TVs, mobile phones spearhead shift in rural India

New Delhi: Chanderi, a small town of 40,000 people in the Ashoknagar district of Madhya Pradesh, is best known for its weavers. A decade ago, the inhabitants would spend their evenings in the town square, chatting. There was little else to do. Such gatherings are rare now, says Quaiser Jehan Qureshi, a local school teacher.

Instead, residents now spend their evenings watching TV or surfing the Internet, according to data compiled in July by Digital Empowerment Foundation (DEF), a New Delhi-based non-profit organization that seeks to find solutions to bridge the digital divide.

The media footprint of the inhabitants of Chanderi is telling—40% have TVs at home, 37.5% have mobile phones, 20% have Facebook accounts, although just around 2% have a computer at home—but it is likely indicative of the media habits of rural India.

In September, Shyam Saran, a 35-year old lacquer maker from Samode, a village in Rajasthan’s Chomu region bought a Panasonic laptop computer while on a routine visit to Delhi.

“I don’t know how to use it, but since the kids are growing up, it is useful to them,” says Saran, who lives in a comfortable two-storied house with 19 other members of an extended family, and makes a modest living selling bangles. Apart from the laptop, the family owns four television sets, eight mobile phones, and an old battery-operated radio set that comes in handy during extended power cuts.

Like Chanderi and Samode, much of India’s hinterland has gone through a major transformation, reflected in the latest round of consumption data put out by the National Sample Survey Office. It shows that spending on non-food products such as durable goods, fuel, clothing, footwear and other miscellaneous services increased from 36.8% in 1993-94 to 50.4% in 2011-12.

For the first time, more than 50% of the increased rural spending is on non-food products and services— and mobile phones and television sets (and monthly mobile and cable TV bills) top the list.

“Mobile hai sabse bada badlaav (mobiles are the biggest change),” says Shashi Lal Kumar, 30, a resident of Bihar’s Motihari who, aptly enough, works as the caretaker of a telecom tower that provides wireless connectivity to the region. “You’ll find mobile phones with everyone around here. We have more mobile phones than people here,” adds Kumar who owns four mobile phones himself.

According to the Telecom Regulatory Authority of India, as of June, India had 873 million mobile connections. Of these, 522 million were in urban areas, with the remaining 351 million in rural areas. There are 46 million active Internet users in rural India, according to an i-Cube report, titled Internet in Rural India, published by lobby group Internet and Mobile Association of India and IMRB, a market research firm.

Even if both numbers are to be discounted—India measures mobile connections, not active subscribers, and the definition of an active Internet user is one who has accessed the Internet at least once in the past month—they are still likely to be significant.

It is telling that the first major non-food purchase of most households is either a television or a mobile phone, in that order. Still, this shouldn’t surprise anyone, says Osama Manzar, director of DEF, who is also an occasional columnist for Mint. “Entertainment is the strongest need, especially among young people in rural areas.”

Increasing traffic between rural and urban India, made possible by better road connectivity, has amplified this need, according to Raj Kumar Jha, manager, knowledge insights, at Geometry Global, part of advertising and public relations firm WPP Plc. “If you look at the census, there is a big belly of population between the age group of 18-45. This is the earning and then spending bunch, they are exposed to modern gadgets and lifestyles, they are mobile to visit towns and cities and come back to villages and bring back a lot of information.”

According to the 2011 census, there are 316.5 million people in the age group referred to by Jha in rural India. Some of them travel to larger towns, even metropolitan cities, to study, and many others, to work.

And although rural consumers buy mobile phones largely for communication, they are increasingly viewing these devices as their “window to the world”, according to Anupam Vasudev, chief marketing officer of wireless service provider Aircel Ltd.

“Mobile has made entertainment personal and the rural consumer values it a lot. Earlier, consumption of entertainment was a community-based exercise which has now become distinctive and personal; it’s like having a voice of your own. They have access to everything that the urban consumer has. The only difference perhaps would be in the scale of which they receive it,” said N. Rajaram, chief executive officer for data services at Bharti Airtel Ltd, India’s largest telecom provider (operator??).

Both Rajaram and Vasudev speak of the importance of video content on mobile phones in rural areas.

“Penetration of mobile is higher than conventional media in most rural markets. With the evolution of the mobile device in rural India, from a simple communication device to a complex one which offers entertainment, banking and information, the opportunities are endless for both consumers and marketers,” said Abhiroop C., head of media services at Unilever (South Asia), which earns a sizeable portion of its revenue from India’s villages and small towns.

Indeed, half of the 12 million downloads from Airtel’s new video store launched in May (a video costs ₹ 1) are from rural areas. And local vendors do good business selling SD cards with content usually culled (illegally) from Bollywood.

“Video breaks the barrier of literacy,” says Rajaram. “The minute it becomes vernacular, it goes viral.”

The average spend on such mobile entertainment is ₹ 50-100, according to Jha.

Take Qureshi, the school teacher at Chanderi. She now uses an Intex phone (that runs on Android) she bought five months ago to watch movies or entertain her 18-month-old son with episodes of Chhota Bheem, a popular TV cartoon show.

Or take Raghav Mahto, a mechanic in Bihar’s Mansoorpur village. He watches movies and music videos on YouTube. Mansoorpur sees power cuts of around five hours a day, and young men huddled around a mobile phone on street corners, watching music videos, is a common sight.

Low-cost phones such as Celkon, China Mobiles, Intex and K-Touch are popular in rural markets, says Manu Sharma, general manager, mobile products, Samsung Electronics Co. Pvt. Ltd.

SD cards are a popular way to store and share content, adds Sharma, but many of the devices are so-called feature phones. “A whole new ecosystem needs to evolve for them to be able to use smartphones and Internet to its full potential,” he says. “The effort from our side is to bring down costs. Besides that, language is the biggest barrier.”

There are no language problems with television, though.

The advent of satellite TV connections has accelerated the spread of television in rural India. Dish TV India Ltd has 11 million connections, of which nearly half are in rural India. Tata Sky Ltd has 11.5 million subscribers. The company did not respond to queries on the percentage of rural subscribers.

And rural viewers aren’t just content to watch the free-to-air channels.

“Nowadays, I feel they are moving towards paid packages and want to watch channels like Life OK, Colors etc. You see, television doesn’t qualify only as entertainment for them, it is their source for fashion, news, religious content etc,” says Geometry Global’s Jha. “It continues to be a dominant influence-factor in their lives.”

According to Dish TV, an average rural customer spends ₹ 220 a month on accessing television programmes.

“One trend which is evident is the shift from free-to-air channels to paid ones. We have seen a decline in growth for our free-to-air channel packs, even though it is almost 50% cheaper than the regular packs,” said Salil Kapoor, chief operating officer, Dish TV.

“The other big shift is in their video viewing habits. The rural consumer is moving beyond movie channels, which were very popular earlier, to watching entertainment channels, english movies dubbed in regional languages, as well as channels like Discovery and National Geographic. They’re much more experimental now.”

Bollywood and sports channels are the obvious favourites, although there’s an audience for Hindi or regional language soap operas, reality shows and religious channels.

Television drives more than just media habits. It is a medium that often gives rural consumers a glimpse of life (and lifestyle) they’d like to imitate or aspire for—whether it is the clothes worn by actors in movies and soap operas, the latest cars and gadgets that have been launched, or the furniture used in film sets.

Jha claims women watch soap operas with an eye on fashion trends.

“They like to know if the bali (a type of earring) is in fashion or the jhumka (another type of earring),” says Jha. “I’ve interacted with women in Bihar and Uttar Pradesh and their primary reason for watching shows is fashion trends.”

Apart from what they pay for the channels, rural consumers are also not reluctant to spend on the devices. Motihari’s Kumar, for instance, has a 22-inch Videocon LCD TV.

“With the price gap between CRT (cathode ray tube) televisions and LCD televisions narrowing, rural consumers now prefer to upgrade to the LCD (liquid-crystal display) sets. The price difference between the two is roughly ₹ 3,000,” said Nilesh Gupta, managing partner at Vijay Sales, a large dealer in consumer goods in the country. “With the availability of 19-inch and 22-inch screen sizes at a starting price of ₹ 9,000, this category has gained more traction.”

As many as 16.4 million television sets were sold in rural India in 2012-13, of which 5.6 million were LCD sets, data from Consumer Electronics and Appliances Manufacturers Association show.

The total number of TV sets sold in rural areas may reach 17 million units by the end of the financial year to March while LCD units sold are expected to increase to 7.8 million, the industry lobby reckons.

If mobiles and TVs have become popular in rural markets in recent years, then an old favourite—movies—has made a triumphant comeback.

To be sure, the pirated VCD and DVD market continues to thrive in rural India, but with digitization and the opening of locally owned single-screen theatres, people in rural India can watch the latest releases at the same time as their urban counterparts.

For instance, migrant workers at CTM, an industrial area on the outskirts of Ahmedabad, saw the Hindi film Bol Bachchan, an action-comedy starring Abhishek Bachchan and Ajay Devgn, on the first day of its release in July 2012, at a quarter of the price of a ticket in a typical city multiplex. Earlier, these workers had to travel 15km to Ahmedabad to watch a movie, after buying a ticket they could barely afford.

The movie was screened at a Nukkad Entertainment cinema, part of a chain of digital single screens run by United Mediaworks Pvt. Ltd. to cater to the untapped demand for movies in semi-urban and rural India.

“In the last few years, the entertainment business has gone through major changes. The Internet has played a major role in this development, with people downloading songs at cheap rates, making the movies more popular in rural India,” said Ashish Bhandari, co-founder and managing director of United Mediaworks.

“Digitization of cinema halls in most of the rural centres and towns in the last few years has made first-day first-show a reality. This leads to incremental box office collections. New trends are also becoming popular in smaller regions. For example, in a small place like Umreth in Gujarat, dance classes are very popular, clearly indicating a positive shift in lifestyle changes and dressing.”

Pankaj Jaysinh, chief operating officer of UFO Moviez, explains that earlier it would take movie prints nearly two months after their release to reach villages. But in the last three-four years, digital screening has taken off in small towns. UFO Moviez runs a chain of satellite-based digital cinemas and has more than 1,800 screens across India.

“In the last six years, digital companies have entered rural areas. This has helped production houses release new movies on the same date for both urban and rural customers,” said Bhandari.

Earlier this year, the movie Chennai Express was released in 3,500 theatres across India in a single day—and most of these halls were in small towns and villages.

Nukkad Entertainment plans to expand from western and central India to northern parts of the country. “Our aim is to take entertainment to the grassroots level,” said Bhandari.

This is the sixth in a several-part series Mint will run over the next few weeks examining the key changes in consumption patterns across India over the past few years, based on the official statistics published by the National Sample Survey Office. For the previous stories in this series, go to
livemint.com/ruralconsumption