Mobile Youth Report

Xen Mendelsohn talks to Savka Andic, Research Associate at the Wireless World Forum, about the report:

Geographically speaking, China, India and Brazil will continue to be key markets for the next five years, all three of them ripe for growth. In the more mature markets, mobile content is still very much an emerging market for youth with a lot of potential. Operators and content providers are not yet finding the best ways to satisfy youth desire for mobile content, with the notable exceptions of youth MVNOs such as Ampd Mobile in the US and the East Asian operators. Ampd Mobiles success shows the considerable appetite which youth have for mobile content: an ARPU four times higher than the US/European average and content revenues nearly ten times higher than the US/European average.

Mowser

Tarek writes about Russell Beattie’s new project – Mowser. “Mowser is a combination of services related to the mobile web. Theres a transcoder that will redraw your favourite websites into a mobile-ready version on-the-fly, a list of popular Feeds and a collection of mobile-ready websites…Another feature is the use of keywords. When developing for the Mobile Web its always useful to implement anything that will reduce the amount of text a user has to enter and this is done with preset Keywords in Mowser.”

Nokia 1100 #1 Consumer Electronics Product

The Mobile Technology Weblog points to a Reuters report which says that Nokia has sold 200 million units since 2003.

In the consumer electronic charts, Apple’s iPod reached the 100 million mark last month, Sony’s PlayStation 2 had sold 115 million by end-2006 and Nokia’s earlier top seller, the 3310/3330, sold 126 million units up to its retirement in 2005.

With sales of more than a million phones a week, the 1100’s volumes are comparable to all the phones made by the world’s fifth-largest vendor, LG Electronics, and not far behind Sony Ericsson, the fourth-largest player in the industry.

Relationship Marketing

Stephen Johnston blogs about comments made by Lester Wunderman at the Forrester Marketing Forum:

# We used to be in the business of direct marketing now were in the business of relationship marketing.
# We will eventually move on to personal marketing, which will be facilitated by the use of data.
# Four goals for direct marketing: Relevance, relationship, repurchase, and retention.

Intel’s New Markets

WSJ writes:

[Intel] told analysts that it will develop semiconductors for new varieties of hand-held gadgets, consumer-electronics products and portable computers for emerging economies. Each of the chip markets has total potential revenue of $10 billion a year, estimated Paul Otellini, Intel’s chief executive officer.

Defining characteristics of the new devices include broadband Internet access and low power consumption, Mr. Otellini said during the company’s annual analyst meeting in New York. The gadgets and the chips in them will command lower prices than Intel is accustomed to — requiring improved operating efficiency and advantages of a new manufacturing technology to keep the company’s profit margins up, he said.

TECH TALK: Doing Education Right: Incentives Matter

By Atanu Dey

Alistair Cooke in his weekly radio broadcast on BBC Radio 4, A Letter from America, once explained the theory of public choice to his listeners as the homely but important truth that the politicians are after all just the same as the rest of us. It is an accessible, though incomplete, definition of what public choice is about. You could read James Buchanan, who in 1986 won the The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel (popularly known as the Nobel Prize in Economics) “for his development of the contractual and constitutional bases for the theory of economic and political decision-making. But Cooks version is adequate for our needs to explain why the Indian educational system is a disaster.

Politicians and bureaucrats are motivated by self-interest, and the will to power and control is deeply ingrained in them, perhaps more so than in the average person. Monopoly control of any market or institution is heady power. Controlling the educational sector is gives them an enormously powerful lever for controlling the economy. It is therefore quite understandable that the opposition to relinquishing that power would be formidable. The greatest challenge that India faces in reforming its educational system arises from this, not perhaps so much from a lack of understanding of what needs to be done, or how it is to be done. It is hard to overestimate the power of vested interests amassed against doing what is rational in education.

Here we look into what needs to be done, and leave aside for the moment the question whether it will be done, and if so how it is to be done. What needs to be done can be stated in one word: liberalization. The system is in chains.

In a socialistic economy, the state controls everything with the stated objective to reach the commanding heights of the economy, as the Indian leaders have always loftily boasted of achieving. What actually happens is that the state commands and controls and flies the economy into a very deep ditch. Remember USSR? Its gone. A land lavishly gifted with natural resources and industrious smart people reduced to rubble. We have not fully learnt from their failures of the shackling of their economy. But there is a small possibility that we could learn from the successes of the limited unshackling of our own economy.

It is of course possible for governments to efficiently produce goods and services. The question rather is whether it is probable. The evidence is strong at least in the case of the Indian government that it is highly improbable. The list of government failures is too lengthy to list here. But a few instructive examples which illustrate the general idea are worth considering.

Telecommunications was the governments sole preserve. The waiting times were measured in years, the prices were high, the quality poor. When the private sector was allowed entry, the prices dropped, quality improved, demand soared, supply expanded, and best of all, the public sector incumbents started performing as well. The same story can be told about the air transportation sector.

It is important to stress that the problem is one of government control of the sector, not whether it is served by private firms or not. Even if there are no public firms in a sector, government can control the sector by restricting entry (think license) of firms into the sector, thus limiting competition. The resulting low quantities (think permits and quotas) support high prices therefore high profits. The competition for acquiring licenses is part of the rent-seeking game that is played by the politicians, bureaucrats and private sector firms. It is a nice little game (racket?) where all the players win, and the only losers are the poor consumers and the economy.

Lets look at the education sector against this backdrop.

Write to atanudey at gmail.com if you have questions or comments.

Tomorrow: Markets Work

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