Google-Airtel Deal Aimed at India's Mobile Ad Market

There's a rich subtext to the recent announcement that Google and Airtel, India's largest telco, have launched a broadband portal called AirtelLive.com. In India, as in China, Japan, and many other countries, users access the Internet more from mobile phones or PDAs than they do from desktops or laptops. (That trend, of course, is developing in the U.S., as well, but much more gradually.)

With 53 million mobile customers, Airtel is simultaneously India's largest private broadband company and telephone provider. So, in the future, insiders say, the two firms plan to offer Google apps on mobile phones. And Google has long coveted the mobile ad market: "What's interesting about the ads in the mobile phone is that they are twice as profitable or more than the non-mobile phone ads because they're more personal," Google CEO Eric Schmidt observed a year ago.

Since at present, only 3.7 percent of India's Internet market has been penetrated, and only 12.3 percent of China's, there is a vast upside awaiting those who establish themselves in both countries early, as Google clearly recognizes.