Google expects India's Internet users to triple by 2014 as telecom carriers invest in high-speed wireless infrastructure and smartphones become cheaper, a report said Friday.
Google's country head in India, Rajan Anandan, told the Wall Street Journal that the company forecasts India will reach at least 300 million Internet users by 2014, up from about 100 million now.
With just eight percent of its 1.2-billion population online, India is already the third-largest Internet market by users, behind China and the United States.
"Despite a lot of the infrastructure challenges we have as a country, 100 million Indians are online," Anandan, a former Microsoft executive who took over Google's India operations in March, told the newspaper.
"They're spending a huge amount of time online and they're doing a varied set of things online."
But capitalizing on that huge emerging audience will be challenging in a country where television and newspapers draw the most advertising and the government is throwing up regulatory hurdles.
"Making money off that growing audience, though, is proving difficult thus far for Google and other Internet companies," Anandan told the newspaper.
Indian online ad spending is only about $200 million per year - a small fraction of the $80 billion global digital advertising industry.
E-commerce like airline and movie ticket sales generate about $5 billion in revenue in India compared to a massive $80 billion in neighbouring China, the newspaper said.
Anandan said he expected the next 200 million Indian web users to mainly access the Internet on the high-speed wireless networks that carriers are in the process of rolling out countrywide.
But for India to increase Internet use it is also crucial that mobile handset makers bring out smartphones at prices which India's masses can afford, he said.