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India calling: Mad rush to build mobile platforms

Source : BUSINESS_STANDARD
Last Updated: Sun, Mar 18, 2012 20:11 hrs

India’s mobile subscriber base is expected to reach 1.2 billion by 2015 and companies are experimenting with new ways to tap this market. Also, they are looking to explore avenues to monetise mobile platforms used by consumers

They are trying hard to break into your mobile device but haven’t yet figured out how. A market of 900 million mobile subscribers is simply too lucrative to ignore for brands and businesses. Take for instance the social networking giant Facebook and internet’s biggest brand, Google. They are experimenting to find ways to monetise their platforms used by the Indian mobile consumers. Poster-child of Indian e-commerce, Flipkart, too, is ready to break in to the mobile landscape and launch a platform similar to what the website has built online.

What’s in it for the mobile subscribers? Jonathan Bill, head (internet & VAS), Vodafone India, reasons, “Industry data tell us that India’s mobile subscriber base will reach nearly 1.2 billion by 2015. Those businesses that have built successful models online — from e-commerce to online TV services — now need to step into the mobile market and make consumers use their services on the small screen.” A growing mobile internet population — IMRB International’s ICube study estimates active mobile internet to be around 26.3 million—is encouraging.

Entertainment services such as listening to music, regional language content and Bollywood movies will be adopted by the masses, believe industry experts. “Adoption of mobile services like Live Sports will be in tandem with increasing viewership for all sports such as cricket, soccer, formula one and tennis. While mobile TV, banking transactions, weather and location-based services need a segmented approach to penetrate the Indian consumer segment,” lists PwC.

Charting the course
About 55 per cent of the claimed mobile internet users are in top 8 metros (Mumbai, Delhi-NCR, Kolkata, Chennai, Bangalore, Hyderabad, Pune and Ahmedabad). And Flipkart will start its mobile commerce here. Sameer Nigam, head (Digital Distribution), Flipkart feels that getting mobile payment right is critical for the success of the business. “We will deploy pre-paid mobile wallet-like system where users can deposit money online in their Flipkart account and then purchase on their mobile devices. We will begin with books and digital entertainment in select cities to see how customers receive the service.” The e-commerce portal is also in talks with mobile operators that will allow users to purchase through mobile and pay the amount to the operator in their monthly billing. Flipkart’s mobile foray is expected later this year, Nigam informs.

Mobile value-added services like ringtones to on demand video, claims Bill of Vodafone, are rising steadily on its network. “With the advancement in technology, even mobile phones at the lowest price points today can support powerful applications which empower the user in a variety of ways, from exchanging information via SMS, accessing entertainment based services to checking bank account details, crop prices, receiving personalised health alerts and obtaining vocational training. We are at various stages of deployment of same.”

About 90 per cent of the active mobile Internet respondents have a prepaid mobile connection. IAMAI estimates that the average handset cost for an internet-enabled phone is approximately Rs 6,700, and the average mobile phone bill for an active mobile internet user is Rs 389. Farshad Family, MD, Nielsen opines, “Consumers won’t shy away from spending money on content and services that are relevant to them, but businesses need to build a trust with the users before thinking of earning money. For now, users trust their mobile operators and that’s a good start to a payment channel for mobile services.”

Cashing the user base
Rajan Anandan, vice-president and MD, Google India, says, “People search for the simplest of things—from where the best restaurant is to using map locations and chatting with people on their mobiles now. Google Search, thus remains our biggest mobile product.” Mobile search has seen a significant increase in India, with over 40 per cent of searches already occurring on mobile and it is one of the most popular activities for mobile users. While usage has picked up, ad revenues from mobile search are currently limited. But that’s not troubling Google. “We have seen a rise in location-based advertising, which could be a key growth driver ahead,” he says.

HANDY ACCESSORY
MOBILE SERVICES CURRENT ADOPTION FUTURE ADOPTION WILLINGNESS TO PAY
(Rs per month)
Getting updates on profession 2% 11% 111
Stock market trading 2% 12% 49
Purchasing products 4% 20% 83
Mobile TV  6% 38% 53
Booking tickets, hotel 10% 38% 64
Regional content 7% 47% 80
Getting medical advice  0% 49% 73
Bollywood content 12% 54% 77

Another popular service is mobile videos or mobile streaming where platform owners are still finding means to monetise the content.

Jigsee, a Toronto-based startup, that has a free video streaming application for mid to lower end mobile phones, saw people spending an average 40 minutes watching videos. “And this was when we are talking 2G networks and handsets that aren’t even smart devices,” says company’s founder Ray Newal. The application employs a patent-pending streaming technology that helps deliver continuous video on wireless networks with data rates as low as 50 kbps. The company is now adding premium content and will partner with operators to bill the customers for videos consumed. “Jigsee is soon coming out with an Android app for smartphones and will look at options like cash cards that will extend sachet-pricing options to users who are comfortable paying a few rupees for on-demand videos, full length movies and regional content etc,” informs Newal.

According to a Nielsen Informate Mobile Insights study, smartphone users in India spend about 150 min/day on their phones and more than 50 per cent of this time is on browsing, entertainment and applications. E-ticketing for movies, rail travel, air travel, etc are some other popular applications of mobile internet, adds IAMAI. Ultimately, the key enabler to allow mass consumption and monetisation of content on mobile platforms will be the providers’ ability to viably facilitate micro transactions at a sub-Rs 10 transaction size, points a FICCI-KPMG report.

So, get ready to be wooed by businesses on your mobile phone.




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