The Hindu Business Line : Small, medium biz may invest $1.2 billion on Net: Survey

Nearly two-thirds of the PC-owing SBs in India are connected to the Internet even as MBs have reached near-saturation in terms of Internet adoption.

Kolkata June 3 Small and medium businesses (SMBs) in India are expected to invest $1.2 billion on Internet infrastructure and solutions in 2007, according to a study conducted by the New York-based Access Markets International (AMI) Partners, Inc. This marks a rise of $300 million vis-a-vis Indian SMBs' spend on Internet access and solutions in 2006.

The study states that, within the overall spending pie, small businesses (SBs) dominate in terms of the overall expenditure on Internet access. Medium businesses (MBs) account for roughly one-fourth of the overall expenditure on the Internet.

Internet Adoption

According to the study, nearly two-thirds of the PC-owing SBs in India are connected to the Internet even as MBs have reached near-saturation in terms of Internet adoption. Despite this, there is substantial scope for bridging the adoption gap in the case of more advanced Internet technologies like e-commerce, e-purchase, intranet, etc.

In fact, SMBs are increasingly viewing the Internet as an integral part of their overall business operations rather than as just another technology tool for facilitation of their business transactions.

While building a basic Internet connectivity, infrastructure continues to be a priority for Indian SMBs, this is especially true in the case of the larger SMBs since robust connectivity serves as a backbone for future anticipated adoption of advanced technologies such as VPN and WAN.

Deploying Broadband

At present though, over 60 per cent of the Internet-related spending of SMBs is devoted to Internet access technologies. Broadband usage is also a priority for over 90 per cent of MBs and nearly 70 per cent of SBs, whose attitude indicate that deploying broadband access or enhancing broadband Internet speed would be a strategic focus area over the next 12 months.

The study states that the number of Web site-owning Indian SMBs is set to grow by around 60 per cent in 2007 over last year. The growth of e-commerce is also on the rise.

"As Indian SMBs become increasingly aware of the multiple benefits of possessing and maintaining Web sites, the latter's share of SMB Internet expenditures is set to gradually increase. Web sites enable a typical SMB to showcase its products and services for customers and also to reach out to the global business community at reduced marketing costs," states the AMI Partners study.

It adds that, within the search engine category, the most frequently used Web site is Google, with 46 per cent of Indian SMBs having used it in the past one year.

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