Posts filed under 'BSNL'

Mobile Payments dogfight

Recently, we heard that Starbucks – the behemoth in coffee retailing business, invested in Square – the American Mobile Payment startup; as well Starbucks stores will be accepting payments via Square mobile app. Starbucks already had their mobile wallet solution and had seen a record number of transactions via this platform, wherein the customers would just wave the starbuck app barcode on their smarphones in front of a reader in a Starbuck store and the amount gets deducted from the user’s Starbucks mobile wallet.

Now Starbucks is betting on Square – that zingy startup which has attracted tons of VC money from big name investors. Starbucks buyin gives Square the credibility that is needed by the tech firm to sell into big name retail. So far Square app was popular for mobile payments, but primarily limited to thousands of small businesses which had adopted this solution. Starbucks approval puts Square square and centre in the Mobile payment contender space – along with the traditional digital payment firm Paypal. Paypal has been experimenting with Mobile Payments for sometime now and has the backing of millions of consumers and merchants who use Paypal daily for moving around money online.

Paypal, in turn, announced a partnership with Discover Card financial services, Paypal mobile app will mediate a Discover payment in select stores. Discover is the smallest of the 4 big Credit Card vendors in United States. Visa, Mastercard and American Express cards are working on their own mobile payment solutions or partnering with other internet and telco players. Discover is relying on Paypal to carry the smaller card vendor into the Mobile payments vertical (although Discover works in Mobile Payments via telco partnerships as well).

It seems like a dogfight between Square and Paypal has begin to try to dominate this upcoming area. Although there are other heavyweights in the ring – namely, ISIS (telecom carrier joint venture), Google Wallet, Apple potentially, banks and some others. It would be interesting to see what tricks Apple has up it’s sleeve. Apple is a killer firm which, when it enters a market, comes up with such innovations that few are able to compete with it.

The Mobile Payments space is fragmented and there is no clear winner or dominant player yet. The complexity in financial regulation and the difficulty in scaling this business over a large number of merchants has kept this area into the hobby domain so far. As it seems, it seems to be breaking out now with some startups and large firms making aggressive moves to create a market in this now. We watch this space with keen interest.

As far as India goes, there are local startups who have tried to tackle this space – firms like ngpay, paytm, obopay and some others. But most are still small and captive scale is not there yet. Many of these firms have survived in India by doing things other than Mobile payments. Eg Ngpay has become a mobile shopping mall, PayTM has gotten into recharge business and so on.

August 23rd, 2012

Is e-commerce boom already in India? Probably not…

Google, India, Rajan, Anandan, Google India Managing Director Rajan Anandan gave a fascinating talk to a Geeks on a Plane India group this week, giving a snap shot of the data that is driving the consumers, entrepreneurs, trends and investors in the rapidly growing Indian web and mobile markets.

Anandan says: “We’re probably in 1996 in the U.S. in terms of the Internet market in India.” Here’s the stats from Anandan’s deck accompanied with some comments from me in brackets. India has:

  • 1.2 billion people
  • The 9th largest economy in the world, with $1.7 trillion GDP
  • 600 million people below the age of 25
  • 22 languages
  • 250 million in the consuming class — these are the folks that buy e-commerce
  • 900 million mobile accounts, with 600 million unique mobile subscribers (many people have more than one account)
  • 30 million PCs — it’ll be a mobile broadband world
  • Average revenue per user (ARPU) is $3
  • 100 million Internet users, and 120 million Internet users by the end of 2011 that’s about 10% population right now.
  • By 2015 there will be 300 million to 400 million Internet users that would still be about 10% of population then.
  • 37 percent of Internet users access the web from home, 27 percent from an Internet cafe, 22 percent from an office, 3 percent from school
  • There are 50 million mobile data subscribers
  • 5 million access Internet only on the phone but still most of them don”t buy through m-commerce
  • In 2010/2011 e-commerce emerged as a $7 billion market, with $6 billion of that going to online travel
  • By 2015 the e-commerce market is expected to be $40 billion (how will 47 e-commerce companies present in India right now survive until 2015? )
  • 67 percent of e-commerce customers buy electronics and cell phones. 18 percent buy apparel.
  • 15 million 3G mobile subscribers
  • Broadband is 250 kbps to 500 kpbs fixed line
  • The use of smart phones will grow 52 percent CAGR
  • There are 37 million Facebook users
  • Google Plus use is bigger than Twitter use
  • 23 million unique users on YouTube India
  • There will be $1.3 trillion in online ad spend in 2011
  • The English Internet will not scale beyond 200 million, says Anandan
  • 159 million read Hindi newspapers and 31 million read English newspapers
  • There will be a massive tsunami toward vernacular content on the web, says Anandan
  • 70 percent of non-travel e-commerce is “cash on delivery” (no online payments, buyers pay cash when goods are delivered)
  • This cash on delivery market has a 30 percent return rate
  • Web 1.0 and 2.0 are happening at the same time in India, says Anandan.

Some Internet sites that have found success in India:

Considering numbers above, anybody feeling that e-commerce is here and now and they will miss the boat if they don’t enter now can re-think as even if they start 1-2 yrs. down the line, they would be good as internet penetration is still low and more purchase is happening in COD mode than online mode. But, if people feel it would be good to have presence now online so that they are ready when actually penetration rises, then my personal suggestion would be to have enough cash to be able to sustain until then.

For some time, people willing to enter e-commerce have been asking us if they should have wapsite or an app, we have been advising them to have wapsite now and apps soon as in long run leaving either will be a wrong decision.

What do you think about e-commerce state in India? I would love to see your comments…

(via GigaOm)

December 15th, 2011

The Indian Web and Mobile Markets by the numbers

(excerpted from GigaOm Pro article at http://t.co/20B9JVyo)

Katie Fehrenbacher with Gigaom is traveling with Geeks on a Plane in India. She writes following stats provided by Google CEO Rajan Anandan to the Geeks on a Plane group :

Rajan Anandan on Indian internet scene : “We’re probably in 1996 in the U.S. in terms of the Internet market in India.”

Here’s the stats from Anandan’s deck. India has:

  • 1.2 billion people
  • The 9th largest economy in the world, with $1.7 trillion GDP
  • 600 million people below the age of 25
  • 22 languages
  • 250 million in the consuming class — these are the folks that buy e-commerce
  • 900 million mobile accounts, with 600 million unique mobile subscribers (many people have more than one account)
  • 30 million PCs — it’ll be a mobile broadband world
  • Average revenue per user (ARPU) is $3
  • 100 million Internet users, and 120 million Internet users by the end of 2011
  • By 2015 there will be 300 million to 400 million Internet users
  • 37 percent of Internet users access the web from home, 27 percent from an Internet cafe, 22 percent from an office, 3 percent from school
  • There are 50 million mobile data subscribers
  • 5 million access Internet only on the phone
  • In 2010/2011 e-commerce emerged as a $7 billion market, with $6 billion of that going to online travel
  • By 2015 the e-commerce market is expected to be $40 billion
  • 67 percent of e-commerce customers by electronics and cell phones. 18 percent buy apparel.
  • 15 million 3G mobile subscribers
  • Broadband is 250 kbps to 500 kpbs fixed line
  • The use of smart phones will grow 52 percent CAGR
  • There are 37 million Facebook users
  • Google Plus use is bigger than Twitter use
  • 23 million unique users on YouTube India
  • There will be $1.3 trillion in online ad spend in 2011
  • The English Internet will not scale beyond 200 million, says Anandan
  • 159 million read Hindi newspapers and 31 million read English newspapers
  • There will be a massive tsunami toward vernacular content on the web, says Anandan
  • 70 percent of non-travel e-commerce is “cash on delivery” (no online payments, buyers pay cash when goods are delivered)
  • This cash on delivery market has a 30 percent return rate
  • Web 1.0 and 2.0 are happening at the same time in India, says Anandan.

Some Internet sites that have found success in India:

Thanks to Gigaom for the above post.

December 14th, 2011

Mobile Apps Innovation Report, 2011 now launched…

Essential reading for companies, brands, ad agencies, publishers and developers, CellStrat Annual India Mobile Apps Innovation Report is the first of its kind Market Research project in India dealing with the subject of Mobile Apps and Web innovation in so deeply.

Mobile Apps, App Stores, Mobile Web – the new phenomenon in the Mobile world. Apple iPhone and Apple AppStore have unlocked a new Business Model for developers, brands, infrastructure providers and OEMs. Apple’s 350K apps (as of April 2011) and more than 10 billion downloads has brought the App Revolution to the forefront of technology evolution. You want to play a game – there are thousands of app for that, you want to pray to god – countless apps for that too, you want to watch your weight or track your grocery expenses – there are numerous apps for that too. You name it – “There is an App for that”.

Taking Apple’s lead, Google Android, RIM BlackBerry, Nokia Ovi, all other OEM makers as well as many wireless carriers started apps stores. As of this writing, we count more than 100 app stores (yes you got that right, 100) from global vendors and several others in the pipeline. Whether it is Handset makers, Mobile Carriers, VAS providers, Mobile Marketers, all are either producing App Stores or leveraging the App phenomenon in some fashion. Mobile Apps and App Stores have unleashed the potential of the Mobile Web – the new face of The Global Internet.

- How are Mobile Apps doing in India ?

- What is the adoption of Smartphones in India which can run Apps ?

- What platforms are popular in India ?

- What Mobile OSes should you develop for ?

- How do you leverage Mobile Apps for Marketing and Engagement ?

- What is the state of India’s native Apps and App Stores ?

 

To answer these questions and many more, CellStrat brings you the India Mobile Apps Research Project. This research initiative analyzes the Mobile Apps ecosystem in India and has garnered feedback of App efforts by marketers, consumers, brands, technology firms and app developers. This project provides invaluable research insights into the Mobile Apps and their proliferation in the Indian context.

Some of pointers from report for our readers are given below:



Mobile Apps Survey Participation Mix

Mobile Trends

CellStrat Mobile Apps Survey indicates that Android is getting the maximum budget allocation followed by the iPhone. Interestingly iPad is catching up fast on the budget scale and Blackberry does well as well. There is also good interest in Airtel App Central, probably due to the reach and scale of Airtel as a carrier. But, certainly, Android, iPhone and iPad are getting the maximum budgets from firms interested in App development.

Budget Allocation for Mobile Apps Development

 

App Platforms Selection factor weightage

When quizzed about what factors impact the selection of App Platforms, the response was widely distributed with certain factors like wireless carrier support, maturity of business model and presence of App Store being slightly more important than other factors. Interestingly, carrier support was the most important factor when choosing the App Platform. Surely, India is carrier-centric when it comes to App support. Over time, one expects firms like Apple and Google (and probably Nokia and Blackberry) to gain the upper hand in this selection process, tracking global cues on this front.

The CellStrat Annual Mobile Apps Innovation report provides invaluable insight into the Indian Mobile App environment. Indian firms are, so far, only experimenting with App development and using Apps as engagement and media channels. This market still has some ways to go in India. It is ripe for innovation and specifically, India-oriented innovation. In summary, the App market in India is severely under-penetrated and many stand to benefit from the upcoming App proliferation, right from brands, carriers, consumers as well as the developers.

Report is available for purchase. Kindly contact us to place your orders or for any further inquiries.

August 3rd, 2011

Welcome to the Cloud !!

At the Apple’s WWDC event on June 06, 2011, Steve Jobs unveiled the “iCloud” – Apple’s answer to the Cloud Computing fever which sweeps the world. The stock of Salesforce.com – the first B2B SAAS service which houses all your CRM and ERP data in those massive server farms around the world, has gone vertical since its debut. Cloud Computing, SAAS (Software as a Service) and Online Media Lockers are real and happening at a breakneck speed. Amazon and Google released their online music and media lockers to much fanfare and Apple has followed suit with it’s iCloud offering.

Apple iCloud

Businesses have adopted online CRM and ERP applications offered by Salesforce.com, Oracle and Microsoft. Microsoft Office 365 – Microsoft’s online Office suite is a Cloud-based product and is due to be debuted end of June ’11. Business applications and documents find their new home in the Cloud and the transaction models have evolved from licensed software to Subscription services.

The whole idea of Cloud-based Apps and Content envisages universal access from all devices including PCs, phones, tablets etc (TVs to be added in near future). In other words, smartphones and tablets are integral part of the access channel for Cloud services. The front-end in Mobile phones and tablets in such cases are either Apps or Mobile websites, underscoring the relationship of Mobile Apps/Web with the Cloud. Speaking simply, a mobile app may simply be a door to a cloud-based service, product or content.

Such cloud infrastructure, of course, assumes high availability of networks and fast speeds as in case of 3G or 4G services. So far, these issues have not been a major bottleneck in the rise of Cloud Computing.

Cloud Computing in the consumer arena has a profound impact on Media and Content industries. The illustration below depicts these changes.

Impact of the Consumer Cloud

 

June 10th, 2011

Notes from Wireless Technology Forum General Session on “M2M Wireless Devices Everywhere”

(from our Atlanta desk)

The Machine-to-Machine (M2M) market is growing rapidly and impacting all businesses that need to compete in the growing mobile market. This general session focused on the applications that will drive business models and the key elements needed to support this new network paradigm.

The panelists included :

  • Chuck Horne, VP, KORE Telematics
  • Steve Hudson, VP,Omnilink
  • Stewart Swanson, VP, Numerex
  • Joseph Biron, Senior Director, Axeda
  • Keynote and Moderation : Mark Roberts, CMO, Discrete Wireless

It was a very intuitive discussion on M2M or Machine-to-Machine technology which is beginning to take off in the wireless industry. M2M area is also referred to as Connected Devices or Emerging Devices industry. This is one of the hottest Mobile verticals and the next big thing for many telcos around the world. M2M involves embedding wireless chips in a variety of household and industrial devices. These devices could include kitchen appliances, washing machines, security systems, thermostats etc in a home. They could also include mobile use cases like parolee anklets who are criminals released on probation, asset trackers like those used in container or cattle transfers, inventory tracking etc. Wireless chips are also enabling Smart Grids and Smart Meters, defense equipment, automotive uses, health monitoring and hospital use and many other industries. The use of M2M technology is only limited by imagination as almost everything can benefit from wireless connectivity. Wireless carriers are more than happy to evangelize this capability as it offers a potentially new lucrative revenue stream for them and their partners.

Here are the notes from the panel discussion on M2M :

Mark Roberts of Discrete Wireless started with a small Keynote speech. He spoke of Unified communication and the fact that 33% firms use VoIP today. As per Mark, VoIP will see 79% penetration by 2013.

Compare this with the world of Connected Devices. Mmany estimates suggest that, by 2020, there will be 50 billion connected devices. Everything that can be connected will be connected. Chaos will reign!! (great :)

Business Models for existing networking will not work in new world of M2M (how do we charge for 50 billion connected devices – it cannot be transaction based as there will be millions of transactions). (my take on this : It will be flat rate charging per month by carrier for a set of wirelessly-enabled devices with total bandwidth caps. Other model might be where the cost of unlimited wireless connectivity is bundled with the device cost upfront eg Amazon’s Kindle bundles unlimited wireless book downloads with no separate wireless charges (Amazon charges for eBook downloads however).

Chuck : M2M involves three components – network, device and application
Chuck’s firm Kore Telematics provides global network svcs on GSM or CDMA networks.
Chuck mentioned the need to build Value-Added Services to make the M2M model viable.
Eg network mgmt tools, billing svcs, integrate with business svcs

Steve Hudson of Omnilink mentioned that his firm has the electronic monitoring product for tracking parolees and those on probation from jail. Their product allows tracking of criminals – Omnilink has a software platform to support this network. Now Omnilink is getting into asset tracking, amber watch (missing child service) etc. Most certainly, security is a huge application for M2M.

Stewart Swanson of Numerex mentioned that his firm has 1.3 million M2M customers
Numerex is a one stop shop for M2M solns. They integrate device to SIMs and activate or deactivate these devies.  Numerex also has hosting solns in the cloud, packaged solns, telematics as well as professional services business.

Joseph Biron of Axeda mentioned that his firm was in the business of tracking assets. Their customers started asking for wireless tracking few years back. At that point, Axeda developed a platform which allows partners to build M2M apps in the enterprise, carrier or SI environment.

Mark mentioned that Discrete Wireless has a fleet management solution for automotive fleets. Their solution has an engine to aggregate the data.

Steve H : M2M involves a lot of hardware, but hardware needs creativity. It is difficult. Folks interested in M2M should not underestimate the complexity of hardware integration and hence should partner with good vendors who have the hardware expertise.

Stewart : mobile penetration may remain flat (a family of 4 needs 4 phones generally). But m2m will grow by 10 times as all devices will become connected (a family of 4 could have almost 20 devices in their home which are connected) (Good point!).

Chuck : with 50 billion connected devices, pay per subscription per month model will not work. Need to innovate billing models.
Currently, cost to install embedded devices in home equipment is prohibitive. This will eventually come down as such solutions go mass market.

Stewart : standards for M2M applications are still missing. TIA (Telecommunications Industry Association) is trying to set some standards for the M2M industry.

Which verticals are big for M2M ?

Steve H – security and tracking is big (Steve’s firm Omnilink caters to security industry).

Stewart – Carriers are depending on Value-Added Resellers (VARs) to connect consumers with M2M applications and solutions, as well as to find viable business models.

May 27th, 2011

Event Roundup from Mobile Apps Conclave, Bangalore

Mobile Apps Conclave – the conference organized by CellStrat concluded successfully on 29th April, ‘11 at The Chancery Pavilion Hotel, Bangalore. The Conference saw tremendous interest with a large no of audience from all over India. The star-studded speaker lineup and intuitive content on Mobile Apps and Web fueled interest in this event. The theme for this event was : “The Mobile Web Disruption – Life, Media and Business get Appified”.

In addition to Bangalore, audience came from cities like Delhi, Mumbai, Hyderabad, Kolkata, Ahmedabad and Chennai, both from brands and senior management of companies as well as the developer community.

More than 200 blue-chip audience participated in this event on the hottest topic in modern times – Mobile Apps, App Stores and the Mobile Internet. Most brands, mobile device manufacturers, app store and app development firms were present to learn about the Business of Mobile Apps and Web.

Details of the event and photographs are available at http://www.mobileappsconclave.com.

Event Brief :
The Mobile Web – the new name of Growth around the world. Mobile Internet Tsunami – as many refer to it.

Mobile is the industry of this decade. Mobile has taken world by storm. The feature phone growth is fast evolving into smartphone growth driven by the emergence and popularity of The Mobile Web and those tiny ubiquitous Apps – hundreds of thousands of them literally. Mobile Web is upending so many industries, it is breathtaking to say the least. Many of these businesses are succumbing to the trend which the venerable firm Apple started – businesses like news and media, advertising, gaming, productivity, publishing, telecom, entertainment, commerce, financial services or healthcare..the list goes on and on. Whoever you are, wherever you are – either have an App and Mobile Media strategy or be prepared to loose substantial traction in the marketplace – because, indeed, your customers are App savvy even if you are not.

You are on the road and want to check nearby promotions, there are many apps for that; you want to track your supply chain, many apps for that too; track Social Network updates; many apps there as well; there is even an app for Confessing to God. Apps are orchestrating the growth in intelligent smartphones; next playground is Tablet followed by Computers. Are you ready for the brave New World of Mobile and Mobile Tablets ? Are you ready for the Mobile Web revolution ?

Conference Sessions :
Here are some notes from the Keynotes and Panels that transpired at this event.

In the morning session, there was an intuitive keynote by Pratapa Bernard, Vice President and Head – COE – Data Services (Emerging Markets) at Vodafone. He addressed the impact of the Mobile Web and Apps on the modern consumer and businesses. He mentioned the imperative need to focus on user experience and not technology itself citing the example of Apple etc. He went on to say that 80% of internet access in India in 2015 will be from mobile devices.

Next came a panel on “Mobile Apps go mainstream – Content, Engagement and Lifestyle on Mobile Apps”. This panel discussed the Mobile App revolution and how Content and Entertainment is being delivered via Apps. The panel speakers included Rajiv Kumar (CEO – RockeTalk), Deepak Swamy (Head – Flypp App Store, Infosys), Sanjay Bhasin (VP-Getit Info Services), Vikram Tanna (VP – STAR Digital), Rajesh Reddy (CEO, July Systems) and Narasimha Suresh (CEO – TELiBrahma). This panel focussed on App monetization and how developers are finding it a challenge to monetize their apps. This panel also discussed the need to “Indianize” the Western business models, cost structures as well as offerings to make them work in India. On HTML5, the panel members said this new standard will be big against Mobile apps but the “when” is not clear yet.

After the first panel, there was an interesting keynote by InMobi (top Mobile Advertising firm) executive Sridhar Ranganathan (VP-Product Management) on how market pressures are forcing firms like InMobi to push the boundaries of creativity with immersive advertising and the need to think of Mobile Ads like mini-apps. He mentioned the need to un-learn the PC and focus on Mobile as a separate experience.

In the afternoon session, there was an innovative keynote by Sunny Rao, MD – India and APAC of Nuance Communications. Sunny spoke about some of the innovations in Mobile Web world surrounding Speech Technology, Voice-based Social Networking and automotive vehicles as mobile channels. Sunny’s keynote was followed by an interesting panel on innovations in Mobile Apps and Mobile Web. This panel had some true Mobile innovators in Amiya Pathak of ZipDial, Kalyan Manyam of MojoStreet, Indus Khaitan of Bitzer Mobile and Soumitra Sharma of IDG Ventures. This panel discussed specialized vertical Apps which are popping up in industries like Payments and Commerce, Social Gaming, Healthcare and Education.

The Mobile Innovations panel was followed by a Startup showcase where Sriram Mohan, Associate Editor at YourStory.in helped introduce some startups which are creating innovative business models in the Mobile App ecosystem.

The last (but not the least) panel was on Emerging Devices and Tablets. Advent of Apple iPad has opened a whole new world of possibilities and truly heralds a world of post-PC era. Prabha Aithal, CTO at CanvasM moderated a panel of speakers which included Alap Ghosh of Mobango (App Store), Pradeep Rao of Research in Motion, Ashish Gupta of Helion Ventures and Dr Sharad Jaiswal of Alcatel-Lucent Bell Labs. This panel discussed the impact that the tablet and emerging devices are having on the ecosystem. Emerging Devices is a hot new area and is seeing digitization of content at a blistering pace from a variety of industry verticals like publishing, entertainment, retail, media etc..

Conference Partners :
Overall, it was an action-packed conference with active participation from speakers and audience. Partners included Presentation Sharing Partner authorSTREAM on which the presentations by CellStrat, event speakers, exhibitors and partners can be found. The Mobile App Partner, Hazel Media provided an event app for this conference. Whereas the Mobility Partner, MobiVite published a Mobile WAP site for the same.

InMobi was the Platinum Sponsor for this event. AgileCO was the Gold Sponsor. Other supporters included partners like MOMO Bangalore, The Morpheus and Indian Angel Network (IAN). Media Partners include the online media firm YourStory.in and TelecomLead.

YourStory.in was a Premium Partner for this event and it provided online media visibility as well as Anchor support for the event.

Mobile Solutions Expo :
This conference also saw an interesting exhibition on Mobile Solutions where some innovative app companies exhibited their apps and solutions. This Expo dazzled the audience with some interesting apps and solutions in the Mobile space. The exhibitors included WINIT, Nanostuffs, RockeTalk, Bitstream, Softtrends, MobiVite and some others.

For photos and other details from the event, check the event website at : http://www.mobileappsconclave.com.

Shyam Kamadolli (Director – Fidelity Growth Partners India) was one of the attendees and has some intuitive notes from this conference on his blog : http://skamadolli.wordpress.com/2011/04/29/india-mobile-apps/.

May 16th, 2011

TV Everywhere – access Video and Movies on the go

I recently attended a TV Everywhere session where there was a discussion on the evolution of the Television and Video industry with the advent of IPTV and Mobile access devices.

Clearly, TV Everywhere is a a huge trend and there are many factors driving this trend :

  • Broadband

Today one sees DSL and Cable Modems have replaced the erstwhile Dial-ups. The 312 KBPS+ bandwidth running upto 50 MBPS for high end Cable modems in advanced economies (speeds in India top out at 1.5 to 3 MBPS etc for most providers) is enabling the ability to access high-speed graphics, video and gaming content from home and work computers.

Firms like Netflix in the US and Canada have figured out compelling business models to stream movies over the internet and are threatning the traditional movie rental business and regular cable television.

India’s broadband penetration rate is woefully small and speeds are still on low end of the spectrum, so Live TV Streaming in India is still a very niche industry. However with the expected surge in internet penetration expected over the next decade (some estimates put India’s internet penetration at 30% households in next few years), the IPTV and online TV streaming is expected to surge. Firms like seventymm.com which have led the online DVD rental business in India (India’s Netflix) will likely evolve into movie streaming firms as India’s broadband penetration takes hold, similar to what Netflix has done in the United States.

  • Mobile Connectivity

Broadband sticks and Laptop connect cards (offered by most carriers) enable the laptops and tablets to be wirelessly connected over a reasonably fast GPRS/UMTS/3G network – with the advent of 3G in India, this pattern is sure to accelerate.

Consumers today are demanding YouTube and Cricket streaming video from their laptops, smartphones and tablets. Content providers and distributors have to oblige if they hope to keep these consumers engaged and commercially viable.

For India, Mobile is specially important as it has close to 800 million Mobile Subscribers already. Granted that more than 90% of these are carrying feature phones and using the 2G/2.5G networks, smartphone penetration rate is accelerating and wireless tablets are being introduced as well by a variety of handset firms. Between the smartphones, tablets and 3G, one is looking at increasing Mobile Video and TV access over the airwaves in the coming years.

  • Consumer behaviour

As mentioned above, Consumer is the King. With proliferation of devices around the home and on the go, plus busy urban lifestyles, consumers are demanding DVR recording capabilities as well as anywhere, anytime access to their favorite programs. A common trend in many households, which have acquired the new tablets like iPad, is that as soon as the first tablet arrives, members of the household including parents and kids make a grab for it and want to curl up in the bed with their favorite channels on YouTube, Netflix or other streaming services.

TV Everywhere is a developing trend and is being demanded by the consumer. Entertainment and Media industry are happy to oblige – to drive new revenue growth and keep the customers engaged with the brands.

What are the prominent TV and Video Streaming services in India :

  • CNN-IBN Live : TV Portal as well as Live TV
  • NDTV 24×7 : TV Portal as well as Live TV
  • In.com : Has a Video Social Network (not live streaming generally)
  • CNBC TV18 / moneycontrol.com : Business news streaming
  • ESPNStar.com : Video Portal (not live streaming) – has lot of Cricket coverage for World Cup and IPL
  • YouTube / Indiatimes.com : streaming ICC World Cup as well as IPL cricket matches
  • Nautanki.tv : currently it’s website is not accessible (so not clear on it’s status)

April 16th, 2011

“Year of the Tablet” – notes from Wireless Technology Forum (Atlanta) session on Tablets

(from our Atlanta desk)

It is commonly said that this is the “Year of the Tablet“. Certainly, with Apple iPad, Samsung Galaxy Tab, Motorola Xoom and dozens of other tablets and eReaders being introduced in the marketplace, everybody is talking about the “post-PC” era and the impact of tablets on consumers and businesses. Tablets are causing upheavals in the Publishing and Media industries with most major Newspapers and Magazines plotting a Tablet strategy for their periodicals. Netflix and other Streaming Entertainment providers are booming due to the surge in Tablet access subscriptions. Book Publishers are digitizing their books at an increasingly rapid pace expecting a shift away from Printed Books to Tablet or eReaders. 80% of Fortune 100 companies in the United States are trialing iPad for their Corporate employees. Laptops which were hyper-growth computers for the first decade of this century are making way for the Invasion of the Tablets.

Our analyst in Atlanta attended an intuitive session on Tablet computing at the Wireless Technology Forum, Atlanta on March 17th, 2011. Here are the notes from this session :

Speakers :

Mike Lupo, Sr Director - Digital Products, The Atlanta Journal-Constitution (AJC)
Karen Truitt, Director - Mobile Devices, Intel
Chuck Rainbow, Technical Manager – Tablets, Research in Motion
Jim Dudenhoefer, Manager – WebOS, HP Palm
Moderator : Dr. Phil Hendrix, Director, Institute of Mobile Markets Research (IMMR), Atlanta

 

A great cast of speakers from top contenders in the Tablet space (the 800-Pound Gorilla, ie Apple, was missing, so was Google). This session focused on the tablet form factor, the applications that will drive adoption and the business models needed to support this new networking paradigm.

(All data below refers to USA Tablet Market)

Dr Phil : Tablets have almost 5 to 7% penetration right now – it is currently one of the fastest growing Consumer Electronics products.

IMMR (Dr Phil’s organization) recently concluded a survey on the Tablet ecosystem. On the question of “Familiarity with Tablets”, here are the stats :

  • On the question of “Familiarity with Tablets” :- 38% audience – somewhat familiar; 26% – very familiar; 35% – not familiar
  • Smartphone familiarity is higher than feature phones in households.
  • 4 in 10 people are interested in purchasing a tablet for someone in the household. Once the tablet comes into the household, it tends to get shared. Over time, some households may become multi-tablet households.
  • Lower prices will unlock demand. $500 is the breaking point for most folks when they get discouraged from spending on tablets. iPad is at a higher price point but has still sold like hotcake – this is due to Early adopters, who are buying high end tablets today. But significant opportunity exists for cheaper tablets below the $500 threshold.
  • Preferred Tablet OS :- Apple iOS – 58%, Windows OS – 36%, Android OS – 35%, BlackBerry – 13%, HP Palm – 9%. Interestingly, Windows OS beat out Android slightly.

Mike (AJC) : AJC Newspaper has just developed its iPad App and it is currently in Beta. AJC also has an iPhone/iOS App called AJC Digest which is available on App Store today.

Karen – Intel, which is a strong leader in the PC microprocessor industry so far, is looking to expand into tablet microprocessors, chips inside cars, etc.

Jim – HP had acquired Palm recently and HP plans to deploy the Palm WebOS in many of its tablet devices over the years.

Chuck - RIM is about to release its Tablet play titled “Playbook”. There is much excitement within RIM with this upcoming launch.

Dr Phil - Why now for tablets ?

Karen - Apple has created the game-changing device in iPad. Apple is a master of simple products that work well. They made the Mobile Device, App and App Delivery ecosystem simple enough to allow for a mass market adoption.

Chuck – Tablets are now because chip processing and battery power has reached a point where these devices are possible (our take on this : RIM won’t admit to Apple’s role in opening this market :) . These devices are now feasible. We are reaching an inflection point where tablets can substitute for laptops, devices which are anyway more difficult to lug around. People are not getting acclimatized to these devices.

Jim- Consumers today demand anywhere access to content and data. Tablets are just another end point in this evolution. It’s about data access – moving it to the cloud and the desire to access it from anywhere. Phone screen is too small to allow an optimal experience for this. Jim also noted that they are not concerned about Apple’s dominance so far. Jim has a great point of view that, if at all, Apple has been a positive contributor in creating a huge new market for all device makers to play in. Jim said market is huge for many to thrive. This is a market where all boats can and will rise. (Good point)

Mike - In an average American home, people think of tablets as lean back experience whereas PC is work – so tablets make sense now for AJC. Newspaper is about relaxing and consuming the news. So it makes sense for AJC to work in tablet space.

Dr Phil – The 800-pound gorilla (Apple-who else) is not in this session. Where is the gap in Apple’s tablet strategy which others could potentially exploit ?

Karen- Apple has created the benchmark. Everybody else is trying to catch up to that. Android Honeycomb from Google is an attempt to catch up to the iPad benchmark. However the user experience of Android still has to mature for it to be a strong contender. AS to Apple’s weak points, Flash is certainly one – a blatant omission from the likes of Apple. (Karen admitted, however, that Apple does not consider lack of Flash in iOS devices as a weak point).

Chuck- Apple is weak on security. There is a security breach every 4 hours in Apple iOS environment. RIM / BlackBerry is known for security (note that BlackBerry is still dominant smartphone in the Corporate world). Mobile Device security is critical area – virus maker McAfee has smartphone security software today. Apple does even acknowledge the security issue in its iOS environment. Chuck said that until something goes wrong, people don’t take notice. Consumers will start getting concerned when they loose credit cards etc in Apple environment (CellStrat note : Note that Mobile Payments is about to become a big area and here security is of paramount importance).

Jim - Apple is consumer-focused firm. There is lot of opportunity in Enterprise and niche verticals (where the field is still open for all) in addition to the huge consumer opportunity.

Dr Phil : Avg selling price in 18 months?

Mike – 350 or 300 dollar will be great.

Dr Phil - Newspaper in Canada is giving away iPads if folks buy newspaper subscriptions. Will Atlanta Journal Constitution adopt this approach ?

Mike (with a chuckle) – No (resoundingly!)

Karen - Intel has created  tablets for healthcare verticals. Businesses will want ruggedized versions of tablets (a delicate iPad device will not work in many industries) – these devices may get dropped and used in rough conditions in various industries.

Dr Phil - Amazon (Kindle) and Barnes & Nobile (Nook) eReaders will have more and more of tablet functions over time as the boundaries between eReaders and tablets will become indistinguishable. Printed Books may become redundant. Tablets will take over though it will take some time.

Q/A :

Ques : Will HTML5 replace Flash?

Dr Phil - Depends on how quickly content makers adapt.

Ques : Where is the money?

Karen – Apple is making money and also App developers. Carriers are making money also because of rapid growth in Data plans.

Jim- Dynamics of the industry is changing. It is still wide open to pin down the business model. Revenue Models are evolving still.

Chuck- When the PC came around, money was in hardware sales. Then, software became more important and apps like Microsoft Office made money. A similar ecosystem will evolve in Mobile Devices (implying mobile device hardware will make money followed by software over longer term).

Ques : What about accessories business ? The new Apple Smart Covers for iPad 2′s is all about margins (for Apple). Will USB attachments and such accessories be a lucrative area ?

Chuck - Ultimately Bluetooth will be dominant. Apple model of side-loading will be replaced by Cloud services. (Chuck said that in spite of this, Blackberry Playbook will have USB and HDMI port to cover all bases).

Ques : HP Palm strategy to win over developers given Apple’s popularity in Developer ecosystem (50,000 Apps already available customized to Apple iPad and HP Palm has hardly any, so far) ? After all Developers make or break Mobile platforms. Also, Apple deducts a large chuck (30%) from Developer App revenue as commission.

Jim - HP talked to a lot of developers and they are struggling on revenue generation with the Apple App Store or even the Android Store. Certainly there is room for developer innovation here in terms of Business model which helps them.
HP’s strategy will be to be as open as possible (Open Mobile environment) – ultimately this will help Developers. Eg Kindle Book Store will be available on HP Palm – this means that HP Palm Tablet will have 800,000 Kindle Books available from the get go. Also, HP will offer both models in its App ecosystem - the App store approach for mass market as well as Private distribution for corporations.

Chuck – Even though Apple iPad has 50,000 custom Apps, most are trivial (he referenced iFart apps on Apple Store:). Average Usage per app among the 50K apps (on iPad App Store) is less than one day. RIM / Blackberry has much higher average usage of its mobile apps. (our take : Good point but can one discount the mass Developer and Consumer Crowd running after Apple ?)

Ques : On Tablets replacing PCs ?

Karen - Tablet is a consumption device. It will do well but won’t replace PCs/laptops. PCs will always be ahead in graphics and processing power.  So tablet will not replace PCs/laptops that fast (our take: they better not – else Intel’s primary business is in jeopardy :)  

Overall a great session on Tablets. Kudos to the folks at Wireless Technology Forum (Bob, Steve, Maury, Scott, John, Ed and others) for organizing this event.

March 18th, 2011

Does Mobile Web fit your Integrated Media Strategy ?

Mobile Apps and Web have taken the world by storm. Certainly, Apple deserves credit for orchestrating the Mobile Web experience when it created the iPhone and its App Store. In the process, Apple unleashed the creative energy of hundreds of thousands of Mobile developers worldwide. As of last count, Apple App Store counts 350,000 Apps in the store. With the launch of the iPad tablet, Apple popularized the Tablet computer category and now lot of developers are developing Apps for the Tablet version. Tablet has started what most refer to as the post-PC era. Certainly firms like Microsoft, HP and Intel are in lot of trouble as many consumers and businesses are going the Tablet way instead of upgrading or buying regular PCs and laptops. Now Apple is trying to bring the App experience with its launch of the MAC App Store.

Mobile Web is the latest and greatest Media channel today. It is a most apt media channel for a variety of reasons which we will explain a little later in this post.

Are the various Media firms and Brand Marketers prepared to adjust to this titanic shift of Mobile-based Media ? Do Mobile Apps and Web even belong in a firm’s Integrated Media portfolio ? We will attempt to answer these questions below.

Today media consists of various channels :

Media Channels

 How does Mobile Web fit in this scheme ? The schematic below elaborates the various Digital and Mobile Advertising formats :

Digital Media Channels 

 Consider this (taking Indian context here) :

  • There are 770 million Mobile Subscriptions today (out of a total population of 1.2 billion people) – granted only 550 million are Active Mobile Subscribers : still almost 45% of Indian population are active Mobile Subscribers
  • India has less than 10% internet penetration
  • Mobile is the first and only communications tool for most Rural and Semi-Urban Audience in India
  • Mobile is personal, has context, is location-aware and is always ON
  • Admittedly 90% of Indian mobile market is comprised of feature phones, leading to SMS as the dominant marketing channel in India. But the fastest growth rate is now seen in Smartphone uptake – with acceleration in sales of cheaper smartphones from the likes of MicroMax, Lava etc in addition to established Brands like Nokia, Samsung etc. Mobile Web is now proliferating throughout the Indian consumer class much more rapidly than the feature phone growth.
  • The 3G launches this year will only accelerate the move to Broadband Mobile Services (think Mobile Web with much superior user experience and faster speeds)
  • The post-PC era may have started with Tablets taking over the role of laptops and computers. Many leading businesses and business execs are using tablets for business travel instead of their laptops now.
  • Print Media and Book Publishers are rapidly shifting en masse to Mobile Apps and Mobile eReaders as the delivery channel.
  • People are increasingly consuming media, content and advertising on Mobile phones and tablets.

Given the above advantages – Mobile can be a top Media and Marketing Channel for any Agency or Marketer today in India, much better than the Internet at least.

Now how many Brands and Media Agencies in India have actually integrated Mobile in their portfolio ? Our research indicates that most Media Agencies and Brands in India are yet to include Mobile as a captive Media channel (more on this in our upcoming Research Report : “Mobile Apps Innovation Report for India“. Contact us for details). Though many firms have tried the SMS and VAS marketing route in India, the future now lies in capturing the Mobile Web and Mobile App Media market which is developing rapidly in India.

Our upcoming conference on Mobile Apps (April 29th) – the “Mobile Apps Conclave - Bangalore” will address the entire gamut of topics on Mobile Web and Mobile Apps. Do not forget to register – there are some early registration promotions going on right now.

March 7th, 2011

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