High phone rates driving away Net users in India

In India, thousands of people are reducing their use of the Internet in response to increasing telephone rates, further reducing the average of 4 users for every 1,000 people. The number of Internet connections by individuals and companies is now 3.8 million, down from more than 4 million in December 2002.

Some context: fewer than 2% of India's more than 1 billion people have regular access to a phone line; fewer than 1% have a personal computer. Only one in 2,000 has ever used a cell phone. More than 40% are illiterate, and 1 in 4 lives in abject poverty. Almost 95% of the connections are through phone lines. An hour of Internet time could cost more than 24 rupees (50 cents), a day's wages for an average Indian housemaid.

This article quotes an official from the Internet Service Providers' Association of India. He speculates that the dropoff in Internet connections might reflect the use of Internet cafes, which offer an hour's browsing at 15 rupees (30 cents). He also attributes the trend to the refusal of the government-linked telecommunications companies to allow service providers to use existing telephone lines. "They look at us as competitors and do not help us. The two sides need to get together to see any real growth in Internet usage in India."

Click here for the full article on the Mercury News site.