Month: January 2012

Given the mobile base of 100 million, the natural question to ask is: what are these users doing? From anecdotal evidence speaking to people, the answer comes down to search, consuming media (songs, videos), and social network use (primarily Facebook). The top sites in India are similar to those elsewhere in the world, if one looks at the data from Opera.

The challenge in this emerging world is that of monetisation.  The only option for content creators is that of advertising. The other option – subscriber pays – has been a non-starter in India for two reasons: the operator revenue shares and closed platforms make it hard for content creators to make money by billing through the operator, and the mobile payments options through the banking network are so regulated and cumbersome to make them almost unusable for small payments.

What is clear, though, is that users are moving from one world of value-added services to another. Ringtones, wallpapers, CRBT and the ilk are being pushed to the background as a new set of services and needs comes to the fore. A next-generation of mobile value-added services awaits us.

Continued tomorrow.

A new world of mobile data is emerging. It is being driven by the rise of better phones, faster networks and an increasing variety of content applications and mobile internet portals. While India is not the first country to experience this new world, it is unique because it is one of the few countries where the mobile is becoming  the primary (and in many cases only) device in people’s lives.

In India today, there are an estimated 100 million people who already use the mobile Internet. This is an extrapolation from the datapoint provided by Vodafone that it has 32 million people using the mobile Internet. Airtel would probably have a similar number, and other operators put together would add an equal number.

The PC internet in India has about 80-100 million users, according to recent surveys and estimates. While there is some overlap between the PC and mobile Internet users, it would be fair to say that the Internet in India now has about 120+ million unique users – about 10% of the population. Going ahead, this user base should rise even faster.

Continued tomorrow.

From a series I wrote a year ago:

Being part of this movement to help transform India is what I propose to do going ahead. We cannot sit by silently and watch the extraction and exploitation continue. It is only when some among us start getting outraged at what we see happening that the wheels will be set in motion. But this has to be done in a planned way. One has to bring the inventiveness and energy of a startup to this process. There is one path to success, and that needs to be figured out.

When we look back at India since the 1930s, it is a tale of missed opportunities. There are many occasions when we could have taken a turn for the better, but poor decisions by our leaders failed us repeatedly. Some were plain stupid, others were motivated. We cannot afford the luxury of time any more. There are too many futures at stake now – our futures.

The good news is that India can be transformed. And we can make this happen during our lifetimes to bequeath to the next generation a country they can genuinely be proud of. As citizens of India, some of us need to step forward to lead this effort.

This week’s links:

• The rise and fall of personal computing: A fascinating graph from asymco.
• Making Customer Segmentation Deliver: from strategy+business. “As the ability to gather sophisticated data grows, here’s a four-step process for making segmentation drive improved performance.”
• Customers, Competition and Cost: A Knowledge@Wharton interview with Sam’s Club CEO Brian Cornell on the Essential ‘Cs’ of Leadership.
• India at 60: by Shankkar Aiyar. “The Republic has failed its people on both justice and equality, on delivering the basic standards of humanity.”
• The Future of Cars: from Technology Review. “Cars are soon going to be the new smart hubs of entertainment and utility.”

Government and Politics: Interference and Opportunity

2011 will be remembered as the year that the government started cracking down and limiting the freedom of speech on the Internet. Perhaps shaken by the success of the India Against Corruption mobilisation via mobile and social media, the government fought back by cracking down on social media, TV channels and SMS. 2012 will see various court battles to determine whether India sees censorship in the China model, as one of the judged hinted.

India’s mobilisation and politics can also be changed via the coming rise in digital users. IAC was a good showcase of what can be possible. Given the large base of urban Middle India and the tools that they have to now organise, there is no reason for this segment to continue to stay apathetic to social and civic issues relevant to the future of the country.

Last Word

So, even as India’s Internet comes of age finally, our government, digital infrastructure  and regulation hold our usage back. I hope that 2012 sees these obstacles go. But given past experience, I am not optimistic. And yet, we as consumers will find our own paths to make the digital world an even greater part of our life.

Marketing: Multiple options

Digital media options are proliferating. Marketers now talk of paid, owned and earned media. Paid media is the search and display ads that companies run. Owned media is the properties that are created – for example, Facebook pages and mobile apps. Earned media is the multiplier effect from users spreading the word on their own through social media and other mechanisms.

There is mobile marketing with all the various options – SMS, voice, mobile Internet and apps. There is also social media. Email marketing is also growing rapidly in India. What is perhaps lacking is more innovation in how all of these options can be better integrated together.  For example, TV advertising could include opt-in options to drive permission marketing to the mobile.

As digital marketing options proliferate and ever greater percentages of the budgets shift, companies will demand even greater accountability of their spends. So, analytics will emerge as a by-product of the process with even sharper targeting of users. There is so much information that we are leaving in trails on the Internet and sharing that the world of microtargeting is now becoming a reality.

Entrepreneurs: Optimism Abounds

The past year has seen at least a few private companies like Flipkart and InMobi with valuations rising to the magical billion-dollar mark. eCommerce companies of all shapes and sizes have been at the receiving end of dollops of dollars. That is good. While there will be many failures, there will be a large array of entrepreneurs who will learn a lot from this process. Multiple models will be tried and morphed, and good always comes out of such experimentation.

A decade ago, there was a similar optimism but that window was too short and the user base was simply not there on the Internet. This time around, it is for real. There is a much better pipeline of funding available for entrepreneurs now – from individuals, angel networks to VCs. All we need to keep this pipeline running is a continuous flow of exists through M&As and IPOs.

What we need in India now is more investments into localised content and services. This will help drive more usage and advertising. The ad spends on the Indian Internet at Rs 1,500 crore annually are still now large enough to sustain a vibrant content ecosystem. Local languages and content will be critical in the next phase of the Indian Internet.

Continued tomorrow.

Mobile Payments: Mired in regulation

One of the big boosters for monetisation on the Internet and eCommerce can come from enabling mobile payments. Here, regulation by RBI and the payout regime from the DoT has ensured that mass-scale mobile payments remain a mirage.

Imagine being able to pay for a book you bought by just having it added it to the phone bill (or being deducted from a prepaid amount). If this process is simplified, then even an SMS sent by a merchant can turn into an actionable transaction with the consumer just smsing a Y to complete the purchase.

To make this happen, while the theory of mobile wallets happens, the process is simply too cumbersome. For sub-thousand rupee payments, we need a simpler process. Operators should have not to pay service tax and revenue share to the government on these charges. They can take a transaction fee (3-10%), and pass on the rest to the merchant.

Unfortunately, 2012 is unlikely to see much change on this front.

Bandwidth: Frozen in time

India’s data pipes scenario doesn’t look that good in the near-term. The wireline networks are almost entirely dependent on a broke BSNL and a meandering MTNL. As a result, we are not seeing the high-speed networks that should have been ubiquitous by now. By not unbundling the local loop (last mile), the government has forced private players to take the wireless route even for the last mile.

Reliance’s impending entry with their 4G networks will change the game. But it will take a couple years for that to happen at a national level. One would have thought that the existing 3G mobile operators would have fast-tracked moves, but that hasn’t happened. So, with BSNL and MTNL not doing much, RIL’s entry still some time away and the 3G networks not living up to their promise, things aren’t changing much.

Bandwidth remains critical because the Indian Internet usage needs to switch from intermittent to always-on, and from low broadband (sub-1 Mpbs) to real broadband (multi-Mbps). Until that happens, the usage will remain somewhat muted. For applications like multi-player gaming to take off, high-speed networks are critical.

Continued tomorrow.

From a post a year ago:

One of my favourite books (and movie series) is “Lord of the Rings.” And so, I can think of no better way to end this series than with three quotes from the movie that I feel epitomise my thinking and life.

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Frodo: I wish the Ring had never come to me. I wish none of this had happened.

Gandalf: So do all who live to see such times, but that is not for them to decide. All we have to decide is what to do with the time that is given to us.

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To bear a ring of power is to be alone.

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Even the smallest person can change the course of the future.

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