I have heard of horrific tales of the US mobile users. I have heard how you are not allowed the handset you actually paid for is not yours. How, the users have to go with a particular service provider if you have got your heart on a particular model. How even if you switch its illegal to install a software on your cellphone which your telecom operator does not like and how you have to jail-break your cellphone if you want to do as little as take it abroad and use it with a local number.
Sounds scary ? Well, welcome the trend to India. iPhone as most of us know would only work with Vodaphone and later Airtel. So if you want to change your phone, well change your number (since there is lack of number interoperability. As yet). And now, its the turn of HTC touch diamond to go "exclusive" with Airtel. What is cruelly ironic is that HTC hadn't cut a deal with any of the American providers to market touch Diamond.
But there is more to it than meets the eye. Consumers in the US get these cellphones at throw away prices. The telecos subsidizes these cellphones heavily in exchange of a lock-in period. However, our very own Indian telecos have flatly refused to subsidize these cellphone even by a penny citing difficulty in implementation the clauses of the contract.
So, now you would have to pay the retail prices for these cellphones AND would have to sign a lock-in contract. So now you would have to pay 15 - 17k for an iPhone or about 27K for an HTC touch diamond and HAVE TO go with Airtel or Vodaphone if you want to use while our American counterpart pay as little as $199 for an iPhone and $99 for a HTC touch diamond with same clauses. Talk about double whammy.
As far as I am concerned, I think it is outright wrong for a service provider to meddle with the handset business. If the user is paying for the cellphone, he has an absolute right to decide how to use it including with which telecom operator to chose. But the telecos are becoming more and more greedy everyday and not satisfied as serving as a pipe. They not only want that the user uses their service but also how it uses it. It is outright insane, in tune with saying that I would have to subscribe to a particular ISP if I want to use a Sony Viao laptop or a Macbook Pro. It is absolutely absurd. And they are not willing to pay anything for this control. Talk about being cheap.
I wish this trend would not be successful in India, but with the hype that iPhone has created, I highly doubt it.
Saturday, July 26, 2008
Saturday, July 19, 2008
The 3rd generation
Today at Proto4, I was drawn into a discussion with Varun (as I usually do) about the advent of 3G in India and its impact on VAS providers and mobile software developers. During the last 2 days at Proto and Medianama I have repeatedly heard people saying the same thing. How 3G is going to force Telecos to be more receptive towards VAS providers. About how 70-30 revenue sharing model would become obsolete and how VAS providers would finally get their dues. Mostly the argument goes as follows:
The telecos invest huge sums of money in 3G infra. They want to get a quick ROI and hence look toward VAS providers and mobile application developers to increase data usage. Since the competition shifts to data and VAS now, the cut throat competition makes VAS operators important players and who in turn can ask for a better pricing model.
The argument sounds very logical and really makes sense. Also, it is incorrect. I do not think mobile market is opening up to VAS providers any time sooner. And I have my reasons. Yes, its true that telecos are investing heavily in 3G and would definitely look at 3rd party providers to leverage enough data usage to get an ROI. Except that the 3rd party players are too many. And if you make one successful mobile app today. In India, expect clones to be launched as soon as you can say "Ta-Da". There are 5 major telcos and a LOT of VAS providers / developers / entrepreneurs / Web 2.0 enthusiasts. Supply would always outstrip demand. .
In fact, I have a strong inclination that Indian mobile space is going to get more closed before it opens up more. There is a dearth of 3G devices in India and the mobile operators would like to get more and more users on board. Which means they would have to subsidize devices like their American counterpart. Now, at this point, the telecos have invested in the infrastructure and the handsets. I think it would only be fair to expect that they would want to control how user uses the bandwidth that they want him to use. The signs are ominous.
However, I cannot help but agree that the bandwidth costs are bound to come down with 3G. In a price sensitive market like India you cannot sell expensive and expect returns. So, to get mobile users to get on mobile web, the telecos would decrease cost and the scenario would be similar to the call charges with everyone trying to get a bigger piece of the pie without looking at short terms returns.
So, in short, in my opinion, if you are a VAS player, do not expect the things to be merry once 3G comes in. Its dark days ahead buddy, and it would only help to be prepared. But the night is the darkest just before the dawn, so things would change and the industry would mature. Till then, go look up perseverance.
The telecos invest huge sums of money in 3G infra. They want to get a quick ROI and hence look toward VAS providers and mobile application developers to increase data usage. Since the competition shifts to data and VAS now, the cut throat competition makes VAS operators important players and who in turn can ask for a better pricing model.
The argument sounds very logical and really makes sense. Also, it is incorrect. I do not think mobile market is opening up to VAS providers any time sooner. And I have my reasons. Yes, its true that telecos are investing heavily in 3G and would definitely look at 3rd party providers to leverage enough data usage to get an ROI. Except that the 3rd party players are too many. And if you make one successful mobile app today. In India, expect clones to be launched as soon as you can say "Ta-Da". There are 5 major telcos and a LOT of VAS providers / developers / entrepreneurs / Web 2.0 enthusiasts. Supply would always outstrip demand. .
In fact, I have a strong inclination that Indian mobile space is going to get more closed before it opens up more. There is a dearth of 3G devices in India and the mobile operators would like to get more and more users on board. Which means they would have to subsidize devices like their American counterpart. Now, at this point, the telecos have invested in the infrastructure and the handsets. I think it would only be fair to expect that they would want to control how user uses the bandwidth that they want him to use. The signs are ominous.
However, I cannot help but agree that the bandwidth costs are bound to come down with 3G. In a price sensitive market like India you cannot sell expensive and expect returns. So, to get mobile users to get on mobile web, the telecos would decrease cost and the scenario would be similar to the call charges with everyone trying to get a bigger piece of the pie without looking at short terms returns.
So, in short, in my opinion, if you are a VAS player, do not expect the things to be merry once 3G comes in. Its dark days ahead buddy, and it would only help to be prepared. But the night is the darkest just before the dawn, so things would change and the industry would mature. Till then, go look up perseverance.
Sunday, July 13, 2008
India and the copyrights
The Indian film industry has demanded that the copyright period for films should be increased to 100 years from the current 60 years. Since old films are still good business in Indian, none of the big businesses want to let go the cash cow. Interestingly, the Ministry for Information and Broadcasting Ministry has backed the claim.
Draconian copyright laws is not an oft-discussed topic in India even though at 60 years it is full 10 years more than the 50 years prescribed by the World Intellectual Property Organization and full 46 years more than the optimal period of 14 years as pointed out by some researchers.
But as the times change copyright is gonna get more and more important in India. First of all, the Indian film and music industry like its American counterpart is a big money business. Secondly, the Indian film and music industry is much-less if at all tech-savvy than its American counterpart. Its a matter of time when we would have our own home-bred MPAA and RIAA start suing people left and right. And thirdly, as the Hollywood influence increases, we would tend to follow the bad precedent. Though, Indian judiciary is over-worked and has a long queue of pending cases, so its not anytime sooner that we would see people facing trials for this kind of stuff.
This might not happen at all and I hope it doesn't. And old films are part of the Indian culture now. And nobody gets a monopoly over our culture ? Right ?
Draconian copyright laws is not an oft-discussed topic in India even though at 60 years it is full 10 years more than the 50 years prescribed by the World Intellectual Property Organization and full 46 years more than the optimal period of 14 years as pointed out by some researchers.
But as the times change copyright is gonna get more and more important in India. First of all, the Indian film and music industry like its American counterpart is a big money business. Secondly, the Indian film and music industry is much-less if at all tech-savvy than its American counterpart. Its a matter of time when we would have our own home-bred MPAA and RIAA start suing people left and right. And thirdly, as the Hollywood influence increases, we would tend to follow the bad precedent. Though, Indian judiciary is over-worked and has a long queue of pending cases, so its not anytime sooner that we would see people facing trials for this kind of stuff.
This might not happen at all and I hope it doesn't. And old films are part of the Indian culture now. And nobody gets a monopoly over our culture ? Right ?
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