Through its $10 billion India Digitisation Fund, search giant Google has made two back-to-back investments in the category of social networks and short videos as it seeks to expand its presence in the emerging digital ecosystem in the region.
Investments in Dailyhunt and InMobi’s Glance have come at a time when domestic and global businesses are looking to capitalise on unprecedented demand from users for short videos brought about by the ban on the popular short video platform TikTok owned by Chinese Bytedance.
The rising base of Indian language users, who are expected to drive future growth and account for the majority of the Internet base of the country in the coming years, is at stake.
100 million new internet users have come online from rural India in the last two years alone. Data shows that rural use now accounts for about 45 percent of the country’s total mobile data use and focuses mainly on online video, Caesar Sengupta, Google’s vice-president, said in a blog post.
More than a dozen short-video apps have been vying for the top spot since the ban on TikTok in June, including Glance-owned Roposo, Dailyhunt’s Josh, and MX Player’s TakaTak.
Times Internet, the digital arm of The Times of India Group that also publishes The Economic Times, owns MX Player.
The long-form video market is dominated by Google-owned YouTube, but it still lags in the short video space, with YouTube Shorts in the early beta phase in the country, far behind peers.
In July, Google chief executive Sundar Pichai had earmarked $10 billion to invest in India over the next 5-7 years, with an emphasis on areas crucial to the country’s digitisation efforts.
It soon chipped in nearly $4.5 billion for a 7.7 percent interest in Jio Platforms-owned Mukesh Ambani.
Investing and collaborating with domestic startups that are creating solutions to meet the needs of Indians in local languages has been one of the Fund’s main focus areas.
“These investments underline our strong belief in a deep partnership with innovative start-ups in India and our dedication to working towards the shared objective of building a truly inclusive digital economy that will benefit everyone,” Sengupta said.
It is expected that a stake in the two local language platforms would help Google deepen its penetration with rural users.
These applications, in particular local language users who use entry or mid-level smartphones, have a scope beyond metro and tier 1 cities. The overarching aim of Google is to improve its current ecosystem by filling up distinct holes. To meet the next billion users, you need a well-connected content distribution system because their demand is very different from what you see in metro cities,” said Pavel Naiya, Senior Analyst.
