Operator Dumb Pipe Syndrome

In the war of convergence, the eco-system is expected to favour the species which collaborates and coordinates the most with other stakeholders out there. So being "OPEN" is "IN"! Open Source and Crowd Sourcing are the new buzzwords of the new era. The case in point is the spawning of Application stores after Apple has successfully used it as SaaS differentiator versus other players in the smartphone space. The other case in point is the coming of age of crowd sourced platforms such as Digg and Twitter. Even while Convergence of Internet and mobile services is a event in process, the technology frontier has now moved to Cloud computing (instead of desktop computing and legacy systems.)

The cloud eco-system, is effectively using the following as service based business models.

IaaS: Infrastructure as a Service

PaaS: Platform as a Service

Saas: Software as a Service.

Refer to the slide below for a snap shot of the service models that are being hosted by the cloud.

I shall not be probing into the depths of each of these cloud hosted services. Instead, we will try to draw the Telecom industry equivalent of Cloud Services --> Lets call this Telco 2.0 eco system (and services).

In as far as IaaS is concerned, Telco's are sharing the infrastructure and keeping the costs under control.  This gives them the ability to focus their efforts in building greater foot prints, bigger advertising budgets and larger promotions (which on the other hand is commoditizing the core product.) Also IaaS means the SME network and voice solutions being provided. The central idea in here is that money made through the IaaS route is not being used for any significant innovation efforts.

As far as SaaS and PaaS is concerned, Telco's have little and no control on this aspect of the eco system. The control rests either with the internet/web 2.0 pioneers -->Google, Yahoo, FaceBook, Twitter etc or lies with the OS system holder --> Nokia, Apple, Google, Palm, Microsoft, RIM etc. The operator makes money through the usage and just that. It exercises no control over Content, Consumer or the Device. (For Telco Carriers (At&T, Sprint , Verizon etc) there is a point here, since they have the choice of devices on their network. Hence there is some amount of co-creation.) However there are ominous signs that the iPhone style model is winning, i.e. Telco's are being used as a transaction point in the retail channel but all the real value is ending up outside the Telco eco-system. A recent release by AT&T and Canadian Rogers have indicated increase of data usage on their networks through the introduction of iPhone and a subsequent increase in data ARPU. However, the iPhone cost subsidy doesnot allow higher usage of data translate into direct profits for these carriers.

Tabulated below is AT&T and Rogers numbers for the year 2008.

With voice moving towards zero tarriffs (VoiP: Skype and Google Voice anyone?) and mobile broadband commoditizing fast, the margins of the operators who have been the lords of the Telecom eco-system is under huge pressure. Thus the operator is at a threat of being used simply to transfer bytes to and from the customer’s device and not being able to increase their position or add any additional services beyond simple network operations. Thats the dumb pipe. (The term basically stems from the internet where ISPs managed to botch their position and now provide nothing but connection and bandwidth.). Operators can increase charges and higher percentages in the revenue generated by the content providers for using the operator pipeline. However, this is unsustainable because it results in high prices for end users, and consumers being deterred from accessing mobile content on a wider scale.

Endnote: With services getting polarized towards content providers and OS makers and device manufacturers, the Operators will need to differentiate thier offerings and must innovate on their services to maintain their relevance in the Telecom eco-system.

A report by Juniper Research, examines the three main scenarios facing the operators and the sector as a whole – the 'dumb pipe', 'smart pipe' and 'on-portal' routes. One single scenario will not win out, since different business and revenue models have to co-exist in the mobile content market.Players will adopt multiple approaches that best fit their markets. Crucially, if MNOs are to benefit financially, they need to move away from their dumb pipe roots to the smart pipe model, though they will clash with the content providers which already dominate the smart pipe.

The report predicts that under the smart pipe model, MNOs will not see their share of the overall mobile content market rise appreciably, but revenue will rise in value by 125 per cent over the 2008 to 2013 period.Meanwhile under the on-portal scenario, content providers will see their share of the market rise from 54 per cent in 2008 to 68 per cent by 2013, providing they can secure more attractive terms from MNOs.The report also concludes that various players can find a compromise and concludes that if MNOs can change their focus from the traditional average revenue-per-user mindset, to instead concentrating on value creation and support for their partners, they can swiftly make the change to a more beneficial scenario for everyone. In effect, it advocates moving away from the existing mindset to a more collaborative view of the eco-system. 

References:

http://www.economist.com/business/displayStory.cfm?story_id=13234973&source=hptextfeature

http://www.vnunet.com/vnunet/news/2231346/mobile-operators-danger

http://social.telematicsupdate.com/content/have-mobile-operators-become-‘dumb-pipes’

mobile analyst firm Juniper Research's recent Mobile Content Strategies & Business Models: Scenarios & Forecasts 2008-2013 report

"Twitter"ing away (part III)

Twitter has taken the lead from Digg in as far as micro-blogging and crowd sourced news and networking content is concerned. Interestingly, users of Digg and Twitter save the view that Twitter scores over Digg in terms of user control i.e the user controls his "following" list and is therefore able to screen the content in the way he likes. Thus the elements of social networking are more relevant in Twitter. Digg however is crowd sourcing to the core and is an open platform to voice views, opinions,suggestions etc. The user cannot regulate the flow of information and the source of the information. Thus Twitter is also relevant as apowerful relation marketing tool. (at the cost of loosing out on a pure crowd sourcing platform)

However the popularity of Twitter is based in a fact deeper than the celebrity usages and formidable following (of Techno Blogger, News and Broadcasting Corporations and Social networkers). As a social platform, Twitter is unique in terms of its API (application programming interface), which allows its access from variety of platforms. As stated earlier, Twitter is accessed from computers and the web only in 56% of the cases. Its API gives it the versatility to be accessed from IM platforms, Twhirl: its desktop client, TXT: the SMS based medium, Twitterific: its iPhone based interface and a whole host of other platforms.

Clever Read Write Web research estimates of the traffic source to twitter

Thus it is Twitter's applications from their API that is making them grow rapidly. This enhances the ability of the user to  "tweet" from anywhere by simply using the mobile phone as the medium. By using the power of mobile phones, Twitter is integrating the user who may not be instantly connected to the internet to connect to twitter. There lies Twitter's biggest strenght. Not that this strenght will not be replicable, but the first use of this medium has propelled Twitter to this position. Its user base has gone up by a multiple of 8 and is increase 60% MOM even as i write this blog.

Ironically however, the API which is so versatile in terms of access is and may not be the most stable for third party application hosting if it comes to monetizing the user base.There in,Twitter has a huge challenge of converting its API into a serious platform if it is to grow into a mainstream application.

"Twitter"ing away (Part II)

On January 17th,2009, Twitter beat Digg as the most popular pastime for people who like to update their thoughts and activities and voyeurs who enjoyed reading about people's lives. The surge in volumes came when the crash of US airways flight 1549 was tweeted by Janis Krums. Krum became a celebrity, Tweeter a phenomenon and the site visit hits one of the largest for any events around the world. It also peaked during President Obama's swearing in on January 20th, 2009. Not only is it now associated with micro blogging but there are strong refernces to its use as a tool for citizen journalism and the emergence of crowdsourcing news and updates.

http://www.techdigest.tv/2009/01/digg_this_micro.html

The increase in Twitter's base of followers/users/Tweeters has gained maximum audience from the 25-34 group. The Numbers in other age brackets have also seen huge numerical increases, though the percentage contributions have definitely tilted towards the younger lot. See the chart below.

Twitter's age distribution pattern in heavy towards the 25-34 age group. For Digg, it is mostly uniform across the age bands.

Also relevant are the clickstream data according to which, Digg relies heavily on Search sites such as Google for traffic. (The absolute number of Searches for Twitter is still higher than Digg). On the other hand Twitter recieves higher share of traffic from social networks. This is mostly due sto the applications which integrate these sites. For instance, Twitter application has 104,000 users on Facebook, where status updates can be linked to Twitter!

One dampener to these statistics is the fact that Twitter's traffic is routed through a variety of sources. In fact 44% of its traffic are from sources which are not web based. This includes the text message, Instant message, RSS and Twitterific applications. A significant amount of Twitter activity takes place through mobile phones, which is not measured and which could impact the Twitter statistics in a northward fashion. So the web based numbers actually tell a part of the story, the whole of which can only be guessimated by the buzz around Twitter during the Barack Obama's Presidential Campaigns and Swearing in.

VAS: Increasing Penetration and Revenue

Covering a Linked in Discussion, on Increasing penetration and revenue of VAS services in India.

http://www.linkedin.com/answers/product-management/positioning/PRM_PST/437353-22685324?browseIdx=57&sik=1237453659425&goback=.ach_PRM.abq_6_1237453659425_n_o_PRM

How to Increase penetrations and Revenue for various VAS services?

Given the present scenario, getting a bigger wallet share for VAS services from the consumer seems to be the biggest hurdle? How can the consumer be incited to use various new VAS services that come up? Is tariff discounting or offering Free Try n Buy the only way to let the consumer have a feel of the service?? 

Hi Anoop 

Your Q seems to have generated a healthy round of discussion and here is my take adding to the muddle 

I come from a Marketing related view guided by two basic tenets 

1. Supply and Demand 

Music, H/Bollywood, Games, Ringtones, Singtones, Cricket is what most of the VAS revenue is based up on (Currently). There is a healthy demand for this but supply is manifold leading to commoditization. Hence the need for innovation in VAS! (Think Medicine, Think Train Ticketing/ Think Fitness/ keep thinking..) 

2. The Age old Construct of the 4Ps. 
We have a Product/Service and currently we are trying to push mass usage through Tariff discounting (Pricing Strategy). A few Opinions beforehand have already mentioned Retail Push (Place) and Cross Selling/Up selling and Consumer Education(Promotions). Even more, we have spoken about Profile and Behavioural based Targetting (a very high order mechanism) 

My take on the VAS markets in India : 

1. We need more stakeholders in the ecosystem. Currently it is only the VAS provider and the Operator. Hence the scope in VAS development and deployment remains limited. 

2. The Indian Consumer is averse to Credit Card and Mobile Payments. I am not surprised about VAS ARPU of Rs.25 (as cited by Rahul). 

3. We are limited in content.Games + Music + Entertainment form 36% of VAS applications in US. The next 36% is Books, Utilities, Education, Lifestyle, Productivity, Travel, Fitness, Sports etc. Social Networking as VAS content has also been less exploited. 

Point 1,2,3 (More Stakeholders, Wider content, Paying Mechanisms) lead me to the end of my argument, which i will elucidate with an example: 

How about partnering with VLCC for beauty tips, reserving apointments, reminders etc etc? 
How about partnering with Apollo hospitals to provide a range of services on a VAS platform? 
Tie ups with Local Gyms to disburse mobile services to its members? 
Taxi services and Train/Flight Booking via VAS.... 
The possibilities are endless if you take the unconventional route to VAS and application monetization.The business model would be a win win win design for the consumer - Telco + VAS - Solution provider. 

Would consumers pay? They already do... and a minor addition in terms of taking services mobile will not hurt them if they are hung up on VLCC, Apollo and the likes... 

End points: 
1. Dont invent new needs and delivery mediums, instead tap the consumer needs at the right places and occasions 
2. There is a fundamental need to move away from Telco VAS provider (Duopoly mindset) to a tag along/second fiddle mindset with the solution provider. 

Hope this is somewhat leading to the right direction. 

"Twitter"ing away (Part I)

Twitter has got more than its share of media coverage (if you compare it vis a vis other bigger sites like Yahoo, AOL and others. In fact if one were to create an index of the media versus the size/user base, Twitter would probably beat Facebook and Google at the indices.)

• Twitter is being used by News and Broadcating Corporations like BBC, CNN, New York Times, Wall Street Journal and others.
• The celebrity usage of Twitter is phenomenal. It starts with Barrack Obama's presidential campaign, to Lance Armstrong, Stephen Fry, Britney Spears and loads more.
• It created waves when the Janis Crums twittered the US airways flight 1549 crash at Hudson from his iPhone. (Coverage)
• Twitter was forever on news regarding its $35 million venture capital funding from Institutional Venture Partners and Benchmark Capital. (Read News)
• Tech blogs such as Tech Crunch and social networking blogs such as Mashable heavily tweet through this medium.
• Firsthand Reports from California wildfires poured through Twitter in front of media and news agencies. (read Report)

Twitter now is world's most popular micro blogging platform, a compelling social service and very soon to be a mainstream channel.It upstaged fellow rivals and web 2.0 rivals such as Digg, Flickr, Delicious in terms of Google Search querries (as reported by Google Trends). The indication here is the first time usage would have been impacted in this manner. (First time users use Search engines to locate the services). Thus presumably, more people are joining twitter than its rivals.

Alexa Ranks also indicatesthat its reach has grown 6 times over in one and a half years (from .05% in October 2007 to .32% in Febraury 2009). Its page rank has improved from 4309 in October 2007 to 233 currently.
According to Compete, Twitter’s month-to-month change is an upward trend of 32.7% whereas for the year-to-year change, it’s 964.5%. For the month of February, it states that it has 8 million unique visitors using the platform
Quantcast, a service that only tracks websites based on the number of US people who have visited them, Twitter was ranked #163 and its monthly US people has reached 6.1 million, a 600% boost from August last year. Other stats include US Demographics of which 47% and 53% are male and female group respectively. Also, the main bulk comes from the 18-34 age group.

Real time, Twitter user and client statistics, shows that an average of 2 million tweets are posted by users on a daily basis. AN indication of the success of Twitter is the Twitterholic, which indicates the folowwings per user. These numbers have gone up dramatically over the past year and half. An example in question is CNN which had a 1000 daily visitors now has 10000 visitors per day.

The growth has been dizzying and from the looks of it, Twitter has caught the eye of technology geeks, Technology Cos (Facebook, Google, Microsoft). The growth doesnot seem like it is going to slow down any sooner. 

Daily addiction:Mobile Internet

A recent study by comScore has now revealed that the number of people browsing internet through their mobile devices has doubled through January 2008 - January 2009. With job cuts, and current economic crisis in the background, mobile communication has gained acceptance as a cheaper, more accessible, convenient and more secure conduit to browsing the internet. Mobile internet has thus evolved from an occassional activity to a part of people's daily lives and routines. Among the audience of 63.2 million peopleaccessed news and information on their mobile devices within the studied time frame, 22.4 million – or 35 percent – did so on a daily basis. This number represents more than a 100 percent jump from the size of the audience the year before. 

Social networking and blogging emerged as the most popular daily uses of the mobile web access. It registered a 427% jump in traffic (January 2009 versus January 2008). News sites registered a growth of 188% and entertainment sites registered 107% growth in mobile web access.

In terms of applications, News related apps saw 22.3 million traffic, while search related apps registered 14.1 million users. Maps was popular amongst 8.2 million users. Overall, 32.4 million people used SMS to access news and information.

Comscore press release: http://ronnie05.wordpress.com/2009/03/18/daily-addiction-mobile-internet/

Of Wallet Phones and Mobile Payments

Wallet phones are mobile phones equiped to include bank cards, credit cards, house keys, company access control IDs, electronic cash, train tickets and many more functions. Wallet phones in principle can take over all functions which our wallet has.Wallet phones enable mobile operators to enter new industries, especially the payment and credit card industries. For this reason wallet phones represent innovation and disruption for established industries, such as credit cards.

Payments through mobile phones is a fundamental shift of paradigm occuring in the wireless communication industry. It originated in Japan. Due to declining ARPU Japanese mobile operators are creating new streams of income independent of voice or data traffic. This paradigm shift led DoCoMo to invest in financial institutions, create a credit brand, and make a series of other investments including brick-and-mortar business, while competing operators follow different strategies.

The NFC (near Field Communications) technology has been there on the horizon for sometime now. Currently, local mPayment transactions, also known as proximity mPayments or Near Field Communication (NFC), do not have much scope as only 1 percent of mobiles sold in 2008 were allegedly NFC-enabled and there is no widespread, popular recipient technology to complete an NFC payment. NFC is a technology that enables devices to wirelessly exchange data without physical contact within a range of 4 inches. It eliminates the need for all types of plastic transaction cards and, therefore, contributes towards saving the environment. It works in the 13.56 MHz radio frequency band, has a bandwidth of 2 MHz and can support 848 kbits per second exchange of data.

However, 2008 turned out to be the first big year of reckoning. In 2008, approximately $72 billion mobile initiated business was accrued via an estimated 25 billion transactions made by nearly 40 million consumers, which included roughly $24 billion for purchasing games, music and ringtones. 18% of US households wired to the internet have made sometype of mobile payment in 2008 including online bill payment, money transfers to individuals, online loan payments and online purchases. 

A new analysis by Juniper Research in mobile payments opportunity forecasts that, by 2013, the figures could jump exponentially to $860 billion generated made by close to 450 million consumers with 285 billion transactions, dedicated towards the purchase of physical goods (typically gifts and books) and services other than mobile content on- demand/digital goods (such as music, tickets and games). mMoneyTransfer is expected to generate more than $200 billion in 2013.

Highlights from the report include:

• Global annual gross transaction value will grow over 5 times by 2013

• The ticketing segment will be driven by consumer usage on rail, air and bus networks as well as sports and entertainment events This will represent over 40% of the global transaction value by 2013

• The top 2 regions (Far East and W. Europe) will represent over 60% of the $300bn p.a. global mobile payment gross transaction value by 2013 for digital and physical goods. Western Europe is currently dominated by digital goods and services sold via SMS, whereas the Far East & China region (specifically Japan) is already well established in physical goods sales over the mobile web, and has been for a number of years.

Informa estimates that by 2013 more than 10 percent of all mobiles in use will be NFC- enabled, technology support to receive NFC payment will be common, and these factors should facilitate close to 180 million users to pay restaurant bills, buy tickets, pay toll fees, and buy groceries, apparel and home equipment.

In 2008, only 67 million mobile phone users accessed mBanking services, whereas in 2013 the figure could reach one billion.

Amongst banks, mobile manufacturers and technology vendors, the buzz about Mobile payments is discernable. Recently Visa (the world's largest electronic payments network), demonstrated its mobile payment solution at Dubai. With a network across 170 countries, it will not be too long before Visa takes the mobile payments technology to the mass.

The stumbling block in large scale adaption would do with threat perception of transaction security. An NFC survey by ABI research indicates the transaction security to be the concern amongst users. It is only a little time and the convenience factor, which will sway the users towards use of the m-Payment platform. 

Enter Google Voice

You can often find me saying in exasperation... "there's Internet and there is Google!". It appears that the Mountain View based giant is not satisfied with its Search Stardom and wants to protract the internet technologies to disrupt other industries around the world. Google Voice, though in its infancy has the power to blow away the existing rules of the Telecom game and i daresay, that carriers and operators throughout the world are hawk eyeing Google's moves. 

First there was Google Latitude that made its debut in January 2009 and now is the turn of Google Voice. Both services combined together would serve as a full scale solution to networking, voice and data needs of people around. (Imagine yourself beaming a picture of a new dress that you would like to buy for your daughter to your wife for her approval. You are in New York and she in London or any other part of the world). That scenario with Google can give cold sweat to many other companies around who have stakes in Telecom, Voice, Data and auxilliary services.

Google, signaled what would be the next telecom technology disruption on 13th March 2009 (Read here). Within 5 days, there are half a million blog posts dedicated to Google Voice. Check them here. As i had said, in one of my earlier posts, the art of maintaining Relevance comes very naturally to Google.

Bought in 2007, Grandcentral is reincarnated as Google Voice in 2009, with a few polishes and additions. Essentially a VoIP based network, a user is given an account and a 10 digit phone number, except that there is no phone at the end of this number. Instead the user has to log onto his account and "manage" his calls. He has to specify where the calls need to go i.e either his mobile or his residence number or his voice mail etc. One can also program it such that business calls are routed to office number till 5 O clock and then go to voice mail system directly. So this becomes a single portal of managing all communicational priorities. It can also be managed for customizable features, call screening and controls and solution et all. That is the core of the technology! Out side this, there are features such as 

• Automated voicemail transcriptions — Users have the option to receive free transcriptions of all their voicemail messages.  These transcriptions are fully automated (i.e. no human listens to the voicemail), and are searchable within your Google Voice inbox.

• SMS messaging — Receive SMS text messages sent to your Google Voice phone number on your mobile device and on the web.  Send and reply to text messages directly from your phone or your Google Voice inbox.
  

• Conference calling — If you’re on the phone and receive an incoming call, you now have the option to merge your calls.  Have as many as six people join a single call.

• International calling — Place international calls at reasonable rates from your phone or by using the QuickCall button in your Google Voice inbox.  Purchase credit using Google Checkout and pay by-the-minute for international calls.
  

Read the complete feature lists here

Google Voice is available in its Private Beta option to users of the Grandcentral. With this now, Google is subverting the rules of the game by offering free speech to text messages, Free conferencing, almost free VoIP calls, Reduced International calling rates, and a link up with Gmail. All this is in effect, game changing!

There are the usual and relevant concerns with issues of privacy and the individual exposing himself to a ubiquitous company to such a large degree.The huge increase in personal content handled by one company that excels in mining such data paves a dangerous and rocky road to serious privacy issues.

Google is clearly sending another message to the rest of the telco's and wanna be telco's that Google is not happy with merely being the top of the pile in search and all things on the internet, but that it really plans to take over the communications world as well. Based on previous successes I wouldn't put it past them!

Profiling Facebook: The Google of Social Networking (Part III)

http://technologyandtelecom.blogspot.com/2009/02/profiling-facebook-google-of-social.html

http://technologyandtelecom.blogspot.com/2009/03/profiling-facebook-google-of-social.html

This is the last of the Profiling facebook series. The earlier posts have been listed above. The first post dealt with the rise of Facebook and its business model, the second part dealt with Mark Zuckerberg's vision for Facebook. This post is a critique of the Facebook's success in terms of efforts @ monetization of Social Networking Freetardonomics.

Fortune featured Facebook in an article "How Facebook is taking over our lives" in February 2009. Read the story. The focus was on the growth in Facebook users and race to mass market (Graphic below), stickiness, user demographics, Zuckerberg's vision and applications that make Facebook a very happening place!

Here is Paul Monica, (editor in chief of CNN money) critique of Facebook published as "Why i hate Facebook".


Reason 1: It is not always about Networking. There are times when people like to be un-networked.


Reason 2: With 175 million users and growing at 6 million per month, the top line sounds great. But How do you generate meaningful revenue and profits out of such a venture/user base. Popularity @ Freetardonomics is fine, but profits are cooler!


Reason 3: The first 150 million users accrued to the following in the stated number of years.
Telephone: 89 years
Television: 38 years
Cellphone: 14 years
iPod: 7 years
Facebook: 5 years
This rationale has a strong fallacy: Apple sold a product to 150 million consumers, a pretty pricey one at that where as all Facebook has done is to get people signed up for a service: a free one at that. A comment worth a mention in here is "Bill Gates did not become one of the wealthiest men on the planet by giving away operating systems for free!"

Reason 4: Social networking is about easily connecting and communicating with friends. Ads and promos wouldnot mean much to the user who is "blind" to all that the web site offers since he is single mindedly networking. Thus the inherently loose one here is that Social Websites can never be major generators of Ad revenue.

Reason 5: Efforts to tap information about users implicitely can invite legal backlash as it did with the Beacon@Facebook. This furthermore narrows the field for targetting users with relevant marketing stuff.

Reason 6: 2009 and 2010 would possibly be the toughest years in US and marketers will cut costs. Online advertising will slow down from 17,5% in 2008 to 8.9%. Facebook's attempts at Traditional online advertising has failed miserably and revenue from banner ads are small enough to ignore them as incidentals.

There are the examples of AOL and Yahoo who after a brilliant start fizzled out in trying to monetize their offerings on the web. Facebook and its team must now deliver on a telling agenda of monetizing their growth on a difficult wicket of the economic meltdown.

Mobile Operating systems by market share

Source: Garner Press releases.

In the smartphone space in 2009, mobile platforms will be a major battleground as the associated user experience and the role of the ecosystem grows in importance. The best example of this is the 25000 applications mark and the 500 million application download for the Apple iPhone Apps stores. Presently, RIM, Microsoft, Nokia, Palm are in the race to their own versions of Apps store.

The Operating systems market is now witnessing a shift from a Symbian dominated construct to a more even distribution (even though Symbian is miles ahead of its competitors in terms of size and share). Symbian's fall has coincided with the fall of Nokia's smartphone market share and the rise of the challengers such as RIM, Apple's OS X and Linux based Android. Symbian has been the last in terms of operating systems that has riden the touch device smartphone wave. Apple's OS X, has taken 10.7% of the OS market shares post its debut in 1Q,2007. Similarly RIM has gained 10% Market share points in 2007 - 08 (8 quarters). Palm has fallen sequentially and the launch of Palm OS sometime this would be eagerly watched in terms of Palm's recovery from 1% share. Microsoft has kept with the market by featuring in the Samsung and HTC smartphones. 2009 will also be important in terms of Linux's growth. Not only are more Android devices in the pipeline but also Open source is finding gaining in relevance and acceptance.

In terms of growth vis'-a-vis the market, RIM and Microsoft have grown by 257% and 60% respectively in the last 8 quarters (against market growth of 53%). Symbian has clocked a 13% growth in 8 quarters! In terms of Numbers, Symbian's 17% loss of market share can be squarely attributed to OS X and RIM.

Mobile Banking: The Future

Check out this SlideShare Presentation, which lucidly explains the concept of mobile banking, expains the dimensions and provide a good refernce point.

Banking on The Future of Mobile.

View more presentations from Conrad Lisco.

Guardian Open Platform: The launch

An addendum to my earlier blog post about Guardian's Open Platform initiative. http://technologyandtelecom.blogspot.com/2009/03/harnessing-open-source-to-power-next.html

View more presentations from mattmcalister.

Storm-controlled Formula One car a hit with Lewis Hamilton

Storm-controlled Formula One car a hit with Lewis Hamilton

Compelling video featuring the Blackberry and Accelerometer being used to run a Formula one Car (the real mcCoy with Lewis Hamilton steering the accelerometer and the McLaren Car). I am reminded of james Bond (Pierce Brosnan) using such a gadget in the Tomorrow never dies to the disapproval of Q, the gadget maker.

Posted using ShareThis

Smartphone Market Share Update

The fourth quarter of 2008 saw Smartphone sales growth rate dip to 3.7% (versus 4Q,2007). The report compiled by Gartner, says that the worldwide sales of Gartner reached 38.1 million units, and slowed down considerably due to the fewer compelling devices and a worsened economic climate. Sales in 4Q were marginally better than the Q3, 2008 number of 36.51 million. As a proportion of all mobile device sales, Smartphones bettered the 4Q, 2007 number of 11% by 1 percentage point i.e 12%.

Global sales of smartphones reached 139.3 million units for the year 2008, which betters 2007's smartphone sales (122.3 million units) by 13.9%!

The iconic Apple iPhone doubled its market share from 5.2% to 10.7%. It sold 4.1 Million iPhone against a 1.9 million number in 4Q, 2007. http://www.electronista.com/articles/09/03/11/gartner.on.q4.2008.sphones/. The buzz around this device is almost unreal, with Operators rooting for it. AT&T (Read Article) has declared iPhone 3G a success after the inroduction of the Iphone served as a catalyst for a shift towards data on its networks. It has reported a 51.2% jump YOY renue from data usage on its networks. For the full year of 2008, iPhone has reported a 245% jump in units shipped (3.3 Million in 2007 and 11.4 Million units in 2008). Canadian based Telco Rogers, has also reported 36% boost to its data revenues because of iPhone in its portfolio. iPhone now contributes 33% to Roger's Smartphone sales. (Read Article)

Boosted by the Blackberry Bold and the Storm, RIM's market shares went from 10.9% in 4Q 2007 to 19.5% in 4Q,2008. It registered a 85% growth in number of units from 4 million in 4Q,2007 to 7.4 million in 4Q,2008. Over the full year, RIM bettered its 11.6 Million sales number in 2007 to 23.1 Million in 2008 (a jump of 97%).

The T-mobile G1, the first Android operating system powered mobile, and the Touch Diamond helped HTC better its sales from 1.3 million (4Q,2007) to 1.6 million(4Q,2008), a jump of 20%.

Samsung's Omnia and its other touchscreen devices have finally led its break through into the top 5, displacing Sharp. Samsung registered a 138% growth in 4Q,2008 over 4Q,2007 taking its Smartphone number from .67 million to 1.6 million!

The looser for a while and this time as well, is Nokia, who has lost 10% market share in smartphones (from50.9% to 40.8%). While it is still the market leader by a mile, Nokia was the only compnay in the top 5 to have registered negative growth of 17% (from 18.7 million in 4Q,2007 to 15.56 million in 4Q,2008). On a year basis, Nokia stagnated and registered .8%growth in a market which grew 13%. Its full year market share reduced from 49.4% (in 2007) to 43.7% (in 2008). The numbers shipped were 60 million in both years.

Harnessing Open Source to power the next level of Business: The Guardian's Open Platform initiative

In the age of open source and democratization of content it is just time before newspapers and news agencies join the open platform and social networking as a means to stay relevant. The challenge is to customize the business model around these to make money even while they reinvent the rules of the game. Guradin, The UK based newpaper has taken its first step in this direction by launching what they call the "Open Platform". While all newspapers have a blogs, content and online presence, Guradian's venture is different.

What guardian plans is to open up millions of of pieces of content: Stories, Photos, Slideshows and data sets to all who want to process all this data through web applications and mashups etc. In its present avataar, all this is Guradian's core product, which Guardian shall open up to the internet for free! Why would someone do that?

Three reasons:

1. Guardian plans to use this channel to push advertising. In effect, by being a host to users, developers and applications, it is creating a captive base and it will push advertising feeds into this outlet as well. This thus becomes an extremely scalable way to increase ad inventories and at some stage Guardin will venture out into targetted advertising through API (application programming interface). That like creating a new G Mail and adsense.

2. Opening up all its content inventory would attract a whole bunch of programmers and developers to this platform which would nurture innovations around the core product. In an age where news feeds are so commoditized, innovations from an open source can pep up the channel offering. All this development at zero cost. Developers have already started throwing up interesting results. API maps matches news content with locations aroudn the world to create a crowd sourced geo tagged database of news. Content Tagger allows users to create web tag on Guardian database.

3. If nothing else works out, the effort is going to create branded content and applications, at no incremental cost. With no incremental costs again, Guardian will probably create plenty of new consumers and a new level of brand awareness.

All in all, an interesting piece of work, which would give us reasons and ideas on what works and what doesnot in terms of Monetizing efforts around the social networking platform in this age of Web 2.0 and Freetardonomics.

Hottest Gadgets: The T3 Hot Gadgets countdown

Voila! Palm was dead long time back... and now its back and How! It tops the 100 hottest gadgets on this planet list and the Palm Pre assumes the "iPhone Killer" title beating Nokia N 97 which comes third in the list (the next best Nokia is at 24 and is the Nokia 5800). Surprisingly Apple DOESNOT feature in the top ten (Can you believe it?). The first Apple is the iPod Touch at 12 and iPhone trails at 14. Sony is the comeback kid this time, with its age old Walkman X Series taking the cake at No 2, PRS 700BC Sony Reader at 6 and theP Series VIAO at 10! Bravia and others also make the ranks.
Read the full list here: http://hot100.t3.com/category/top-10/

Google and the art of maintaining relevance

Google is stuff of folklore now. It is more than a brand and a company, it is more of a movement, it is synonym of "search", to me it is Internet! Over the last some years i have observed, often awestruck of how this internet giant is moving from one success to another. From "just" a Search domain to an Operating system and Browser to maps to applications and more Google is ubiquitous! (While i try to stay away from singing eulogies, it is difficult to stay away from the influence of Google, if you are on the internet)

There is limited or no advertisement that Google engages in and it probably doesnot need to. Viral and word of mouth communication has taken the brand places already. How does it do it? For starter, i think Google makes headlines more than anyone else in the internet space. Whether be charges of monopolizing the web by US government, or Carbon footprint of its search engines, or the launch of Blackle, or Google Earth or Android or Chrome or Latitude or U Tube or Blogs or the outages on its email server, GMail or the bug on its search engine, there is no shadown of doubt on the fact that Google creates a headline every day almost.

Sample the latest from Google in terms of discovery of Atlantis.

Keen Observers had spotted what appeared to be the remains of a vast city under the sea, the size of wales on the floor of Atlantic Ocean. Thus the Atlantic Ocean was spotted on Google Earth! It was only explained later that the lines were the artifact of Google's map making process! These were the paths made by the boats using SONAR to record the sea floor terrain data. Atlantis or no Atlantis, Google was the news maker! Another very impressive application of Google Earth was the toad crossings mapped by Google Earth to avoid the number of toads killed by Motorists in accidents! Thats something that PETA would be in for... Amongst others Google Earth in reality has helped locate pristine forests in Mozambique, a house of a previously unknown species and ancient roman villas.

All said and all done, such discoveries, outages apart from its technology and innovation keep up the prominence of Google amongst people and populations... It keeps the buzz going outside of the internet space as well.

Indian Telecom Story (Part VII):Reduction in Mobile termination charges

I had discussed the Mobile Termination charges in an earlier blog http://technologyandtelecom.blogspot.com/2009/02/indian-telecom-story-part-iii-entry.html and this was a month back (9th February 2009). TRAI has finally taken the mid road to the question of Mobile termination charges. Mobile termination charges are basically the per minute charge paid by an operator to another, if a call of the first operator is terminated on the second's network. To that effect, any operator with a national coverage has lesser probability of paying this termination charge because chances are that the call will be terminated on its network owing to its ubiquitous presence. Thus the incumbents could use this as a pricing barrier against newer entrants. The chief beneficiaries of the MTC regime are the 100% footprint operator such as Airtel, Reliance, Vodafone etc. Lobbying for the case of MTC as a means to generate returns to serve their rural expansion, it can be debated that the Lobby had tried to impress TRAi and DoT hard on this subject. On the other hand the new players to the party have clamored that a MTC regime would make it difficult for them to establish a reasonable presence because of the price disparities.

As of today TRAI has slashed the MTC charges from 30 paise per minute to 20 paise per minute there by taking the mid road between these two views. The effects of this:
1. Likely reduction in Revenues for the incumbents
2. A more uniform battle ground for new entrants
3. Lowering of the telephone tarriffs for consumers on roaming
4. ARPUs further reducing on account of roaming charges.

Thus to an open market, reduced prices, commoditized products and more competition, here it is: Jaye Ho!

Apple: Software Services as Differentiator

Customer loyalty is a thing of the past, or so it is believed. Not with Apple though! RIM, Nokia, Microsoft and Pre are busy in their preparations to launch their own options of App. Stores, and it might seem that this will take the wind out of Apple's Apps Store sails. Au contraire, quite the reverse seems to be the case as Apple seems to be accelerating both in terms of number of applications on their stores and the downloads. On March 5th, 2009 Apple registered its 25000th application in its iPhone store. Before this, sometime in mid January, Apple had passed the 500 million mark in downloaded applications! For full report click here!

The 25000 apps and 500 million downloads on 23 million devices act as a part of a software strategy, which creates a distinct stickiness for the iPhone and enhances customer loyalty over the long term. It is believed that the Apps personalize the iPhone to levels that competitors cannot match and consumers cannot do without. This creates a huge stickiness between the consumer and the product. A device tailored by him according to his requirements in the one thing that he needs the most and at present Apple does seem to have both the device and software wherewithall to give suffice his need.

While Apps range from free to $999, it is but obvious that the ones in the lower price brackets < $2.99 consitute 80% of the apps and probably will also feature as much in the downloads!

Profiling Facebook: The Google of Social Networking (Part II)

In the earlier part of this post (part I), i had written about the Facebook phenomenon and its about its popularity and its business model. It is doing to social networking what Google did to the evolution of internet and search as a whole. Little wonder that it is the largest social networking site and in top 10 websites of the world. http://technologyandtelecom.blogspot.com/2009/02/profiling-facebook-google-of-social.html

While this schematic is a little old (June 2007) it gives a pretty clear picture of the dominance of social networking websites in the world. The Dark Blue (Facebook) features prominently in Canada, Australia, South Africa, Egypt, UK, Scandinavia, South Korea, Italy and parts of Eurasia. Since then the spread of the Blue would have increased by a factor of 3.5 and would porominently feature the whole North American continent. Facebook's march to 200 million users earnestly began in January 2008, when it made translation tools available to the international user. Today more than 70% Facebook users are outside USA and most of them read it in their native language.

In 2005, Mark Zuckerberg had outlined his vision for Facebook to be an online "social utility" tool which would mean a global digital phone book which users would use to locate people on the web. In strictest terms the vision has not changed very hugely except that instead of Phone book (assisting medium), facebook intends to usurp the position of the phone itself. He dreams of Facbook to be the central portal for communication, work and pleasure. It also becomes the central place where users organize parties, store pictures, find jobs, watch videos and play games. eventually , Facebook will become an online passkey to gain access to websites and online forums that require personal identification. In other words, Facebook will be the place where people will live their digital lives in the internet of the future.

Zuckergerg vision has found teh traction and has a 175 million "friends" following. However the question of monetization of traffic is something that most of the Web 2.0 evangelists are wrangling with. We will analyse the business macros of Facebook in the next part of the series in some time.

The Ascendance of Apple

This has been Apple's decade. From behind and nowhere, this Cupertino, California based hi tech company has disruptive technologies and trends and worked its own path upwards. In the process, it has emerged as America's no.1 most admired company, sales have tripled over the last 5 years and it ranks no.1 amongst Fortune 500 companies for total return to share holders over the past 5 years (94%) and past 10 years (51%). The latest feather in Apple's cap is a successive listing (2008 and 2009) in America's most admired company list and World No 1 in most admired companies list. This 32 year old company had an unprecendented run since 1997 disrupting conventional wisdom on product lines and groundbreaking new products. Led fully from the front by Steve Jobs, Apple has out thought, out innovated and out played markets and competitors alike.

Timelines, Products and Discontinuities
As stated earlier Apple has launched waves of discontinuity in industries turning tables on the existing rules of the game:
1. Pixar, which Steve Jobs bought from George Lucas in 1986, out innovated the Hollywood mainstream into full length computer animated movie making with its Toy Story in 1995. It redid its success in 1998 Bug's Life, 2001 Monsters Inc, 2003 Finding Nemo, 2004 Incredibles. 2006 Cars. Pixar is sold to Disney in 2006 making Steve Jobs Billions.
2. In 1998, Apple upturned the desk top with its colourful IMac, which became the fastest selling Macintosh ever!
3. In 2001, which is arguably Apple's biggest year till date, it released the iPod, iTunes and OS X operating system. 8 years later, 50% of Apple's revenue come from iPods and iTunes store is the second largest music retailer in the US with 6 billion downloads. It spawns a plethora of attempts by Telecom industry players, notably Nokia and Microsoft to build a Music store, on a somewhat different business model.
4. iPod Nano is released in 2005 and is a huge hit. iPod becomes to music players what Kleenex is to tissue or Xerox is to copiers.
5. iPhone is introduced in 2007. Gets the status of Jesus phone and in one sweep upturns the existing game inthe mobile device industry. Spawns a record number of copy cats.
6. 2008: MacBook Air released, a ultra thin 13 inch wide sleek metal laptop. Apple again triumphs
7. 2008: A faster cheaper and more powerful iPhone 3G debuts and outsells the original by a mile.

Apple has demonstrated how to create real, breathtaking growth by dreaming up products so new and ingenious that they have upended one industry after another: consumer electronics, the record industry, the movie industry, video and music production.Apple's approach is to put every resource it has behind just a few products and make them exceedingly well. Apple is brutal about culling past hits: The company dropped its most popular iPod, the Mini, on the day it introduced the Nano (a better product, higher margins --> why dilute your resources?).

The culture of Innovation and the leadership of Steve Jobs has gotten Apple so far. As all and ever, everyone waits for Apple's next innovation, its next endeavour to change history.

Examining the case for Nokia Netbooks

Lap Top makers Lenovo, Dell, and Acer have announced their ventures into the smart phone space. I had covered a few of these in earlier blogs.
http://technologyandtelecom.blogspot.com/2009/02/smartphone-debut-dells-mephone.html
http://technologyandtelecom.blogspot.com/2009/02/lenovo-promising-smart-phone-debut.html
http://technologyandtelecom.blogspot.com/2009/02/toshiba-timeline-iphone-in-its-sights.html

Now, the king in the mobile space, Nokia takes the battle to the enemy camp by announcing its foray into netbooks. Olli-Pekka Kallasuvuo mentioned in a recent interview that Nokia was “actively looking” at the laptop market as the cellphone and mobile PC markets get closer and closer to convergence (read article http://www.reuters.com/article/technologyNews/idUSTRE51O6Z320090226). This had created the immediate buzz that it was expected to create around the technology geeks and followers around the world.However, this is more than i-fight-you-at- your-home-while-you-fight-me-at-my-home motive out here (meaning Nokia fights the lap top makers with its entry in that segment, even while Lap top makers try to prey on smartphone space). For starters, Nokia was already the largest computer maker in 2008, if the smartphone population are allowed to be counted in as computers.

An interesting line of thought that has featured in Nokia Conversations (Nokia's informal PR window to the world) is about how "mobile lifestyle" is fusing with "mobile computing" even as internet apps change the mobile phone from a medium of communication to projectors of our selves in the cloud. (Suggest the article as a compulsary read). Essentially, there are three major take outs from the article
1. Mobile devices will have to evolve to more creative usages in networking people.
2. The Cloud will be a platform where people would needto project themselves as a means of communication with others
3. Hence the need for a netbook device!

The article very beautifully explains the device story behind the need to graduate from Mobile Computing to Cloud enabled netbooks. So Nokia's device strategy follows the convergence story as it unravels and transitions from a N 97/ iPhone to netbook!Interesting times, as industries converge and new paradigms emerge. However the question that pops up is, whether Nokia is doing things one too many? Its 2007 - 2008 strategy has revolved around services and even after a while, Ovi is not exactly "there" in terms of consumers, services, applications and stickiness. The opportunities for Nokia's software services would surely outweigh the cost of building a commodity consumer electronics device.

The first reaction to this one is Nokia shouldn't be looking at the netbook space. They've got enough on their plates at the moment, the new devices need attention and promotion, it will confuse the marketing message, there's very little profit in commodity devices...

On the other hand the Netbook can be seen as a natural device extension of the Ovi platform which links up from the consumers to the crowd.

My take on this is Nokia should be looking at its services eco system foremost. Netbooks will seriously not be an differentiator in the age of content and the internet. Investements in the netbook may not be both time, investment and attention consuming for very little returns.