Mary Meeker's 2019 report says the internet in India is moderately regulated

Mary Meeker, the former Morgan Stanley analyst who started her own investment firm Bond Capital in September 2018, released her Internet Trends report for 2019 (copy below) at Vox/Recode’s Code Conference in Scottsdale, Arizona, on June 11. She started publishing this report that charts the key digital, technological and visual communication statistics and trends in 1995. The 2019 report highlights different approaches to internet regulation across the world, growth in e-commerce sales, increased internet ad spending, growth in data collection, and emphasises increased content moderation by social media platforms in a bid to fight misinformation.

Internet regulation

• In a comparison of internet regulation across USA, 7 largest economies of EU, India, and China, the report says that India is moderately regulated.
• 
• Nandan Nilekani’s comments on Aadhaar included in the report:

• ‘When a service provider sends an authentication request to Aadhaar (India’s National Identity System), the purpose of the authentication is not revealed; all the government knows is when someone uses his Aadhaar number, not where or why. … [Aadahaar [sic] shows] India’s approach to the Internet is simple – empower users with the technical & legal tools required to take back control of their data.”

• Globally, fewer people live in countries where internet is completely free compared to 2016. In fact, 33% of the total population live in countries where internet is partly free, while 34% lives in countries where internet is not free.

Data collection

• Data volume grew from ~10 ZB (zeta bytes) in 2015 to ~180 ZB in 2018. Right now, Consumer and enterprise data account for ~40% each of all this data, but by 2024, IDC predicts that Cloud will house ~45%, enterprise ~40% and consumer ~15%. Given the sheer volume, the need to safeguard this data is apparent.

Privacy and encryption

• Privacy concerns about digital media usage remained high, but appear to be moderating.

• In line with global privacy concerns and increased data regulation, more internet traffic (87%) is encrypted that ever before. Furthermore, more people are opting for default end-to-end encryption apps, especially WhatsApp.

• 447 million sensitive records were exposed in security breaches in 2018 as cyber attacks on sensitive data become more common place.

Internet penetration

• At 3.8 billion internet users around the world, global internet penetration has grown from 24% in 2009 to 51% in 2019. The number of global internet users is growing, but slowed down from 7% to 6% YoY.
• Asia Pacific accounts for 53% of global internet users, but has only 48% internet penetration. North America, on the other hand, has only 9% of the global internet users, but has the highest internet penetration at 89%.

• China houses 21% of global internet users, followed by India at 12% and USA at 8%.

• Number of Jio wireless internet subscribers grew from ~100 million in FY2017 to 307 million in FY2019, doubling in a year. Its physical locations grew from ~4,000 to ~10,000.
• Annual data usage across the Jio network grew from ~2EB (exabyte) in FY2016 to ~17EB in FY2018.
• Global new smartphone shipments have declined by 4%; Android and iOS devices continue to dominate the global market.

Fake news

• Misinformation continues to be a problem and different platforms have adopted varied tactics to handle the situation. Social media has turned into a source for news, especially as these platforms also turn into news aggregators.
• The number of global independent fact-checking organisations has gone up from ~45 in 2014 to ~150 in 2018.

Market leaders in technology

• Of the 30 companies that are global internet leaders in terms of market capitalisation, 18 are American and 7 are Chinese.
• Highest market capitalisation: Microsoft at $1,007 billion (grew 2.5X since 2016)
• Total market cap of top 30 internet firms: $6,119 billion (doubled since 2016)

Top 30 technology firms in the world according to market capitalisation

• Of the 30 companies that are global leaders in terms of market capitalisation, 23 are American, 3 are Chinese, and 9 are technology companies.
• Despite a globally observed move against immigration, USA’s foreign-born population accounts for 14% of the American population and is rising. Meeker’s report said that 60% of the most highly-valued technology companies in USA were founded by 1^st or 2^nd generation Americans. These include Amazon (2^nd generation Cuban), Apple (2^nd generation Syrian), Google (Sergey Brin is 1^st generation Russian), and Facebook (Eduardo Saverin is 1^st generation Brazilian). The list also included Aneel Bhusri, a 2^nd generation Indian who founded Workday, and Francisco D’Souza, a 2^nd generation Indian via Kenya who co-founded Cognizant. Other highly valued technology companies founded by people of Indian origin which were included in the report: Instacart (Apoorva Mehta), Robinhood (Baiju Bhatt), Rubrik (Bipul Sinha, Arvind Nithrakashyap, Arvind Jain, Soham Mazumdar), Automation Anywhere (Ankur Kithari, Mihir Shukla, Neeti Mehta Shukla, Rushabh Parm), Confluent (Neha Narkhede), Sprinklr (Ragy Thomas), and Carta (Manu Kumar).

E-Commerce and advertising

• Since the first quarter of 2010 (~$35 billion), e-commerce sales have almost quadrupled (~$140 billion) in the US. E-commerce sales now account for ~15% of all retail sales in the US.
• Annual internet ad spending grew by 22% between 2018 and 2019 in USA with almost all spending directed towards mobile advertising. However, ad revenue decelerated from 29% to 20% YoY.
• Google’s ad revenue grew by 1.4X between 2017Q1 and 2019Q1 while Facebook’s grew 1.9X in the same time period.

• Customer acquisition cost rose in highly competitive and capitalised sectors. The cost per user activation of mobile finance apps grew from $30 in 2017Q1 to ~$45 in 2019Q1 globally.
• Digital payments now account for 59% of everyday transactions across the world.

Economy

• India, China and USA’s contribution to the global GDP is rising, while Europe’s is falling.

• For 44% Indians, unemployment and jobs are amongst the top three worries in their home country. In USA and Germany, only 11% people count these worries amongst their top 3. Only Italy (69%), South Korea (66%), Spain (61%), South Africa (57%) and Argentina (49%) outrank India.
• Both India and China are seeing growing urbanisation.

Education

• As the costs of traditional post-secondary education are rising, especially in the US, people are shifting to online education. As a result, websites like Coursera and Udemy have seen a dramatic increase in the number of their registered learners (~10 million in 2014 to ~38 million in 2018 for Coursera, ~7 million in 2015 to ~30 million in 2018 for Udemy). 28% of learners on Coursera are from Asia while 30% are from North America.
• Indian e-learning platform, Byju’s, number of paying students have gone up from ~1.5 lakh in 2016 to 17 lakh in 2019.

Internet usage

• Time spent with digital media per American user grow from 2.7 hours in 2008 to 6.3 hours in 2018. This 3.6 hour increase happened across smartphones and tablets, not desktops or laptops.
• American users no spend more time per day on their mobiles (226 minutes) than on TV (216 minutes), a drastically different figure from 2009 when the times spent were 20 minutes and 266 minutes, respectively. This figure suggests that screen times have gone up dramatically.
• In 2010, digital video accounted for only 4% of daily minutes spent watching video (compared to TV). In 2018, this figure rose to 28% in USA.
• In USA, podcast listeners have frown from 22 million MAUs in 2008 to 70 million MAUs.
• Number of people using wearable technology doubled in USA between 2014 (25 million) and 2018 (52 million).
• YouTube and Instagram have seen the maximum increase in daily active users between 2017Q2 and 2018Q4 globally.

Here’s a copy of the report:

All graphs are courtesy of Internet Trends 2019 report by Bond Capital.