India small and medium businesses (SMBs, or companies with up to 999 employees) are increasing their spending on Internet products and services. The overall spending on Internet and website-related products and services by India SMBs totaled US$1.45 billion in 2009. AMI predicts this spending will continue to rise in 2010. In fact, Internet spending shows the highest year-over-year growth among India SMBs, when compared to the various ICT products and technologies. These findings come from a study by New York-based Access Markets International (AMI) Partners, Inc., a leading consulting firm specializing in the IT and telecom sectors.

“A majority of Indian SMBs have indeed reached saturation in terms of adopting basic connectivity infrastructure,” said Mr. Dev Chakravarty, Assistant Manager - Research, at AMI-Partners, India. “Yet a considerable gap remains in terms of using technologies such as broadband, websites, intranet, e-commerce, etc.” It is surprising to find that more than half of PC-owning SMBs in India still do not subscribe to any kind of broadband service. Within the different Internet-access technologies, the most preferred lines by SMBs continue to be DSL and cable modem.

The Internet is also viewed as "a key strategic focus item” for a majority of India SMBs. “AMI’s recent study indicates that India SMBs are not yet satisfied with their present connectivity infrastructure,” said Chakravarty, “since improving Internet or networking bandwidth/connection speed is the topmost priority of India SMBs in the next year. More than 70% of businesses echoed these sentiments. This indicates that ISPs still have some way to go before they are able to provide the ideal broadband services to India SMBs.”

In the past, digital social media—social networking, blogs, etc. —was being used for the most part by India consumers; yet we are seeing that more and more India SMBs have also started riding the digital bandwagon in a bid to be on par with their global counterparts. The AMI survey shows that currently as high as nine-in-ten Internet-using SMBs in India use some kind of digital social media for business or professional purposes. Professional social networking sites (e.g. LinkedIn) and general social networking sites (Facebook, Twitter) are the two most frequently used digital social media by Indian businesses. Internet-owning SMBs use these social media tools mainly for activities such as sales/marketing, keeping in touch with customers, advertising/business promotions and recruiting new employees.

One in four India SMBs have websites. For the most part these websites are hosted on third-party vendors’ or service providers’ servers. Many India SMBs have shown an interest in deploying their own websites within the next 12 months. “Even if a fraction of these deployment plans are translated into actual practice, this entails a significant boost of website penetration within India SMBs,” noted Chakravarty. For a significant proportion of India SMBs, the key purposes of websites are to provide information about their organization, provide products and service information/demonstrations and to quickly respond to questions from customers and prospects. The website can act as a very useful marketing tool for India SMBs since it enables them to transgress the national boundary and showcase their capabilities to a wider potential customer base throughout the globe—at a negligible cost compared to traditional marketing methods with a large sales force.

About the Study

These findings are from AMI’s SMB Global IT Forecast Model. This forecast model blends proprietary AMI-Partners 2009 research with public econometric data. The model incorporates current and historic results of AMI's end-user surveys, along with supply-side data and secondary research pertaining to the medium business market. This forecast provides coverage across key areas of AMI's IT and communications field research.

AMI produces forecasts annually that cover the previous calendar year as well as five years ahead. The current forecast encompasses the period from 2008 to 2014 and is provided in a flexible, easy-to-use pivot-table format that enables users to view the data by whichever categories are required.

For more information about AMI-Partners, or our global SMB research, call 212 944 5100, e-mail ask_ami@ami-partners.com or visit our web site at www.ami-partners.com.

About Access Markets International (AMI) Partners, Inc.

AMI-Partners specializes in IT, Internet, telecommunications and business services strategy, venture capital, and actionable market intelligence — with a strong focus on global small and medium businesses (SMBs), and extending into large enterprises and home-based businesses. The AMI-Partners mission is to empower clients for success with the highest quality data, business strategy perspectives and ―go-to-market solutions. Led by Andy Bose, the firm has built a world-class management team with deep experience cutting across IT, telecommunications and business services sectors in established and emerging markets.

AMI-Partners has helped shape the go-to-market SMB strategies of more than 150 leading IT, Internet, telecommunications and business services companies. The firm is well known for its IT and Internet adoption-based segmentation of the SMB markets; its annual retainership services based on global SMB tracking surveys in more than 25 countries; and its proprietary database of SMBs and SMB channel partners in the Americas, Europe and Asia-Pacific. The firm invests significantly in collecting survey based information from several thousand SMBs annually, and is considered the premier source for global SMB trends and analysis.