Internet penetration grew 39% last year

The number of active Internet entities increased to 1.29 million in March 2002 indicating an increase of 15 per cent over March 2001. The penetration of Internet among businesses grew to 39 per cent from the earlier 36 per cent and while a marginal increase led to 11 per cent penetration in the households. The business segment now contributes 48 per cent of the total active Internet subscribers and households account for the remaining 52 per cent, according to a finding released yesterday by Manufacturers Association of IT, an apex body of the hardware industry. 

The industry performance review for FY 200-02 indicated that the desktop PC market grossed 167,000 units - registering a negative growth of 11 per cent over the previous year. PC sales had clocked a growth of 34 per cent in the FY 2000-01 over that of 1999-2000. The severe recessionary trend in the Indian economy has adversely impacted the domestic hardware market. The market witnessed significant slow-down in IT consumption in general manufacturing, banking & finance and media & professional services sectors. However, with imminent recovery in the Indian market, the IT market is expected to grow at 12 per cent in FY 2002-03, with projected PC sales of 1.9 million units.

MAIT's Industry Performance Review - ITOPs, conducted by the leading market research firm IMRB (Indian Market Research Bureau), is bi-annual and aims to address the hardware sector's efforts to manage the business environment, gauge the market potential and consumer trends. The first mid-year report evaluates the industry's performance between April-September and the second, between October-March. This round of the study involved face-to-face interviews with over 14,000 respondents selected randomly from 16 cities in India. The study was initiated by MAIT in 1996-97 and leading IT hardware vendors subscribe to it. The study encompasses five broad product segments - computers, networking products, printers, other peripherals and Internet. 

As per the MAIT-IMRB study the assembled PCs - the smaller lesser known regional brands and unbranded systems - accounted for 46 per cent of the PC sales in 2001-02. The proportion of the assembled PC sales shrunk from 53 per cent in the previous year - a negative growth of 22 per cent. The poor performance reflects the fact that price sensitive market segments deferred their IT purchase plans in 2001-02.

However, the MNC brands maintained a robust performance - a market share of 35 per cent, up from 27 per cent in 2000-01 despite registering a negative growth of 17 per cent. The Indian brands accounted for 19 per cent of the market. The share of the Indian brands in 2000-01 was 17 per cent. 

The MAIT-IMRB Review reveals that PC sales, both to the business segment and to the households declined by 11 per cent as compared to the sales in the last year. In the second-half of 2001-02, the market recovered, but not sufficient enough to result in positive growth.

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