Monday, February 7, 2011

Mobile advertising banks on 3G lift-off


A 2010 report by Google declared India as the second-biggest consumer of mobile Internet after the US, according to data from 15,000 mobile websites monitored by the company. It accounted for 5.9 per cent of the 14 billion web pages seen on mobile phones worldwide in a particular month, so roughly 800 million web pages were viewed in India in a month. Add to that, mobile ad networks estimate around 5 billion ad impressions were served in India in a month in Q4. Impressive numbers these...
But not good enough for Indian marketers it seems. Estimates of money spent on mobile advertising vary, but the most optimistic put it at around Rs 100 crore annually, a large part of which too goes into SMS based marketing. A measly amount when compared with the Rs 25,000-odd crore spent by Indian brands annually on marketing, 80 per cent of which goes into television and print. These two media in turn boast of 600 million viewers and 140 million readers, respectively, as compared to mobile Internet, which commands little more than 15 million users.
With roughly one-tenth the print audience size, mobile attracts just one-hundredth of its money share. The medium once touted as the next big thing after Internet is struggling to convince marketers to hitch on. So, what has gone wrong?
To start with, penetration of VAS mobile services beyond main urban centres has been the bugbear of the industry. Bandwidth limitation resulting in slow speeds and a small screen size that limits flexibility and interactivity aren’t exactly features that endear brand owners. Despite adding millions of customers every month, mobile companies haven’t seen a proportionate uptick in usage of VAS, thus restricting advertiser interest. A large majority of mobile marketing in India happens through SMS promotion, which, too, given TRAIs new rules on spamming is under threat of being locked up.
Although issues such as these have restricted the growth of mobile advertising, technological advancements, a critical mass of users and impending 3G wave might soon come together to change all of that.
Consider this. A Boston Consulting Group Report last year on BRIC markets predicted Internet users in India might grow to 270 million by 2015 from the current 81 million. Which means in another four years, Internet user population will touch close to 50 per cent of the TV viewer population today.
Current daily usage of Internet, which is half an hour, will go up to 0.7 hours per day by 2015 on the way to catching up with the US and China, which are both more than two hours per day.
India had 12 million mobile Internet users as of 2009, which was 2 per cent of all mobile phone users and 15 per cent of all Internet users, figures that will see a drastic jump over the next few years.
Assuming 25 per cent of Internet access will come through mobiles by 2015, the mobile Internet user population can potentially jump to 70 million, almost six times the size today.
Add to that an expected 3G mobile user base of more than 100 million in next three years’ time creates perfect conditions for the mobile advertising ecosystem to develop.
Mobile advertising actually could go at a much faster clip than digital advertising. Where Internet usage has been plagued by penetration and bandwidth issues, mobile phones have managed to surpass these problems. A ready mass base of active connections, coupled with better and low priced handsets and adoption of 3G could help it get to a threshold level of being considered as a serious advertising medium in the not too distant future.
Technology advancements are driving rapid mobile Internet adoption. India is going to see 3G services taking root this year. With bandwidth and slow Internet speeds no more an issue, many new possibilities will open up.
According to a recent Cisco forecast, in just four years two-thirds of the world’s mobile data traffic will be video. Larger numbers of feature phones (non-smartphones), which are the staple in India, are getting more sophisticated. According to the report, the average mobile network connection speed worldwide doubled from 2009 to 2010 – and a tenfold increase is expected by 2015.
Advertising money, in turn, is waiting to be tapped. Worldwide, search attracts the largest pie of advertising on mobile. Out of a total online advertising spend of $25 billion, IDC estimates put US mobile ad market at $900 million. More than 40 per cent of this money goes into search. India also might see a similar trend.
With increasing availability of good quality low cost phones that can support browsing and apps, and a young aspiration led TG, mobile Internet penetration could mirror mobile connection growth of the last few years. From booking movie tickets on mobiles to locating restaurants or brand outlets and multi-player gaming, mobile phones will offer advertisers and brands the medium closest to point of purchase.
The world’s two largest technology companies have also bet their future on mobile advertising.
Apple bought out Quattro Wireless last year to create iAds, while Google bought AdMob, a mobile advertising network, indicating where the battle of future ad spends will be fought. Both of them see mobile phones becoming the premier device of media consumption and want the biggest slice of the action.
Apple might not have become the dominant player in India that it is known for across the world, but the iPhone launch four years ago turned the entire worldwide mobile phone industry upside down. By making software a key part of the device, Apple created a hook for users to spend increasing amounts of time on their phones, thus rivalling other media for consumer mind space. A strategy that worked so wonderfully well has ensured the mobile phone’s space as the premium content consumption device of the next decade. Every single mobile phone company has followed the same path, thus expanding the market multi-fold.
A report from Berg Insight predicts the total value of the global mobile marketing and advertising market to grow to around €13.5 billion in 2015, at a compound annual growth rate (CAGR) of 41 per cent over five years from 2009. This will correspond to 15.7 per cent of the total digital advertising market, or 3.4 per cent of the total global ad spend for all media. An Indian mobile advertising industry of similar proportions could change the face of marketing in the country.source

Top 10 Operators in INDIA 2011


Top 10 Mobile service Providers in India 2011

List Of Mobile Phone Service Providers in India: 

Below You can find the list of Mobile Service Providers and their Market Shares


OperatorSubscriber baseMarket Share

1Bharti Airtel146,293,07821.34%
2Reliance Communications119,351,43817.37%
3Vodafone118,038,43817.08%
4BSNL80,739,93511.31%
5Tata Teleservices80,817,29811.47%
6Idea76,023,55110.84%
7Aircel47,519,6296.64%
8Unitech13,748,3001.05%
9Loop3,009,4450.45%
10Sistema7,121,7650.86%
11MTNL5,342,0390.81%
12Videocon5,616,1520.43%
13Stel1,867,0600.22%
14Etisalat70,8290.01%
15HFCL Infotel1,132,4770.13%


All India706,691,164100.00%


Top 10 Mobile Service Providers in India:


1Bharti Airtel
2Vodafone
3Idea
4BSNL
5Aircel
6Tata Serviceable
7Reliance Communications
8MTNL
9Unitech
10Loop


State wise Mobile Phone Subscribers: 



StateSubscriber basePopulation (01/08/2010)Mobile phones per 1000 population

1Uttar Pradesh92,867,835199,415,992427
2Maharashtra84,543,727110,351,688707
3Tamil Nadu63,671,52867,773,611881
4Andhra Pradesh54,000,37984,241,069600
5West Bengal51,901,96790,524,849520
6Bihar46,311,29197,560,027430
7Karnataka43,802,68858,969,294709
8Gujarat40,158,66258,388,625618
9Rajasthan38,649,78467,449,102535
10Madhya Pradesh38,295,89672,362,313489


India706,691,1641,188,783,351580


Africa waiting for MOBILE DATA EXPLOSION

Mobile data and applications are the next growth areas in Africa's mobile network industry, according to operators and solution providers at the Next Generation Telecoms Africa Summit recently held in Nairobi, Kenya.
Faced by declining incomes from the mainstream voice business – as tariffs plummet amid fierce competition – the industry is looking to value-added services (VAS) to shore up its bottom line, spurring rapid innovation in mobile services, delegates at the summit heard.
According to the delegates, latest data from Opera shows Africa's data usage grew by 331% last year – the highest of any region – with SA, Nigeria, Egypt, Kenya and Ghana making the top five countries in terms of page views.
SA and Nigeria made it to the top 10 globally, ahead of the US and Brazil. In addition, Opera notes that countries like Sudan and Zimbabwe have registered impressive growths in terms of page view growth at 4 900% and 2 300% respectively.
However, telcos will have to look at how to get spectrum at reasonable prices and ensure an efficient content delivery architecture said Patrick Puges, vice-president of emerging markets networks and IT at Telkom Orange.
“We have seen very strong customer expectations demanding competitive pricing and quality end user experience,” he said.
This has meant that even with the phenomenal growth of mobile data, revenue from VAS is still rarely hitting 10% of operators' total revenue, Puges explained, noting that however, that is expected to grow to 30% in the next three to four years.
The delegates noted that supporting infrastructure, regulatory frameworks and taxation were key drivers in boosting the growth of the data market.
Safaricom's CEO Bob Collymore added that access to affordable 3G handsets will be instrumental in driving mobile Internet in the continent.
“We have just launched [in Kenya] the cheapest smart android phone in partnership with Huawei at only $100,”said Collymore.
Globally, mobile data penetration is expected to hit one billion subscriptions in 2012 and although voice still remains the cash cow for telcos, operators seeing reduced margins are resorting to providing additional services.
It also came to the delegates' attention that Africa is additionally seeing a big leap in mobile applications that enable subscribers to access information, transact and get services. rest on -source

Reliance Starts World Cup Promotion

Reliance Mobile kicked off a series of promotional activities here last night for ICC World Cup beginning next week.

Vinay Chandhok, Hub Head-Gujarat & Rajasthan, Reliance Communications , today said "we are offering live streaming, scores and commentary on mobile platform and ICC Cricket World Cup 2011 theme song as caller-tune."

Vadodara is the only city in Gujarat for hosting this event after Jaipur, he said.

Aanshuman Gaekwad, former coach of Team India, was present at the Reliance Mobile's Trophy Preview here.

The company received overwhelming response to its value-added services (VAS) offerings from cricket loving fans during the ICC World T20 tournaments, Chandhok said.

Encouraged by this, Reliance Mobile is set to launch a host of services that will provide exciting audio and video content on both 3G and 2G platforms during the mega event, he added.

Mobile Financial Services Adoption Easier in Rural Areas

As against the existing channels of delivery of banking and financial services in the rural under-banked areas, adoption of mobile financial services (MFS) may tend to be easier, says a study by the Indian Institute of Management, Ahmedabad (IIM-A).
Conducted by faculty members Rajanish Dass and Sujoy Pal, the working paper has tried to study factors benefiting as well as detrimental to adoption of MFS in under-banked rural areas. The paper defines MFS as one encompassing a broad range of financial activities that consumers engage in or access using their mobile phones, namely mobile banking (m-banking) and mobile payments (m-payments).
Findings of the study "indicate that the demand for banking and financial services and the amount of hardships faced in availing these services through the existing channels of delivery can act as strong drivers for MFS adoption among the rural under-banked".

On the other hand, factors like lack of trust on technology and lack of technology readiness were found to act as barriers to the adoption of MFS. Adoption of MFS in under-banked rural areas also witnesses lesser resistance due to lack of probable risk involved in technology. "Factors like perceived risk and concerns about privacy and security of the MFS that were found to be pronounced in the existing studies that were conducted on population having adequate accessibility to various alternative channels of financial services, was not observed in the case of the rural under-banked population.
This can also be related to lesser resistance among the rural under-banked in switching from the existing channels of financial service delivery to MFS as compared to the population that is comfortable with the accessibility and quality of the banking and financial services available to them through the existing channels," the study further states.
The study also revealed that the demand of core banking and financial services as well as hardships faced by the population in availing such services through existing channels of delivery were prime drivers for adoption of mobile enabled financial services among the rural under-banked. As for the prime bottlenecks, the paper suggest lack of trust and low technology readiness as deterrents in adoption of MFS.
Moreover, highlighting perceived financial cost as a matter of concern among the rural people, the study suggests that such bottlenecks "could be removed or reduced through increased awareness and usage among the peers".source

Last.fm Moves to Paid Content Model

Champion of free music streaming services, has pulled an about-face, and is largely moving to a paid subscriber model for its mobile service on smartphones and tablets. Starting next Tuesday, February 15th, Last.fm's "radio service" in its mobile apps, and some home entertainment devices will "become an ad-free, subscriber-only feature" according to an official blog posting. It'll remain free-to-access on its website in the U.S., U.K., and Germany and for U.S. and U.K. Xbox and "Windows Mobile 7 phones" and through its desktop app.
What's the reasoning here? Money, of course. The blog posting explains why the change is due to a desire to move to an ad-supported model. In the U.S., Germany, and U.K. the free streaming model for desktop access to Last.FM's tracks works, with enough eyeballs-on the adverts to bring income to Last.fm. But in "other markets and on emerging mobile and home entertainment devices, it is not practical for us to deliver an ad-supported radio service." Last.fm spins it as a move to deliver "what we believe is the highest quality, lowest cost ad-free music service in the world," which may or may not be true. What is certainly true is that the experimental ad-model just isn't delivering enough cash.
In some senses, this move is not at all surprising: Similar services are already using a paid-only model to deliver streaming music, and Last.fm notes this "change brings us in line with other music services that already charge you." To maintain its user base, Last.fm is pricing the service carefully--"for the cost of a fancy coffee" ($3) you'll get one month's access over "all platforms."
But the move could be taken as a bad sign for Last.fm itself, and also for Spotify's oft-delayed entry to the U.S. market. For starters, erecting a paywall hasn't exactly been a smart move for the newspaper industry, and though a paid subscription music service beats digital music industry-leader Apple to the punch (it's long-awaited subscription service has yet to surface) it's not as attractive to consumers as free-access, even given Last.fm's strong brand reputation.
Negotiations with the recording industry are apparently a big barrier to Spotify's U.S. entry, (with free access to content being a large stumbling block), and the music business may become more reluctant to license its music if that's proven to be an unsuccessful financial model.

MOBILE BASED PROXIMITY SERVICE FOR OUTDOOR MEDIA

Outdoor media has been trying to re-invent itself for quite some time now. The latest attempt comes from Amobee Media Systems which announced a new proximity marketing model for advertisers that promises to deliver 100% measurable, performance-based campaigns. The idea comes from fusing traditional outdoor media with the power of mobile technology, allowing for interactive experiences.
The technology can locate a user and identify what mobile device they are using to personalize the campaign for each user and enable interaction with outdoor media via SMS, Bluetooth or WiFi.
Under Amobee’s new approach, advertisers only pay on a performance basis each time a mobile user interacts with the outdoor media, whether it’s a billboard in a subway, a sign at a bus stop, or a poster in the lobby of a movie theater.
In recent months, the company had completed campaigns in major cities such as New York, Boston, Sydney, London and Cape Town, attracting Fortune 500 advertisers like Nokia and Orange/France Telecom.source

Video Call Based YouTube Uploads

At the VAS India conference last week, Jai Maroo, Director, Shemaroo Entertainment, said that the company is demoing a YouTube upload service with two partners: a user can make a video call, press * to record a video, and press # to upload it to YouTube; the service would require users to connect their YouTube account with their number, and the video, once uploaded would automatically be tagged with their mobile number.
Maroo made this point in the context of an underlying debate on packet switched (data access) versus circuit switched (point to point, call based) serving of videos on 3G, saying that one should not underestimate the importance of making access and delivery of services easy to use; his take was that the circuit switched delivery of content is significantly easier to use than packet switched. “Packet switching has advantages: there’s no call drop, works with multiple bandwidth speeds, and is better in the long term. But in terms of the user experience, circuit switching or video calling is much easier to use versus WAP. I think video calling wil be a key factor in driving adoption of 3g, because its simple,” he said.
What will drive 3G VAS adoption?

- Simplicity of access and navigation:
Apart from video calling, apps will play a key role, since they allow you to customize the user interface in a manner that WAP cannot.
- Content: not just any content, but time-relevant content. Also, ‘content which you can’t watch in your living room’: Maroo mentioned the rise of channels like UTV Bindass in two-TV households, “which have shows that people are hungry for content, which they can’t watch in their living rooms. That will work on mobile. You need a slew of services. If there’s one thing that the Internet has taught us, it is that there is no one size fits all. Everything coexists and drives adoption.” Shemaroo services 27 languages in audio.
Notes from Maroo’s Talk:
- The challenge for 3G according to Maroo is that there’s no national player, and there are network issues on the technology front: the 3G rollout has not been smooth.
- On the content side, there are new rights issues – some of the content doesn’t have mobile rights.
- TV producers will have to decide whether they modify their programming to suit mobile, or launch a separate feed for mobile. Are people going to see on mobile what they see in a movie theater? Not really.
- Symbiotic relationship between TV and Mobile: Take american idol, mobile by itself does not build that kind of brand, while on the other hand TV drives traffic to mobile, which builds stickiness, and that builds mobile. 24 launched mobisodes that filled the gap between two episodes of a weekly TV show. The BBC modifed the direction of the story on the basis of what people are watching.source

Internet Users Doubled in 2010

Only 2.5% of total mobile subscribers are using mobile internet services according to the data provided by the Georgian National Communications Commission.  
According to the same data, the total number of mobile internet users was 445,489 as of 2010, out of which 417,640 subscribers were using GPRS internet, 19,656 - WAP/GPRS service and the remaining 8,193 were using HSDPA internet service.
 
The figures of mobile users have doubled compared to the year 2008 when total mobile internet service users were 215,701. The figures increased in 2009 - reaching 284,633 subscribers.
 
The total income from mobile internet service reached 3,773,588 GEL as of the first quarter of 2010. Total income exceeded 14 million GEL in 2009 and 12 million GEL in 2008.
 
As representatives of telecommunication companies said, the demand for mobile internet has doubled during the past two years especially.
 
“Bali is really now a dating service, if you really look at what the kids are doing with Bali they are spending more time on the internet than they are on the phone, so what we find is that we have invested a huge amount of money into our date network and we are constantly upgrading it, we are finding that young people are now using dating services more and more. It used to be SMS, but now it’s facebook, and email, chat, basically using your telephone as a computer,” said David Lee, General Director of Magticom.
 
Beeline told the FINANCIAL that demand for mobile internet approximately doubled during 2010.
 
“Demand for mobile internet has rapidly grown during the last few years, especially in the last 2 years. It is related to growing tourism infrastructure, because it is not possible to find access to fixed internet (ADLS, fiber optics, etc) everywhere, the only way to connect to the internet is via mobile phone,” a Beeline spokesperson told us. 
 
More than 20% of all Beeline subscribers use the internet on a regular basis.
 
The majority of mobile internet users are the teenage and middle aged segments of the population, basically surfing social network pages and checking emails.
 
“The reason for increased demand for mobile internet service is mainly the vast availability of the mobile networks, and subscribers’ demand for mobile services such as email and surfing ability on-the-go,” declared Irakli Lobzhanidze, Marketing Manager at Magticom.
 
As Lobzhanidze added the most surfed web pages are social networks such as facebook, internet search sites and mail.
“People have started to travel all over Georgia. Not only the local population needs internet access, but there are a lot of tourists coming to Georgia who use the internet even via Roaming. As well as that, business is expanding and internet connection is now needed not only in the main cities, but also in the more remote regions in the country. In parallel such community sites as facebook, Odnoklassniki and Skype which tie customers together so strongly have all become so well established, that the majority nowadays can’t live without using the internet for communication,” added Teona Bagdavadze, Beeline spokesperson. source

300,000 subscribers opt for MNP in North India

The northern region of the country comprising Jammu and Kashmir, Himachal Pradesh, Punjab and Haryana has seen a significant jump in the number of subscribers requesting mobile number portability (MNP) since the initial launch of the service in Haryana on November 25 last year and which was later on extended to the rest of India on January 20.
According to the data collected from the Telecom Regulatory Authority of India (Trai), there has been requests from nearly 300,000 subscribers till February 2 from the northern region, while 1,350,000 subscribers have requested to avail the facility across India.
According to the data, Haryana is the frontrunner with 212,000 requests followed by Punjab (75,000), Himachal Pradesh (9,000) and Jammu and Kashmir (500). Insiders feel, in the coming days the figure might witness a quantum jump in Punjab and other states.

It is worth mentioning that Punjab has the highest telecom density. The state has a telecom density of about 80 per cent as compared to the national average of 65 per cent. Further, Punjab recorded over 21 million telecom subscribers, Haryana (about 17 million), Himachal Pradesh (seven million), Jammu and Kashmir (about one million) up to December 2010.
MNP allows users to change their service provider while retaining the number. In northern region, Syniverse Technology has been given a license by the department of telecommunications (DoT) to implement MNP.
According to experts, the requests will increase significantly in the coming months. Further, the service will increase competition between providers to improve their service, they feel. Also, in order to retain the prospective customers, the service providers are offering new schemes to retain clients.
However, consumer organisation revealed that many subscribers were finding it difficult to switch operators under the new MNP scheme.
Speaking to Business Standard, Chandigarh Telecom Subscribers Association President and Telecom Consumer Education & Protection Fund Member Randhir Verma said, “The actual number of subscribers who have requested for MNP would be much more than 13,50,000. We are getting complaints from the subscribers about the leading operators not generating the UPC number, which is a must for accessing MNP, besides other problems. We are going to take up the matter with Trai and Telecom Enforcement, Resource and Monitoring (TERM) Cells.”
To avail of the MNP service, a mobile user has to pay a porting fee of Rs 19. The user has to send a message to 1900, following which he gets a unique porting code. With this code, the user can fill a form of the new service provider. The process is expected to be completed in seven days.source

Sunday, February 6, 2011

Catch Live Concerts On Your Mobile Phones


On February 9, music composers Vishal Dadlani and Shekhar Ravjiani are set to bring the first ever concert that will be streamed live to your mobile phones and PCs. The duo has collaborated with Hungama, Nokia and Airtel for the live mobile music concert for Airtel’s Talk2Me platform and a live web telecast on www.bollywoodhungama.com.
They are the first musicians ever to do a live concert that will simultaneously play on mobiles and the internet. “I don't know of any music show that reached to audiences over mobile and web only,” said Dadlani, adding, they were considering a series of mobile and web concerts in the near future. “Digitisation of music is already happening. Artists have to think ahead of pirates and deliver their content to users directly.”
Vishal and Shekhar are ready to do what they otherwise would not have done at a live concert, with the physical presence of thousands of music lovers. “We will keep a laptop on stage and perform songs that fans request us to perform over the mobile and web medium,” said Vishal.
Airtel’s Talk2Me, a platform for customers to dial, connect and interact with their favourite stars on a real-time basis, charges users a one-time registration charge of Rs 15 and call charge of Rs 2 per minute. The concept was as simple as dialing a number, listening and requesting the music director duofor songs, said Airtel.
The show is expected to be an hour-long event, where mobile subscribers can request songs to be played using the Talk2Me platform, a service that can be availed of by over 200 million Airtel customers.
Shireesh Joshi, chief marketing officer (mobile services), Bharti Airtel, said: “Not limited by location, mobile concert on Airtel will offer unique experience to our customers.” Viral Oza, head (activation, media, online sales and marketing) at Nokia India said: “With more and more young people listening to music on their mobile phones, this unique initiative is very timely.”
But, since it would be a concert on the web and mobile platforms, what would be the quality of sound? Will it be as enjoyable as watching a live performance? “We are confident that with the line-up of performances planned and the technology support, the experience will be seamless. As for the sound, since the performance venue is indoors, with just a handful of audiences in the studio, the quality will be maintained for the virtual audience,” said Dadlani.
Over the internet, Hungama, along with Nokia, will telecast the show as a ‘webcert’. Hungama COO Siddhartha Roysaid: “The last webcert we did on our website www.artistaloud.com was for ArtistAloud.com, where a band called Swarathma performed on January 18. The event witnessed over 18,000 people participating. But we expect the numbers to be even bigger this time as Vishal and Shekhar are mainstream music directors.”
Hungama, according to Roy, is exploring more such mobile music concerts. “While on web, we intend to keep the concerts free or mostly ad-sponsored, on the mobile, this will be a premium service as users get the chance to request and interact with the stars during the concert.”
Hungama believes, while web and mobile concerts may be a new concept, but their popularity is bound to rise quickly as youngsters are keen to experiment. “For those who can’t make it to live concerts, the web provides a platform to enjoy the experience within the comfort of one’s home or the workplace,” said Roy.source

Mobile World Congress 2011


Amdocs Showcases Solutions to help service providers do more in the connected world. 

Click Source to Read The Complete News- source

Movement From Voice to Data in INDIA


The question telecom experts are debating today is at what speed will the Indian consumer move from voice to data
All telecom experts today agree that Indians will increasingly start using mobile broadband services — on their smart phones, their netbooks, and their tablets. The question to which the telecom titans do not have any answer is which technological route the majority of Indian consumers will take to access mobile broadband. Will it be the 3G services being offered by the big GSM boys like Bharti Airtel, Vodafone or Idea? Or will they adopt evolution video data only (EVDO), the high speed data being offered by CDMA networks like MTS or Tata Teleservices? Or will they completely switch over to long-term evolution (LTE) technology — the 4G technology through which Mukesh Ambani wants to re-enter telecom.

That is the multi-billion dollar question. Multi-billion dollar because different players in the Indian telecom arena are betting those amounts on their chosen technologies — and hoping that they will be able to persuade the Indian consumer to choose their technology over the ones their rivals are offering.
This story actually started a good 15 years ago. In July 1995, when the first mobile phone call was made in the country from Kolkata, no one had dreamt that this would alter the communication landscape in the country forever.
At over Rs 40,000 for a handset and equally expensive talk time, mobile communication was a privilege that only a select few enjoyed and many aspired to. But as service tariffs crashed and phones became affordable within a few years, a wave of consumers, tired of waiting in queues to get a fixed line phone connection, embraced mobile communication with great alacrity. And a communication revolution was well on its way.  
MATCH POINT
PLATFORMSPEED
GSM9.6 Kbits/sec
GPRS40 Kbits/sec
3G1.8-14.4 Mbps
EVDO 3.1 Mbps
LTE 50-300 Mbps
Note: Actual speed could be much less depending on towers and number of customers
Eight years on, in 2003 to be precise, Mukesh Ambani tried to change the rules of the game by urging customers to shift from just making voice calls on the mobile phone to using data and internet on his CDMA platform. And he tried to do so through aggressive pricing. As part of his much vaunted “Monsoon Hungama” scheme, customers had to pay Rs 500 to lay their hands on a mobile phone bundled with data freebies like streaming television programmes, downloads of movie video clips and music and games to name a few.
The magic worked, but in part. Ambani did manage to rope in millions of customers. But his strategy to bring about a data revolution on the CDMA mobile platform, which would give him 30-40 per cent of his revenues, failed to take off as he gave away his telecom venture to his brother Anil after a bitter family battle.
As it turned out, for the bulk of the customers it was voice that reigned supreme. And despite over a dozen-odd mobile players in the market, real data services (excluding SMSs and caller tunes) currently contribute a mere 3 per cent to a telecom company’s revenue.
Game for more So did Mukesh Ambani misread the market? Or was he ahead of his times? In 2011, no one is asking those questions or doubting that a second revolution in telecom is well under way — with mobile broadband data ready to sweep customers off their feet. Telecom companies realise that voice is just a commodity in which margins will be under pressure. In such a scenario, the only way to arrest the decline in average revenue per user (ARPU) is to hook consumers on to data. Given that, the debate today is largely about the speed at which Indian customers will move from voice to using data on the mobile.
The change could be dramatic. Customers will soon be spoiled for choice with as many as eight operators offering them an array of technological options — 3G, 4G, LTE or EVDO — to get high speed broadband on their laptops and phones. At average speeds well above 2 mbps — nearly four times faster than what you are used to — consumers can watch live TV, make video calls, download music, make bank transactions and commercial deals, get online education lessons or discuss their problems with doctors sitting in another part of the country. Says Kanwalinder Singh, president of Qualcomm India, a key player offering technology for mobile broadband, “A data revolution, just like the voice revolution some years ago, is set to break out in India.”
More importantly, for the first time the gap in mobile technology offered by Indian companies and those abroad will be bridged completely. While customers in the country are at least four to five years behind in savouring 3G services, Indian telcos are expected to roll out 4G operations within a year of its global launch.
There are worries nonetheless. One, that the 3G services would be expensive as operators have paid staggering amounts for the spectrum — a total of Rs 67,000 crore. But if the tariffs offered by Reliance Communications and Tata DocoMo — players that have started offering services — are anything to go by, the fear seems misplaced. In fact, data tariffs that have been bundled with voice are highly affordable and even cheaper than 2G offerings for those who have higher ARPUs. The two operators have been able to rope in over two and a half lakh 3G customers in the first month of their operations despite that some killer services like video calling had not been activated for weeks due to security issues.
By October/November some of the broadband wireless access services (BWA) licensees are expected to offer 4G services through LTE technology which promises even faster data speed to many more consumers.
With Mukesh Ambani back in the game with a pan-India licence and spectrum for BWA, observers say he just might kick off another price war in the mobile data space like he did in voice in 2003. He will be at an advantage over his 3G rivals — he has got more spectrum (20 MHz) than his GSM 3G rivals (5 MHz) and at a cost that is fraction of what his rivals have paid. But he has a problem as well: The technology that he proposes to use is still under commercial deployment in some parts of the globe and its efficacy is yet to be tested unlike 3G, which is well established and has a large consumer base.
Still, to add to the good news for the consumer, if the telecom regulator and the government are able to push through things, there will be more spectrum available for auction next year for 4G services and another three to four operators can easily jump on to the speed bandwagon. Last but not the least, CDMA players like MTS are dramatically shifting their strategies by moving out of mobile voice services and pushing for data by offering EVDO dongles at high speeds that match those of the 3G players.
To make the data revolution a reality companies are together investing over Rs 1,50,000 crore. And they are doing so because they are sure there is a large market waiting to be tapped. Says Ericsson India Vice-president P Balaji, “In the next three to five years there will be a data market of 300 to 350 million subscribers. And we will see revenues from value-added services, which stand at 10 per cent currently, go up to between 25 and 30 per cent.”
Supporting the effort are device makers offering larger screens to push mobile data at affordable prices. So as Apple’s iPad made an official launch in the country last week, Samsung dropped the price of its Galaxy Tab to an attractive Rs 29,000 from a steep Rs 38,000 earlier.
Falling prices Will broadband wireless be dominated by GSM players like Bharti, Vodafone, Idea or Tata Teleservices that already have a large subscriber base? Or will the market be led by Mukesh Ambani who has no legacy issues or subscribers but a new technology that offers more speed than 3G but needs to be tested across the world? Or will it be won by incumbent CDMA players like MTS, which have the advantage of a pan-India network that others would take years to build?
LTE players have one key advantage — more spectrum at less price compared to their 3G rivals which helps keep costs lower. Says Kanwalinder Singh: “What this (more spectrum) means is that you can offer broadband to a larger number of people at speed similar to that of 3G but at a more affordable price because of the bigger volume of customers. Also it is possible for an LTE player to install a pan-India network with nearly half as many towers as would be required for 3G. And one can do that quickly by just leasing out capacity from large tower companies that have spare capacity rather than build it from the scratch.
But they also have many disadvantages — mobile devices on LTE are still not available around the world and most telcos are offering only dongles. Also consumers looking to use the device for voice won’t be able to do so. Until, of course, government changes policy and allows voice over internet protocol telephony between a PSTN (public switched telephone network) network and a LTE device. Currently, only device to device internet calls are allowed.
More importantly, prices of LTE devices, unlike 3G phones, will be steep — as high as Rs 25,000 which would be out of reach for most customers. In contrast prices of 3G devices are falling. Qualcomm, which makes 3G chipsets, is already working on smart phones below Rs 5,000. For sub-Rs 5,000 3G feature phones with speed of 3.2 mbps, Qualcomm has joined hands with companies like Micromax and Spice Mobile that offer such products.
Qualcomm’s Singh says that with more operators going in for LTE, the price of such devices should fall to, say, Rs 13,000. Also companies like Qualcomm are working on chipsets for mobile phones in which you can move seamlessly from 2G to 3G and LTE. The expectation is that the 5 MHZ spectrum with 3G operators is not enough and there will be congestion in such networks within a few years if not months. So 3G operators might have no option but to tie up with LTE operators especially in larger cities so that they can offer their customers high speed data services without a glitch.
Winners & losers But GSMA operators say they have at least a two-year head start over the BWA players. Says Samaresh Parida, strategy director at Vodafone-Essar, “BWA on LTE is still some distance away.” More importantly, they also believe that with more spectrum expected to be available in 2012 for auctioning in 4G, BWA players will cease to enjoy any special advantage.
3G operators are already honing their strategies to woo customers. Parida says that one large market which they will tap for 3G comprises PC users — over 35 million who use either laptops or desktops. It is also the market which Tata Teleservices is planning to concentrate on in the belief that at least 60-70 per cent of the initial revenue in 3G will come from dongles. Most of the dongle market is currently in the gri  ps of CDMA players as GSM was not able to offer high speeds in 2G. But with 3G that has changed. To top it all, prices for dongles are sliding — it has crashed from Rs 5,000 to Rs 2,500 already.
Vodafone-Essar’s Parida says new markets will open up — one such comprises customers who want to use 3G devices but communicate in their regional language. With phone devices now available with virtual key boards on the screen, it’s easy to create key boards in different languages.
But 3G players are already facing a tough challenge from CDMA players who are increasingly shifting to data. Sistema Shyam which sells under the MTS brand, for instance, has dedicated half its spectrum to data and is pushing sales of EVDO dongles rather than just go for voice. The strategy is clear, says Vsevolod Rozanov, president and CEO of company. “Currently 10 per cent of our revenues come from data; we expect that to go up to 25 per cent by the year end. We have 4.5 lakh dongle customers already.”
Can he take on 3G operators? Rozanov says that he might not have the 3G spectrum but that does not bother customers because he ensures he offers them similar average speed. He also points out that he is well ahead of his 3G competitors in terms of network roll out. “We have four times the number of BTSs (base transceiver station or cell site) that 3G operators have. It will take competitors time to build a similar pan-India network.” Plus he is now coming up with MTS-branded smart phones which will be within Rs 5,000 for customers to do data on the move.

Surely, for mobile operators facing margin pressures, data revenues could change the game in 2011. And for Indian consumers the mobile data revolution could fundamentally alter the way they live and work.source