E-Commerce Grabs Spotlight at India Internet World

Dozens of experts from around the world delivered Internet business advice to over 850 delegates at the recently-concluded three-day India Internet World conference in New Delhi, co-hosted by Mecklermedia and Bangalore-based Micromedia.

“In too many countries the lack of competition and surcharges for
Internet access are tragically slowing down markets,” said keynote
speaker Gene DeRose, CEO of New York-based market research firm Jupiter
Communications. He strongly advocated telecom reform in India to bring
about better and more affordable services for Internet connectivity.

Though India is well equipped with technical and English-language
skills, its Internet economy is being held back by an inadequate
infrastructure and a lack of progressive political will regarding
Internet policies.

Electronic commerce via the Internet in India totaled only $2.8 million
in 1997, according to Ravi Sangal, president of market research firm IDC
India–but could reach $160 million by year 2001 if leased line costs
drop sharply.

Hotmail founder and CEO Sabeer Bhatia, an Indian citizen who grew up in
Bangalore and Poona, was treated almost like a folk hero thanks to the
astonishing success of his free-mail service, started in 1996 and now
accounting for over 23 million users worldwide, thus making it the
largest e-mail service in the world.

“Just think–Hotmail could just as easily have been based in India, but
the conditions turned out to be more favourable in Sunnyvale,
California,” said Bhatia in an interview. Bought for an estimated $400
million by Microsoft late last year, Hotmail plans to launch German,
French and Japanese versions of its service before venturing into the
embryonic Indian language Internet market.

Internet marketing consultant William Hunt said Indian companies can tap
unpenetrated foreign markets in Europe and Asia through multilingual ads
and localised content. He suggested Indian pharmaceutical companies
producing herbal medicines and Indian tourism agencies could tap the
Japanese market using multilingual Web sites.

Ross Veitch, producer of Yahoo! Asia, said Indian online publications
had useful content for portals like Yahoo. “We are also looking for
online ad representatives for Yahoo in India,” he said.

Experts like intranet consultant Mellanie Hills (author of the
bestseller “Intranets as Groupware”) urged Indian companies to move
beyond stand-alone consumer-oriented Web sites to interlocked extranets
with their business partners.

“Gartner group studies indicate that 80 per cent of e-commerce
transactions will be done on extranets. And 80 per cent of the
e-commerce in the future will be on the intranets and extranets,” Hills
said. As of now, almost 70 per cent of U.S. companies are setting up
either intranets or extranets, according to Hills.

Indian companies like Mumbai-based Aptech are making rapid forays into
the Internet training and online education markets. The education market
on the World Wide Web will grow to $100 billion by the year 2001,
according to Ganesh Natrajan, CEO of Aptech. Numerous other Indian
companies are emerging as Web solutions providers, or outsourcing houses
for U.S. Internet companies like Cybercash.

Chandrababu Naidu, Chief Minister of the southern state of Andhra
Pradesh, is one of the few Internet-savvy forward-looking politicians in
the Indian Internet scene. His “Vision 2020” programme includes
provision for Internet kiosks in every village, an Indian Institute of
Information Technology, intranets in most government departments,
toll-free long-distance access to the Net, and online access to vital
information by ordinary citizens, tourists, and foreign investors.

His government is already working on alliances with Singapore Network
Services, McKinsey Consulting, the World Bank and Carnegie Mellon
University for Internet-related projects.

The half-million user Internet market in India still has to mature via the formation of Internet industry associations, third-party services for traffic audits, and lobbies for progressive cyberlaws. For instance, advertising revenues of Indian online publications are expected to really take off only when audit data to capture the amount of traffic to these sites is available.

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