Tuesday, December 19, 2006

Traveling Online

Creating new categories seems to be the new business mantra in the Indian IT market. Technology has helped open novel avenues and vulture capitalists are eyeing every move by entrepreneurs to park and grow their monies. As internet penetration in the Indian market increases, more and more innovative online services will be available.

According to IAMAI, internet users in India have reached the 37 million mark in September 2006, up from 33 million in March 2006. This number will rise to 40 million by March 2007! And, India has over 9 million broadband users in 2006 which is expected to touch 20 million by end of 2007 as per TRAI. What it means is that innovative online services will grow quantitatively and qualitatively.

Currently, the Indian market is following worldwide trends. Easy to see why the timing seems to be perfect for the growth rate that has been projected. Online B2C e-commerce is growing at 80% y-o-y as per IDC. At first it was the Online Matrimony players who gained. The latest ones to cash-in are the Online Travel players, a segment that has suddenly become red hot.

The travel market in India is estimated to be around USD 14 billion, that includes railways, bus services, air services, private vehicle services. The online travel market was around USD 300 million in 2005, crossed USD 750 million in 2006 and is expected to cross USD 2 billion by 2008. At 125% growth rate, online travel market is the fastest growing e-commerce segment, accounting for close to 60% of the total e-commerce pie. In addition, the entire online travel segment is fuelled by the rising number of air carriers. 12 operating airlines and more than six new players expected to begin service by next year.

Big budget spends to attract low budget travelers is the name of the game. Players like Makemytrip.com, Yatra.com, Cleartrip.com, Journeymart.com, Travelguru.com and new entrants like Sify, Indiatimes Travel too are making their presence felt in the market.

So what exactly is fuelling this sudden, unexpected boom in this industry? Primarily it is the convenience of desktop destination choosing, price comparison, the get-off-your-butt- every-weekend hysteria and of course, loads of disposable income of urban youth.

In such a scenario, how do the coming days look like for traditional brick and mortar travel agencies? Well, they too can have a share in this pie provided they focus on an all-new target audience, and perhaps offer them with low cost railway and bus tickets.

Now for the new segments that’ll emerge in the coming years. One of them is easily the Heli-taxi service. Imagine dialing 1009 and a helicopter landing on your terrace within 10 minutes. And taking you places. But in a lighter vein, there seems to be one hindrance that needs a little working on. Adequate space on your roof!

I often wonder when will Space Tourism become cheaper and affordable so that one fine day, I can wander in the deep blue sky above, past the moon, and seeing what really lies in those famous black holes. Till I get my hand on my personal Teleportation Machine, let Yatra.com arrange my tickets to Chennai.

Have you planned your New Year destination yet ?


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