By R.N.Bhaskar

The Internet has created a boom worldwide. Almost overnight, the world prior to 1999 has become the "old world". And, suddenly, the world based on the ‘TCP/IP’ standard for communication has became become the "new". Although a great deal of the exuberance about "New World" stocks has quietened and the valuations have sobered (some call them depressed), the charm and potential the “new” world holds out continues to captivate almost everybody. The same is true of India as well.

In the world the euphoria was justifiable. All of a sudden you had a means of communicating that was virtually browser and platform independent. It had begun to change some of the very basics in communication. No longer was a switch necessary to hold in place a communication link between two people or parties. All messages could be converted into tiny packets, each moving into whichever channel that was free, yet reaching the end destination as if all the packets belonging to one message had traveled through the lines together. It threatens to make all databases public, and has already permitted the sharing of knowledge and information as never before. Effectively, what the movable type printing press did to publishing of books and pamphlets, the Internet did to all information and knowledge. And the revolution continues.

And within India too, students rejoiced at the way they could access all information across the world.

But from a national and economic point of view, the internet has remained a facility for the rich and privileged. It has not yet become critically relevant to the country because of one simple reason. India is not that well-connected at all. Consequently, much of the euphoria accompanying anything connected with the Internet is both baffling and inexplicable.

Number crunch

Take the basic numbers first:

There are only around 1 million Internet account holders in the country today. As of December last year there were just 10 lake, and the IDC expects this

number to cross 2.5 million by 2002. But these predictions were made when almost everybody was euphoric about the Internet. In these sober times, the pace is likely to be a bit slower, primarily because even the pace of PCs sales has slowed down. But even these optimistic numbers look pathetically low when juxtaposed against India's population of almost 1,000 million.

Then take the number of computers. The installed base of computers is estimated at not more than 5 million, of which barely 15% are in homes. True, the rate at which computers are being purchased every year should be a cause for cheer. Last year, for instance, Indians purchased around 1.5 million personal computers. The number is encouraging, till one -- once again -- juxtaposes it against other numbers. The net growth of population in this country (that is total births minus total deaths) accounted for over 15 million people last year. Thus, only 1.5 million of new people gain access to computers every year, when the population continues to soar 10 times faster. Consequently, the number of "have-knots" will continue to soar faster than the "haves".

The Internet itself reaches barely two hundred cities today. The largest private sector Internet Service Provider (ISP) reaches around 30 cities. This is

even more disheartening considering that India is a land with over 5,000 cities and towns (what the Census terms as urban agglomerations) and over

600,000 villages. Of course, people point to the rapid pace at which telecom companies (telcos) have been laying optic fibre across the country. But this was the same story that was given out when some corporate and US corporate declared that Worldtel would network the whole of Tamil Nadu, Andhra Pradesh and Maharashtra within a year.

It did not happen because laying optic fibre is not all that easy. Do remember that at least three major corporate groups had the right to dig roads and lay optic fibres on account of being basic telephony licence holders. The Tatas held this licence for Andhra Pradesh, the Mittals for Madhya Pradesh and Hughes for Maharashtra. Even three years later, none of these groups has been able to ‘optic-fibre’ and entire city, let alone an entire state. What is even more important is that marrying optic fibre with copper is not easy or cheap. Each junction point requires an expensive piece of equipment called a DSLAM which is also required at the premises of the end customer. Each pair of DSLAMs costs a few lakhs of rupees, and is feasible only for limited distances. Hence the entire exercise may take a lot more time that people believe.

Then take the third indicator. The penetration of telephones too continues to be terrible. The total number of telephone connections in this country is said to be 19 million or just around 22 per 1,000 people. Moreover, ‘guaranteed’ uptime on leased terrestrial lines accounts for just around 70 cities (that too is spoken about; not a single telco is willing to accept stiff penalty clauses for any failure for uptime. The rest of India's towns and villages are connected, but no agency is willing to give anyone a guarantee of uptime.

Most important, literacy continues to be awfully poor in India. Without literacy, the computer makes no sense. The common man's phobia of the computer too is something which must be reckoned with. At the same time, those people who believe that the Internet will usher in e-commerce overnight, fail to appreciate the poor acceptability of credit cards in India. At the last reckoning, there are supposed to be 3 million credit cards in the country and just 2 million credit card users. Some estimates put the number of cards and users at a higher figure of 5 million and 3 million respectively. But, it must be remembered, that the active number of credit card users is barely 20%, and this is likely to make credit cards not the ideal mechanism to popularise e-commerce over the net, especially when it comes to ordinary consumers.

If all the factors outlined above are to be taken into account, one realizes that the entire euphoria about the Internet in this country may be grossly misplaced. In fact, the biggest culprits are portals advertising themselves as heralds of anew dawn for India (though many of them have begun to close down, choked of funds and unable to generate money on their own). They have, deliberately, glossed over the fact that over 90% of their audience comes from countries other than India (in many cases it is over 95%). Some portals even choose to make highly misleading statements which are meant to make common folk believe that their sites account for and India-based audience which comprises over 50% of the total number of visitors. This ratio is not likely to increase unless (a) the number of Indians accessing the Internet goes up at least 10 times more; (b) currently available bandwidths for Internet access is improved upon significantly.

The only way this can be made possible is

· by using computers as community assets, where more and more people can access the limited number of PCs.

· By promoting the kiosk concept far more aggressively than has been done till today

· By investing in education – both to improve literacy on the one hand and skill development on the other. The first allows more people to use the computer, the second allows more people to get gainfully employed.

· By investing in networks that allow broadband and Internet access to cover more than one-third of the number of towns and cities in India. This means that unless we reach out to over 1,500 cities and towns in the country, the concept of the Internet may remain a privilege for the affluent or the powerful.

· Broadband through cable or VSATs can be used for education

· Internet automatically follows once the basic networks are up and running.

Unless this is done, India will remain backward. Without a network – the VSAT is the quickest route, but the cable is the cheapest and the most effective way for populations that are densely packed in any area – the country will remain bereft of good education and reliable information. Without these, the country is bound to remain impoverished.

That would be a veritable shame.