. And I think, its because, the usability is plain pathetic! Absolutely pathetic. ISRO doesnt care about usability, it just thinks, "hell yeah I make it, use it or leave it"

I hope, Indian e-commerce will make their websites more usable in the coming decades as more India-oriented portals come up and they compete for the tight purse strings of Indians. As for Govt, I hope lateral entry (sth you discussed sometime back) into public service and policy making catches up in the coming years.

Soham

P.S: If any ecommerce entrepreneurs are reading this Nielsen-Norman's reports are great places to start.

2. Soham,

Can you give us URLs for Nielsen-Norman's report (ideally some that are freeware)?

3. Actually NN reports publish their own research for a hefty price, though I wouldn't recommend them to startups, but reading Jakob Nielsen's blog useit.com is a good place to get better ideas.

For product design Don Norman's blog jnd.org is also a good place to get the basics.

Incidentally Norman was the usability guy for Apple. You can search for his talk on TED Conference [http://www.ted.com/index.php/talks/don_norman_on_design_and_emotion.html ]

Soham :)

4. I usually track Akamai Quarterly Report at:
Akamai State of Internet Report

Soham and Prof Shah, kindly have a look...

Best,
Manu Bhat

5. I found this very exhaustive and quite respected resource at useit.com

113 Design Guidelines for Homepage Usability

Best,
Manu Bhat

6. It is interesting that you mention Cleartrip. I worked there for two years in the dev team. It was very interesting how a bunch of lisp and ruby hackers, who were quiet young, were perceived to be by the management: biggest liability that organization had and were needed to be chucked out as soon as possible.

And thats exactly what they did. Hired a hardcore "services" sector mentality jerk,a yes boss saying development lead and a would-be-CTO, who's only goal was to meet-the-timeline and make the CEO happy. It doesn't matter whether the product actually worked or not. He used to say "Don't think just do"! The broke the fabric of the whole team. Murdered the culture. Soon everybody got so disgusted that they left.

India is not an easy place to do internet business. Penetration is one thing. Rat-mentality people are another and IMO bigger challenge. Try putting together a team of hardcore geeks and then hire a boss from some Infy/Wipro/Oracle and see everything go downhill from there. No wonder we do not produce products like Facebook, google, twitter et al.

7. http://www.ravikiran.com/blog/classic/200803/indian-it-clients-are-victims-of-the-bangalore-bug/

I wrote on this some time back

8. Anonymous,

Man,you confirmed something today, which I was afraid and had a slight hunch all the time. You know what the hunch was?
That recruits from Infy/Wipro/bigwig too big to fail type places can never fit in a startup.

@Manu Bhatt,
Yes, I did go through AKAMAI reports some time long back, yes, its very exhaustive and perhaps very authoritative.
Its worth it.

@All,
I am glad, that this blog is slowly turning into an informal social network of ideas and in turn a place to bounce off ideas. Nice, very nice!

9. Most internet railway bookings in Bangalore happens through dedicated agents who also do air tickets, bus tickets, photocopying, faxing etc... This kind of mechanism seems to have spread to a lot of places in south Karnataka..

Pls. compare craigslist with sulekha..

10. Good information.

Thanks for posting

11. Srinakth,

I just looked at sulekha. It is filling a yellow pages purpose. But it isn't doing the remarkable shift away from B2C towards C2C that craigslist achieved. Craigslist is just so much more interesting (when it works) when compared with what sulekha could pull off.

12. Wireless telephony adoption exploded in India when MTNL and Reliance brought down the entry prices to ridiculously low levels (atleast by the standards prevailing back then). since then a whole host of innovation has taken place in terms of packages, handset offerings, etc.

i think we are looking at a similar scenario today...and I think the recent announcements by Airtel are a step in that direction. Airtel now offers a 512 kbps line with unlimited downloads + a wireline phone connection (with 150 free calls per month) - all for 700 bucks per month. i think it is an attractive option, but i am sure it can be bettered by competition and maybe in a year or so we may get the same or even a better connection for half the rate. the minute we have broadband connections at rates less than what we pay for our cable tv...broadband adoption will simply explode (atleast the penetration with people who already own a pc will improve big time). Telecom companies may even choose to provide desktops/laptops/netbooks on credit, cost of which can come down substantially when taken net of Microsoft products or the unnecessary add-ons (for normal computing) like core2duo intel chips..etc.

in addition to cleartrip there are a handful of other e-commerce success stories in India -

1). icicidirect.com (this is a site that according to alexa.com fares much better than nse/bseindia.com) and also accounts for a large chunk of internet-based trading.

2). flipkart.com (India's version of amazon.com minus the used books option). i've had awesome experience with them. they offer better rates than all the book stores (except for maybe strands or a distributor) and their delivery is quite efficient too. for me, i've simply stopped buying books from any other place.

3). irctc.co.in
5). naukri.com
6). zapak.com (its a gaming site, the quality of games can & may improve with time...)

13. Just a thought, failure of product companies in India is mainly due to lack of risk-taking ability.
In general, success ratio for these businesses is hardly 1% and my thought is we are not good at investing that much money as well as time.

It will be interesting to know what others think or if there are any interesting statistics relating to this.

14. Ravi Purohit,

Where do you see this ? URL please.
"Airtel now offers a 512 kbps line with unlimited downloads + a wireline phone connection (with 150 free calls per month) - all for 700 bucks per month"

-Tarun

15. Tarun,

I don't have a URL for that. I received a leaflet from Airtel a couple of days back, which had details about a whole host of such schemes.

In that comment, I missed one point - the unlimited downloads are valid for night, whereas for daytime, there is a limit (if i remember it correctly) of about 3 GB per month. Besides, if you pay for 6 months in one shot, they are waving off the installation and equipment charges and are offering a wi-fi router at a nominal rate.

Incase, you are interested, you may also want to checkout Hathway's broadband connection. It offers a 512 kbps line (with unlimited downloads in the night with a daytime limit of about 4GB spread over 3 months). I found it to be very good and efficient. Hathway charges quarterly for this; @ about Rs.1750/- per quarter it amounts to Rs.567/- per month. I've used broadband services of Sify (had a horrible time with them), Hathway (best experience), & Tata Indicom.

PS: I stay in Bombay. I don't whether it's applicable in other cities or is available in other cities, etc.

16. About the issues with development talent...

Sure, developers should be savvier in terms of usability, web analytics, etc. Especially for startups, one typically wants a few core people who can multi-task and look at the big picture, conceptualize, etc.

But, to make an alternative argument which applies especially in terms of IT divisions within companies that do things apart from having an online presence (indian railways, etc). One can look to dumb down the process, look at it from a boring IT manager's perspective and assemble a team of good developers (who worst case may be poor with UI/ usability) and good UI designers/QAers (who need not even be developers). The developers can continue to do what they do best - take specs from the UI designers + QAers + management and hook up the application.

The fault is in thinking that developers who might be good at writing web applications and deploying them might necessarily be good with design/usability or that design/usability is unimportant or that it does not take time and effort.

17. I think you're right on the money with this. I think the reason being that the mentality in India (shamelessly broad generalisation based on no evidence) is that the Internet is the 'secondary' option, where you dump the second-raters.

In cases where they design their systems around the Internet, the end result is awesome -

Cleartrip
ICICI Bank (whose website is clunky, but it's simple, and it works - their 'B2' website has a much nicer design)

There are also probably others I don't know about.

The nightmare websites are plentiful:

Try checking your bills and account status at
Airtel
Vodafone

These 2 companies' websites are complete horrors. They are designed purely from their point of view, and the user seems to be an afterthought. It is absolute inexplicable (in Airtel's case), why they measure your broadband usage in either rupees!!!! or units of 10kB!!! when your limits are in GB. How difficult is it to show broadband usage as:

Data Usage: 2.51GB as opposed to either:

Discount: -3556.00

And as for Vodafone, you have to get through 4 pop-up windows to finally get to see your bill.

IRCTC is a known devil, but I think we all instinctively raise our tolerance threshold when dealing with anything Sarkari...

LaTeX mathematics works. This means that if you want to say $10 you have to say \$10.