Only the best will win

Is competition good for business? More specifically, is the excessive competition good for telecom businesses in India? On the one hand, customer is truly king at the moment, with aggressive pricing and interesting schemes wooing him. On the other hand, this cut-throat competition is still volume based and not value based.

The truth is that in this overly competitive environment, making profits is tough. And if no money is being made, there is none to invest in ramping up the infrastructure, which is a critical need in Indian telecom at this stage. For instance, the teledensity in rural India is just a little over 30 percent. We are also not using the best infrastructure technologies—most towers base stations are old and therefore more fuel-guzzling, adding to the costs for the company. Telecom infrastructure, therefore, needs a lot of investment—something that none of the telecom companies can spare.

If we miss the bus on infrastructure and innovation, we will get left behind. While India is one of the most exciting markets for telecom companies to be in, their growth here will be a painful process. Some may even be unable to sustain themselves in this volatile market and have to pull down their shutters.

This flux is a natural part of growth and maturity, and a healthy development for the long run. For the short term—it’s a jungle out there and only the mighty will survive.

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Who will reinvent 3G for India?

Aggressive plans propped by even more aggressive promotions—3G has really arrived in India. Or has it? Is 3G the panacea that everyone thought it was? It of course provides more bandwidth, but can it make connectivity ubiquitous? Can it take the Information Age to the remote parts of the country? Can it, even in urban settings, replace the dependence on DSL connections or even the USB wireless connectivity dongles?

The numbers game in India can be a dangerous one. And yet, that’s the game everyone plays, and that’s the game operators are playing with 3G. You may get the numbers, but is there a vision for 3G. If there had been a vision, 3G would have been used to take broadband connectivity to the places in India where even power hasn’t reached. For a long time it could be the only access to internet that would reach them. But the way 3G is in India, it is not designed for such wide-scale adoption.

There is, of course, talk of 4G coming in soon. But what is the guarantee that 4G will address this problem either—it will, in all probability, be the internet of the rich. So for now, we have to think 3G.

For 3G to be effective in anyway, bandwidth efficiency will be critical. The services that get offered should be bespoke to Indian market, not just copies from other markets. Many of the imported services have been created in and for an environment of practically unlimited bandwidth. They are not viable for India at all. We need truly new, unique and efficient solutions.

But I’m not sure anybody is thinking along those lines.

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Hindsight as foresight

The telecommunication & IT industry is in an unprecedented turmoil – you agree? These industries are witnessing bigger structural changes than ever before – you agree again? If you have answered “yes” to both of these then you could join the ever growing group of experts writing about these “events”. Speculation has always been the favourite sports for the idle. I stumble increasingly to opinion pieces, expert analysis, insights, viewpoints and “studies” that are all based firmly on hindsight and loaded with nothing else than speculations of what might be coming. It does not take too much effort to consolidate some known information into speculation and then publish it. Therefore to find truly good analysis, weighted opinion pieces and inspiring foresight is increasingly difficult as it is all buried under a heap of tweeted junk. The value of trusted sources is more valuable than ever before. Tweeted or not.

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Apps need to change their game

There is a lot to be said about apps – they have certainly changed the way we interact with computers and phones. However, there is also a lot to be said about economics. And economics is certainly warped when it comes to apps. The rising number of apps being created is only exceeded by the number of downloads. And yet, how many app developers are actually making money?

Here’s the fun part – according to research by analytics firm Localytics, 26% of the apps downloaded are used only once! So, those humongous number of downloads give only half the story for the success of an app. Because the revenue actually comes with consistent usage and not just number of downloads.

And where does consistent usage come from? Increased engagement. How many apps have that? It is, perhaps, time for apps to be measured for engagement rather than downloads. Another survey done last year—a Harris Interactive study by Effective UI – said that 38% of the users were disappointed with the apps created by their favourite brand, and 69% of the users admitted that a negative perception of a brands app translates into a negative impression of the brand. So unless they get it right, brands could actually be harmed by going for an app than benefited.

In the same survey users stressed heavily on the need for the app to be easy to use, do exactly what they want it to do and that it should be well designed. A good user experience is the key to an apps success and the metrics methodologies should be adjusted to measure these instead of just downloads.

With these adjustments, the picture will completely change. And with this changed picture will emerge a different landscape for brands and mobile advertisers to map.

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Operating themselves into a corner

On the mobile platform – just like everywhere else today – if you don’t move forward but stand still, you fall behind. The other reality is that perception is everything. You are successful if you can create an image of success. And if your image is that of someone grappling with changing realities, even impressive numbers can do little to change that image – just look at Nokia.

Nowhere are these two realities more evident than in the telecom operator space. In a market with less and less differentiation, if bandwidth is the only thing that telecom operations provide, they may soon become like utility providers. The only thing differentiating one from another would be price and even that can go on only for so long.

The fact is operators will have to find a way to stay relevant and to lead the market movements. Right now, they are not seen as the force of the future but as that of the past. They have to go beyond being just mobile bandwidth taps and they will have to offer services that make it irresistible for a subscriber to choose them over their competitors. Like Aircel is doing with Blyk.

The truth is that if you compare the revenues of the telecom operator industry with that of, say, the IT industry, you may find that the former is much higher. But the perception that the IT giants have created is that they can do anything. The same could be said of operators, if they would only believe in their capability and play up their role. And, of course, differentiate their offerings.

Ultimately, to the consumer, it doesn’t matter who is selling what. They have their basic needs—like the need to communicate, the need to interact socially and discover all things new—and whoever steps up to satisfy them, will get their attention and their money. The biggest obstacle operators need to deal with is in their own head – a lack of vision. Unlike Facebook or Google, they are not global players, and they easily let this limit their innovativeness and blur their vision.

For instance, offering Facebook is not differentiation—it is, in fact, just something you can’t do without. But is that all customers want? Surely companies who claim to know their customers inside out should be able to do better, much better.

Silicon Valley creates a great vision of the future but not the revenue to match it, while the operators create great revenue, but no future (and please save me from all the bandwidth and tech futurists!).

For operators to continue to register growths in their business tomorrow, they will first need to serve their customers much, much better than they do today. And after that they will need to sell a dream, and then deliver it.

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Is there a case for integration?

Each one of us is entitled to our own madness, because we have our own method for it. Order imposed by someone else usually provokes us to rebel. We revel in our fragmented existence, putting things into categories only we understand. I find it hilarious then the insistence of some people to make everything ‘seamless’ and ‘integrated’. I can’t imagine how they believe it will work!

Sure, there will be things that are so compelling that people will want constant access to it. But that is credit to those services. For instance, if we people want to access social networking sites, they will seek them on every screen. Because these are things that add value to people’s lives regardless of where they are seen. Integration adds value.

And then there will be things people don’t want to integrate at all. For instance, no matter how much you try, most people will not use the television to make a phone call—even in an emergency! Some devices are best suited for a particular function and completely unsuitable for others.

Of course, there will always be people who want to live in a seamless world where the real, the virtual and the mobile all weave in and out of each other. They will want their car’s air-conditioning to have kicked in 10 minutes before they sit in it. They will want their mobile to switch on the lights of their home the moment it is in range.

But the idea that people will want everything exactly the same way across all platforms of interface is an idea that belongs in science fiction. People’s lives are fragmented and trying to integrate everything is not a smart idea at all.
The truth of the matter is that integration will happen only if it makes sense to the consumer. As people in the industry, we must keep in mind that we will be dictated by the consumer and not vice versa. And it just might happen that we end up with more number of standards instead of less, more consolidated ones. And that’s not necessarily a bad thing.

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Put a ring on it

There is something very attractive and almost edible about apps—especially those on a mobile device. With their nice, rich designs, intuitive interface and interesting features, apps are notching up fans across the world. According to a report compiled by consulting firm Chetan Sharma Consulting commissioned by app store GetJar, app download is likely to shoot up from 7 billion in 2009 to 50 billion in 2012. Does that mean rich media is ready to take over the world? I’m not sure.

While the numbers look attractive, how many of these apps are actually being used? According to several studies published, most apps die a quick death. The few that do taste fame burn out soon after they shoot up. Of course, there are some that might stand the test of time, but it’s early days yet to figure out which ones those might be. But, if mere numbers of downloads is not a true proof of success then what is?

Let’s focus on the popularity of ringtones a bit. Now that’s an ‘app’ that has been around for a while and is still going strong. It shows that some of the best things in life are really simple. There might be the juiciest apps available in the world, but the first thing you do when you get a phone is customise the ringtone to reflect your personality and lifestyle. No wonder then that the humble ringtone is the most popular phone app! No matter what OS your phone is running on, how fancy your handset, the ringtone changing feature remains the same. Who would create a phone without it?

The reason for that is simple—a ringtone is part of you and your personality. It says that even as you look corporate chic, there’s a rockstar lurking within you. Or that you are nothing if not up to date with the latest Bollywood numbers. Or that under that tough exterior lies a God-fearing person. A ringtone is an app that is worthy of some admiration, but it rarely receives it. So even as you buy the latest phone with all the bells and whistles, your ringtone will still be your signature. Everything else comes second.

This could give all of us some inspiration in the mobile industry when creating new apps. Do not be fooled and lured by massive download numbers tallying up to billions. Focus on the frequency of use that your app creates with an individual. That is a number that really counts. After that, everything else will follow.

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Text trumps display ads on mobile

With the fancy new handsets constantly flooding the market, you would think that the snazzier-looking display ads would fare much better than plain ol’ text. The fact, however, is just the opposite.

In mobile there are currently five completely different environments for brands and advertisers available—display ads through mobile web, display ads in applications, mobile search, opt-in messaging ads and everything else (from QR codes to augmented reality). All these achieve massively different results and efficiency and the distribution channels and options are numerous.

According to a recent study by global mobile advertising major Upstream, banner and display ads don’t work for the mobile. The study, which was based on consumer responses, found that most people don’t click on these ads and prefer short, precise text messages instead.

With ABI Research auguring that 2011 will see 7 trillion text messages being sent—SMS is a pretty well-used medium, wouldn’t you say? And yet, the humble text is underestimated as the carrier of advertising messages.
Not by everyone, though. Coca Cola has set text messaging as a top priority for its mobile overtures. As a company looking to spread its messages to as wide an audience as possible, that 7 trillion figure is very convincing. The pervasiveness of the text message, combined with its ability to be used for machine2machine communication (for vending machines), made Coca Cola prefer it over, say, an iPhone app.

So if text messaging is the answer for mobile advertising, shouldn’t all Indians be buying real estate, products, services, and even ways to ward off the Evil Eye? Well, ultimately, it is the message itself that counts. And the way in which it is sent so that it doesn’t intrude, annoy and disrupt. What have given text messages a bad name are unsolicited, non-profiled and intrusive spam texts. Luckily they can become history as the government is closing in on spammers more heavily.

Opted-in messages, however, continue to thrive. Well profiled, contextual and timely delivered, they are producing superior results over all the other formats, regardless how hyped and fancy those new formats have been. And there is a simple good reason for this—text messaging adheres to the natural behavior of mobile consumer. You call me, you text me and when relevant…I will answer.

As we move up the feature ladder with each phone, it is imperative to remember—some of the best things in life are simple. It’s the same for mobile advertising.

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Mobile is digital but all digital is not mobile

The title is not just wordplay. It is a classic misinterpretation played out in the advertising world. What type of an agency is best positioned to become master of mobile advertising? I have not heard a convincing answer to this question so far.

The way the advertising industry in general views mobile advertising is quite basic and far from inspiring. Though the mobile advertising has been “the promise” for several years, many good initiatives have simply died as the coming of mobile advertising has been delayed for too long. Meanwhile, the digital arms of the agencies have developed their skills in the fast-evolving web business. Budgets have exploded in the digital space and the results are very promising.

And then, oh yes, there is this mobile business. But with less than one-tenth of the overall digital budgets and with an at least ten times more complex ecosystem, mobile advertising in many cases does not make financial sense for agencies. Clients, however, want to be on mobile and therefore most of the agencies must master the mobile medium—but can they?

According to MobiThinking Guide to Mobile Agencies (July 2010), the top 10 agencies value mostly under $20 million in revenues, but astonishingly their staff numbers vary from a few employees to nearly 500! Their claimed reach is from nationwide to multi-regional (or even global) and they do everything from messaging to m-commerce. That’s a very diverse bunch of companies doing almost everything in mobile. Can a small market support their diversified efforts or do they say things just in case? You decide.

When will the major agency networks embark on mobile at full throttle, and how? Will it be through their existing digital agencies, stretching to cover the increasingly complex mobile ecosystems? Are they buying small independent players? Or maybe they are trying to create the needed know-how organically though their best creative and media agencies. And the biggest question of all—is there a CEO who is willing to invest in this nascent opportunity with much needed determination without a sufficient advertising spend to justify that investment?

It is no wonder that mobile ends up being a sidekick to digital in all discussions. And yet, nearly everyone admits that mobile will, eventually, be a dominant player. But when the inevitable market growth happens, catching up will be tough.

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Information sharing on the internet is changing our social behavior

It is remarkable how something as seemingly trivial as a Facebook post could be seen to trigger off an entire revolution. And yet, if popular word is to be believed, that’s what happened in Egypt. One day, a woman decided she had had enough of government apathy, inaction and corruption and announced on Facebook that she was going to the Tahrir (Liberation) Square in Cairo to protest. The announcement went viral and the rest is history-in-the-making.

Twitter’s role in the unraveling of this momentous development was no less critical—in mobilizing the masses within Egypt and garnering support for the protestors internationally. This is probably the reason why countries that want to control popular sentiments try to clamp down on social networking sites. Of course, there is a very strong role that traditional media played in this as well. The power of the people harnessed by social media, however, is the new tool in the hands of the people.

The politics of the matter aside, this demonstrates the power of thought when it is articulated on the internet today. It has the power to transcend the obstacles that offline communication faces. It has the power to draw out unfiltered views for public consumption.

The flip side to this power is that people now feel the need to regulate these articulations. Netizens across the world exult in the liberation that the internet brings with the supposed anonymity it offers. They also find it easy to connect directly with their heroes—Hollywood, Bollywood or real life. And why just social networking, with Web 2.0, there has also been increasing professional and other information sharing—in the form of blogs, presentations, websites and other formats. There is a constantly rising part of us on the net. And with mobile connected devices, this is made even easier.

So what is all this information sharing on the internet, especially over social networks, doing to us?
Even as it gives us a platform to vent and often comes out as spontaneous sharing, it is exposing us to an environment where what we say can be seen or read by anyone. So what you intended as a private joke between your friends and you could land you in trouble because it hurt someone’s political, social or even national sensibilities. People have lost jobs because of what they’ve shared on social networking sites. So, even though on the face of it no one’s stopping us from saying what we want, unsaid (or sometimes even said) codes of conduct are emerging.

In the last few years, after the novelty of social networking wore off (though the usage only increased), people have become more cautious about what they say online. They measure their words more carefully.
This is both, a good and a bad thing. On the one hand online conversation will eventually become more mature and on the other hand, it is making us less spontaneous.

The balance lies between paranoia and exhibitionism. Let’s hope we get there soon.

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