Indians spend 7.3 hours on phone every day, more than Americans and Chinese: Report

The growing online presence of Indians on a daily basis is mainly due to the country's cheaper data costs and affordable smartphones (starting at $60, roughly around Rs 5,000), the report highlighted, adding that this sets the stage for high digital opportunities for consumer internet players.

Interestingly, India's mobile data pricing per GB of usage is among the lowest in the world. With Prime Minister Narendra Modi's 'Digital India' push for affordable data pricing across telecom majors, the country's data cost per GB is just above Israel's. Redseer's report mentions that as of July 2022, India's mobile data pricing per GB stood at $0.17 (roughly Rs 140) as against China's $0.41 and US' $5.62.

Due to the above factors, Redseer report added that at 780 million, India is home to the second-largest internet user base in the world, which is more than two times of the US population.

It also noted that with the accelerated growth of internet and smartphone adoption, "India is expected to surpass 1 billion internet users by 2030."

State of India's digital economy. (Graphic: Moneycontrol)

Further, identifying the typical internet users in the country, Redseer's analysis divided the users into three cohorts – explorers, transactors and mature users. "Given that the internet users’ growth has exploded over the last 3-4 years, a large number of them (400-450 million) are in the early phase of digital life – they are exploring digital services (social, media, content, gaming and OTT). As the user builds comfort using the digital services and trusts them, they graduate from one cohort to another," the report added,

Commenting on the report, Mukesh Kumar, Engagement Manager, Redseer Strategy Consultants said,“India has ~350 million online transactors across e-commerce, shopping, travel and hospitality, and OTT. We estimate there are 40-45 Mn mature users; these are the users who spend a considerable share of their wallet online (more than 50%). We expect online transactors to become 2X by 2030, with mature users being the faster-growing cohort. We also estimate that these mature users would account for $400 bn online spending by 2030."

Growth in UPI payments

According to the report, with the increasing digital India push and explosive growth of unified payment interface (UPI) transactions, internet users are becoming comfortable paying online on digital platforms. Currently, there are over 350 million online transacting users in India, of which 250 million use UPI for payments.

The report also added that growth in UPI payments led to around 110 million paid online gamers in India, second only to e-commerce.

Gaming is adding around 2 million paid users per month. Every second internet user is a gamer in India, and every third transacting user in India is a paid gamer. Gaming has almost 450 Mn users in 2022, and the market will see a 33 percent rise in paid gamers by 2026, the report further stated.

Digital media usage

Another major contributor to internet usage among Indians is digital media and its role in customer decision-making criteria. Redseer report noted that for the first time, the number of eyeballs reached by digital platforms is expected to surpass traditional media by 2025. Digital ads account for around 53 percent of the total ads spent in India in 2022. Online shoppers have started to depend on digital channels such as social media, e-commerce marketplaces or general online searches for decision-making. Therefore, brands and retailers can’t ignore digital media channels in their advertisements and brand campaigns, the report added.