Online videos to account for over half of mobile data usage in India by 2016

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With sprawling growth of Internet users in India, then number of users using mobile internet will nearly double in 2014 and over half of mobile data traffic will comprise of online videos by 2017 says Deloitte in its latest research report on India’s technology, media and telecommunication sector.

India is turning out to be one of the ripest markets for mobile internet and related services and owing to the availability of a range of low-cost budget friendly smartphones, the number of users using mobile internet is set to double up in 2014 and reach a whopping 104 million.

“In 2013, there were 51 million smartphone users in urban India. Deloitte believes that this number would cross 104 million in 2014” reads the report. [PDF]

The report pegs video consumption as one of the driving factors of mobile data. “Further, highest video consumption on mobile would be driven by smartphone users who have highest penetration in metros followed by tier I and II cities of India.”

“Deloitte anticipates 50-60 percent of all the mobile data consumption in India to be driven by video over next 2-3 years.”

The report also claims that services such as direct-to-home (DTH) and digital cable, social media and phablets will boost the country’s media and entertainment and telecommunication segments.

Deloitte also claims that rugged devices market is set to double up during 2014 are manufacturers of such devices will increasingly target business and enterprise users in the country. Some of the verticals where such devices will be in demand include banking, retail and insurance agencies. Businesses with the aim of reaching out to rural India are likely to adopt such devices.

The report notes that phablets with large screen sizes found large number of takers in the country during the second half of 2013 and the trend is likely to continue. But, 2014 is expected to be the peak for such devices in the country.

“But after initial rapid consumer success, 2014 may mark a ‘peak phablet’ year, as only a (sizeable) minority of smartphones users will want to handle such a large device”, reads the report.