Wednesday, 6 July 2011
Mumbai: Animation has come a long, long way since the first public screening of animation with cinematic apparatus that used hand-painted sequences on celluloid strips. Today the global market is worth about $50 billion and is projected to become a $70-billion industry by 2007.
The Indian animation segment traditionally owes a lot to the advertising and TV fraternity where TV commercials and brands accepted character illustrations like The Amul Girl, Gattoo (the Asian Paints mascot), The Handiplast Boy, The Bata Bubble Gumme, 30-second ''animercials'' for brands like Hutch, Amaron, Orange, All-Out Mosquito Repellent, 7-Up, Kellogg''s, ICICI, Morten, Good-Night and Vicks. This proves that animation is now an acceptable medium to convey brand properties and values.
The studios were competitors to each other in their home country (like in India) but projected Korea as a major outsourcing hub (unlike in India). This ensured that Korea as a country had a better chance of grabbing business than any other individual entity working in isolation.
Turner International''s Cartoon Channel is currently telecasting episodes of Adventures of Chota Birbal while a mainstream entertainment channel has commissioned Bheema Kheema, India''s first 52-episode series for children to be aired from mid-February 2004.
Get our IT Act Together
24.December.2004
Well intentioned cyber laws are only as good as their subsequent intrepretation and implementation.
Well intentioned cyber laws are only as good as their subsequent intrepretation and implementation.
The noise and colour of an Indian shaadi(wedding) brass band, more or less, describes the events of the last few days. That the law is an ass, in the case of Baazee.com, a 100 per cent Indian subsidiary of eBay - the world's largest online marketplace - is in some danger of being proven so. Except, in this case, the law is fairly robust; it is its interpretation and style of enforcement that is asinine!
Baazee was in the news recently on account of a rather profitable valuation and subsequent acquisition by eBay making its shareholders both happy and rich! Reportedly at $50 million for a subscriber base of just about 1 million registered users… the largest dotcom deal after the sale of IndiaWorld (Sify) to Satyam at the height of the internet boom No doubt an isolated case of an Indian dotcom success in today's post internet bubble world, but much needed success nonetheless. So what are the issues which have bought a fairly open and shut case to such prominence?
First, as everyone knows, an auction or marketplace site is much like a mandi, bazaar, stock exchange or flea market except that it has no physical boundaries. It is virtual and almost anybody in the world with an email id and internet access can participate by just registering and listing the product description of what they want to sell - not the product per se!
So in this case. It was not the 'objectionable' "DPS (Delhi Public School) clip" that was found on the site, contrary to what is reported in most media, but just an innocuous text description of the item.
Second, trading sites are fairly self-regulating. While anyone can register and transact, all buyers and sellers rate each other based on feedback on the reliability and trustworthiness of their transaction experience. The site, unlike the local kirana wallah (grocery shop-owner) neither 'owns', 'creates' or 'publishes' the product nor is necessarily aware of what passes through their site since there are literally millions of transactions taking place at any point of time. If one types the keyword "DPS Dhamaka" on the world's most famous search engine - Google, the results throw up links to sites actually containing the infamous clip! Baazee or Google, Inc as 'intermediaries' are in no practical position to pre-emptively control what is available on their sites nor act as moral gatekeepers. In short they have limited responsibility.
Second, trading sites are fairly self-regulating. While anyone can register and transact, all buyers and sellers rate each other based on feedback on the reliability and trustworthiness of their transaction experience. The site, unlike the local kirana wallah (grocery shop-owner) neither 'owns', 'creates' or 'publishes' the product nor is necessarily aware of what passes through their site since there are literally millions of transactions taking place at any point of time. If one types the keyword "DPS Dhamaka" on the world's most famous search engine - Google, the results throw up links to sites actually containing the infamous clip! Baazee or Google, Inc as 'intermediaries' are in no practical position to pre-emptively control what is available on their sites nor act as moral gatekeepers. In short they have limited responsibility.
Third, a detailed mandatory user agreement between the user and the site further protects the service provider and defines what is not allowed to be listed (viz. objectionable material, pornography, weapons, drugs, etc,) and what indeed constitutes breach of this agreement and penalty for being in breach. This includes barring a subscriber from access and even being brought to the notice of the 'cyber crime division' of the local law enforcement agency.
Situations which could fall under a similar dilemma in the real world are where a newspaper editor or publisher cannot be quite held directly responsible, under existing legal jurisprudence, if their classified section carries fairly 'explicit' ads of massage parlours or escort and dating services.
Similarly in the digital or electronic world, if subscribers send objectionable text, voice or multimedia material over the net, mobile phone, telephone lines, Wifi- or Bluetooth-enabled devices then can the local telephone company, internet service provider or spectrum licensees be held directly responsible?
In such cases, the spirit and principle of section 79 of the IT Act ought to kick in and restrict the direct liability of the service provider (unless or otherwise clearly proven that the site or "intermediary" knew about it or did not exercise all due diligence to prevent the "offence").
Fourthly, in its currently strict interpretation of section 67 of the IT Act (electronic transmission and / or publication), the Municipal Corporation of Delhi (MCD), under the jurisdiction of which is the Palika Bazaar, the telecom company on whose network these MMS's were sent, and the director of IIT, Delhi where the images were found stored, stand implicated.
Had baazee failed to pull out the objectionable material, the police would have been perfectly right to enforce the law. Clearly, from all accounts baazee took of the offending listing within 48 hours of its listings and much before the law even got to know about it… mainly on being alerted by its online self-policing 'watchdog' feature.
Recently in the UK a member of the Queen's Household was dismissed from service for listing the Queens X'mas Gift to him - a $10 X'mas Pudding cake - up for auction on eBay! Needless to say, there was no question of anyone being hauled up from the site, let alone arrested. So what is the reason for the rather over-the-top reaction by all concerned here?
There has been a sudden spate of raids all over the country on cyber cafés, seizing of mobile phones, random checking of SMS / MMS of students, emails of actresses, etc, ever since. Unfortunately since the IT Act of 2000 has been passed there has been no sensational case which has come up and therefore, by all counts, this is a test case since there are only a few in the enforcement and legal fields who are familiar with the nature of the internet and modern communications technology and cyber laws which govern them.
It is obvious that however well intentioned the law, it is in the interpretation that there is going to be a veritable free-for-all till wiser counsel prevails!
Finally, the internet services "intermediary" community, as small as it is here, is largely underrepresented and fragmented with little or no spokes-person, body or special interest group to promote and protect its cause. To that extent the internet business in India though admittedly regarded as a child protégé, alas, is one which has been orphaned at birth. The little representation caters to motley interest groups and their limited charters and agendas. It is time for someone to step up to the plate.
Regulation of the internet will remain a Pandora's Box
The internet cannot be regulated the same way as newspapers, magazines, films, radio or television. By Probir Roy
02.February. 2005
IT Act I; scene 2 now unfolds after a very private act, which set off a very public storm. The Baazee school-sex MMS episode left an aftermath of a flurry of raids on cyber cafés, seizing of mobile phones, random checks of students'' mobile messages, scrutiny of an actress''s emails, and a generally heightened awareness of the threat of intrusion of hidden web cams and camera phones in people''s daily lives.The government has moved quickly — it has set up a committee to suggest modifications in the five-year-old IT Act. This provides as good a time as any to take a step back and revisit the caveat-driven nature of the web.
First, the internet is the manifestation of humankind''s quest for limitless personalised two-way ''rich'' interaction with thought. At a point-and-a-click, the hypertext layout allows users to change topics on a whim, travel to distant places, gather world opinion or information on a subject in a matter of seconds, engage in digital trade and commerce and help in medicine and education. This nature of the internet must be protected and perhaps even promoted by any legislation that claims to be fair to this medium.
Legislation that seeks to concurrently regulate the internet must continue to recognise the unique and ubiquitous nature of the medium. The internet is not like the print medium, the communications infrastructure industry or the audio and visual entertainment industry. It is all, yet none of these! To paint it with the same law brush, tempting as it may be, or indeed even look for parallels in these sectors, is short-sighted. This has been proven in other parts of the world.
The interaction between ''receiving'' data and ''publishing'' it is where the core of the law and its interpretation should focus at this point. What is clear is that each side has its rights; the online publisher has freedom of expression and the receiver has the right to be secure from harm in his electronic space.
In a Baazee-like case, it is a tightrope walk — while direct publisher or distributor liability may not be clearly established, clever legal arguments and overseas rulings may not absolutelyexclude it either. A recent case in which an ordinary corporate website carried advertising on a subject matter in violation of the provisions of the pre-natal sex determination law, direct liability could be attributed to the company on account of inadequate due diligence having been exercised by it.
What of the proliferating web journal, Blogger-community, which has suddenly given power to anyone with an email id and a the ability to put down words on a screen to become both an electronic ''publisher'' and ''distributor''?
Provisions of law that attempt to give one side or the other an unreasonable burden in conducting its business are doomed to failure. Certain definitions and provisions of the Cyber Act 2000, in their current form are clearly limiting or burdensome. Anyone who has studied economics will endorse that the internet is a ''flow'' — an evolving medium in a 24x7 flux to find form, yet at loggerheads with it.
Laws on the other hand are ''stocks'' and lag behind, never able to anticipate those which they vainly attempt to govern. A good example are our ISPs, who had to rollback their VPN services launched in the late ''90s (which account for a dominant part of their revenues) on account of policy retrofitting done only in December 2004.
Over-enthusiastic or inadequate use and interpretation of sections 67 and 79 could have a bearing on direct responsibility and liability issues affecting evolving interactive service intermediaries such as web logs, search engines, newshopper, mobile value-added service providers and even mobile virtual network operators.
Notwithstanding the ambiguity of privacy laws in general in India — as applicable under Article 21 of the Constitution — is that cyber laws must not hint at censorship or impinge on the basic right of speech and expression. They may regulate the labelling on the ''packaging'', but never the content.
Till recently, major US mobile carriers offered adult content as a premium service, till they voluntarily withdrew it, even though US regulations preclude service providers from acting as content gatekeepers and censoring content in any way. And what of some news sites being subpoenaed to reveal their source of information! Clearly the same ''standards'' don''t seem to apply in the real world.
The foundation of the internet rests on the bedrock of technological innovation. Therefore, while technology is clearly the enabler, it is also keenly limiting and can impact current interpretations of due diligence. Talk about monitoring and regulating content on the net through the use of advanced technology and methods like filtering, labelling and rating, have been in vogue at various points of time. Given the varied technical nature of the protocols involved, it is likely that filtering tools will do very well with some of these, and extremely poorly with others.
For example, filtering software can easily block access to newsgroups with names like ''alt.sex''. However, no technology can identify the presence of sexually explicit images in a file that''s being transferred. Keyword-based blocking, as used by Baazee or by MSN''s blogger service (MSN Space), uses text searches to categorise data. If a posting or site contains objectionable words or phrases, it is blocked. Yet any internet buff knows that, at best, keyword searching is a crude and inflexible approach that is likely to block sites that should not be blocked while letting ''adult'' content pass through unblocked.
Searching and filtering has two key shortcomings: First, keyword searches cannot use contextual information. Searches can identify the presence of certain words in a text, but they cannot evaluate the context in which those words are used. For example, a search might find the word ''breast'' on a web page, but it cannot determine whether that word was used in amurgh masala recipe, an erotic story, or in an scientific piece on infant nutrition.
Second, keyword searches cannot interpret graphics. It is not currently possible to ''search'' the contents of a picture. Therefore, a page containing sexually explicit pictures will be blocked only if it is accompanied by text on the same page as the picture and the page contains one or more words from the list of words to be blocked. Ratings systems, on the other hand, imply making value judgements to categorise various types of content. Users are limited to choosing between a small number of ratings systems, each of which has its own biases and viewpoints.
The origin of the internet was found in defence programmes at DARPA in the ''60s. But its 21st century progeny in the avatars of ''darknets'' — anonymous service providers; underground P2P networks (which operate at the fuzzy edge of institutional acceptability) — and proliferating ''Blog services'' will have rule makers of any ilk scratching their heads long into the future. So, whether the wise men in recently constituted committees and groups really have the measure of key issues at hand or vice versa is something one hopes to track and keep readers of this column informed.
Wednesday, 22 June 2011
Wireless spam: self regulation is better than super legislationnews
Due to a heterogeneous mobile network system, a high penetration of mobiles and emerging third generation wireless data networks, a large number of us will sooner than later have conveniences such as high-speed multimedia, video conferencing and computing literally at our fingertips. However, mobility while creating the magical illusion of being footloose and fancy-free also brings its own nuisance value.
The filing of a recent PIL in the Supreme Court of India against unsolicited voice calls to consumers by telemarketers is just the beginning.
Current IT law, as one is being reminded by numerous sensational exposes, does not quite address data protection and concomitant privacy issues (the cause of unsolicited marketing or spam) beyond those associated with the immediate concerns of the lucrative back office business viz. tampering, hacking, and damaging of computer data and systems.
For starters, spam - wireless, phone or internet - needs to be covered by fresh data protection and privacy provisions as suggested by a recent government committee. This can be simply addressed by making it mandatory for marketers to not use or disclose non public information for any kind of digital marketing to a third party without the prior consent of the customer.
As early as two years ago at a well attended seminar convened by the author under the auspices of the Indian Merchants Seminar (IMC), Mumbai, mobile marketing was hailed as a new and lucrative market created by technological advances. At the next level, it was envisaged that at some point wireless advertisements in the form of emails and mobile imagery delivered to cellular phones would offer consumers time and location sensitive information. For the past several months now there has been a sudden proliferation of three and four digit short codes registered by celcos, media companies, savvy cellular telemarketing companies, along with the ubiquitous 10 digit numbers often used for voice and SMS-based solicitation by ghost marketers.
These marketers and cellco service operators, sensing new revenue streams through retailing bulk SMS to various short code marketers and media companies at premium prices for promotions, loyalty programmes, feedback, reminders and alerts, quizzes, voting, lottery, launches, contests and premium entertainment and information have led to a glut of intrusive communications.
Subscribers, however, view this new form of marketing as more of a nuisance and intrusion than the promises and methods employed by these digital solicitors. Clearly, those behind this innovative form of marketing have once again failed to consider a possible backlash as being akin to 'stalked' by marketers.
Evolving technological innovation will continue to drive opportunities for spam. Modern-day bandwidth management enables spectrum owners to optimise between voice and data traffic and increase 'data' throughput per second. While voice traffic has reached critical mass, operators will aggressively look for data and other bandwidth-hugging value services to get more bang from their bandwidth buck.
Also, operators will continue to look to derive further value from the simple text-based SMS, rather than its advanced counterparts like MMS and location based services (LBS). While legislation is one sure fire way to protect consumer interest, in an over legislated country (with a dubious enforcement record) sensible self-regulation by marketers from an early stage can easily bring about the desired result.In 2002, Japan and the European Union (EU) did put together legislation covering wireless spam, both choosing the 'opt-out' approach for internet and cell phone-based advertisements - which means that marketers could continue to send out wireless messages until one objected. This, complemented with direct marketing industry's self-imposed 'dos and don'ts', has given consumers in these countries the option to either opt-in or unsubscribe. While 'opt-in' or 'pull' based marketing is the approach in the US, the EU takes the more sanguine opt-out or 'push' route endorsed by their direct marketers association.
Rather than let the mobile operators act as guardians with their recent introduction of blanket blocking services, what is the way forward?
The solution before being consigned prematurely to the dust heap of marketing's tired and dumped (b4 prmturly consigng m mktg 2 dst heap of mktg's tried & dumped) is for marketers themselves to quickly adopt a code of practice like their counterparts elsewhere in the world.
This would be designed to rest on the principle of soft opt-in ie permission market to those whose details have been picked up in the course of a commercial interaction (not necessarily resulting in a sale) but at the same time giving them an option to exit any time.
This puts freedom of choice back where it belongs - in the consumers hand or fingertips in this case. They can then set the ground rules as to whether, whom and when to interact with. This approach would not only help promote the fledgling direct marketing industry by giving a fillip to mobile marketing and its potential for high RoI as compared to traditional direct marketing, but also protect ordinary consumers.
The alternative opt-out approach allows marketers to send unsolicited SMS to individuals from rented or ad hoc databases until they specifically object! Unfortunately the 'unsubscribe' option in a caller-pays mobile environment comes at a premium cost to the customer, as he would land up being billed for every 'Nay'!
*(The writer is a well known IT expert and Member, Indian Merchants Chamber National Technology Committee. The views expressed are his own.)
Let the mobile pay
Mobile shopping in India takes a bold leap forward with the deployment of the first SMS-based mobile payment service. ByProbir Roy, co founder Coruscant Tec.
Wireless has been one of the most quickly adopted technologies in the world, beating even internet adoption. More so in India where the wireless universe is perhaps more than fixed line phones, C&S, internet and radio. Certainly more than the last three combined. And by end 2007 – more than all of them combined.
Wireless has been one of the most quickly adopted technologies in the world, beating even internet adoption. More so in India where the wireless universe is perhaps more than fixed line phones, C&S, internet and radio. Certainly more than the last three combined. And by end 2007 – more than all of them combined.
Imagine a world where a single device can cater to your communication, entertainment, lifestyle and commercial needs. The proverbial 'third screen's has become the ubiquitous screen of first choice for most people – from just voice, the mobile device has evolved into a multi media and entertainment device, and now as a payment device.
Making transactions with the mobile device otherwise known as mobile payments has always been the ultimate dream for vendors, operators, service providers and financial institutions but has been ridden by many false starts and hype. Globally the industry has split over operator-controlled payments, in which content providers are paid an insignificant share of the sale price and more often than not with a delay of over 270 days.
Some claim that the operators, who tend to act more like 'banks' rather than payment facilitators, are indeed holding the industry back to the point of stagnation. Today we are on the cusp of yet another payment revolution – a heady cocktail of the simple and humble SMS paving the way for "one click" shopping and transaction. No GPRS, no new SIM card or fancy phone or indeed a paid and complicated multipoint registration process.
PayMate, recently launched by an Indian company, PayMate India Private Limited, an m-commerce venture funded by leading global VC Kleiner Perkins, has been developed to serve as a fast, efficient and secure method of conducting such commercial transactions. There are various projections as to the market size; recent numbers by the Informa Telecom & Media Group have estimated the m-payments market in 2006 at around $60 billion, which is estimated to rise up to $180 billion in a few years. Needless to say China, Japan and now India would be the geographical drivers.
PayMate is a cutting edge mobile payment solution that seemingly allows mobile subscribers to make payments for merchant services for travel, entertainment, lifestyle, and shopping, just by using their cell phones in real time. It is connected to merchants and banks to enable such transactions. Keeping in view the three principles upon which this is built - ease of use, convenience and security, the mobile phone and PayMate could soon eliminate the need to carry a heavy wallet with an array of credit cards and various plastics. The fear of disclosing valuable credit card and banking information is also eliminated.
The making of this product or rather translating this idea into reality has taken the best part of over two-and-half years. The last mile – involving months of testing, integration and preparation with partners such as Citibank, Euronet Worldwide and Rediff, have helped to arrive at what they feel is a product and framework for the deployment of a simple, secure, safe and interoperable m-payment system with tremendous potential in the Indian and global mobile commerce market.
Apparently this scale of deployment has not been attempted anywhere in the world. Mobile commerce has the potential for explosive growth and mobile payments are often touted as the next "killer application" for the mobile enterprise.
Indian tech moves up the value chain
Indian technology companies are not going to be just about services and labour arbitrage; they will become known for intellectual property and "productised" services.
It is a well-known fact that many of the world's great innovations have come from Asia. Inventions such as the compass, paper, as well as gunpowder and rockets were first invented in this part of the world. The first compass was invented in China 2,000 years ago and it took the West 1,000 years to start using it.
The Zero was 'invented' by Indian mathematician and astronomer Aryabhata in the 6th century but came into mainstream use in the West only much later.
It is small wonder then that the iconicRed Herring magazine chose Hong Kong as the ideal setting for recognising Asian ingenuity, feting 100 young technology companies with the prestigious Red Herring Top 100award for innovation, and the industry changing and disruptive nature of their technologies ('Oscars' for young technology companies). India and China dominated the winners list from over a few hundred companies that had sent in nominations.
India with 24 and China with 33 winning companies made their presenc felt; with India having moved beyond the usual IT services and BPO hoopla.
In an earlier piece in domain-b in 2002, I had argued that India needed to move up the value chain and become innovation-centric, rather than be the world's favourite sweat shop.
It was clear that would not happen merely by scribing a few words, sitting back and waiting for it to happen. Something had to be done about it. That something was an innovation and a paradigm-shifting product idea for the global marketplace, and its subsequent successful commercialisation. Therefore, we did it in the eclectic area of wireless technology.
On checking with the publisher of Red Herring and 'Venture Professor' Yoshito Hori on the sidelines of the show, I was told that the US continues by far to be the leader in recognition of new ideas and businesses, while Japan (with an economy half that of the US) consumes one-twelfth the venture funds. Singapore, suprisingly, accounts for 10 times as much as Japan!
Clearly, the country that has led the consumer electronics revolution for the better part of two decades, is the least innovative, measured by successful new companies and ideas coming out from there. Essentially, that is because of its none-too-friendly entrepreneurship culture and an inbuilt fear of failure borne out of centuries of a rigid and stable society.
Contrast that to India, where the flow of funds chasing new ideas, business models and markets is running at four times that of Japan, and the current MBA programme at the elite Indian School Of Business, Hyderabad (ISB), has more than half of its students enrolled at courses at the School's Wadhwani Centre for Entrepreneurship Development (WCED)! Moreover, the recent TiE-ISB Summit had over 800 delegates drawn from across the Indian diaspora.
It's a very different scenario from just 20 years ago, when Indian entrepeneurship was the preserve of longstanding industrial families and state-run companies under a controlled Nehruvian model of economy. If one were to extrapolate for a moment, and hazard a guess as to the total Indian contribution in the Global Top 300 companies chosen by Red Herringacross Asia, Europe and the Americas this year, then perhaps a good one-third would have one!
So clearly, this is a punctuation point in our experiments with a free economy. We have a new entrepreneurial ecosystem evolving by way of business schools, IITs and some other leading institutes of technology, a few government laboratories and Indiaco (India's largest private incubator), all of whom are silently nurturing innovation, entrepreneurial activity, risk taking and fresh IPs. Coupled with its overall R&D cost advantage at one-eighth of that in Western countries and a large pool of intellectual resources, India is gaining respect as a potential breeding ground for innovation. All this without much hype.
Therefore, India is now not going to be just about services and labour arbitrage; it will become known for its intellectual property and productised services. Certainly, there is a long way to go before it catches up with Israel (for a country roughly around the size of Bangalore, it has the second-largest number of companies listed on the NASDAQ, and attracts twice the amount of venture funds as Europe), but it is already ahead of Japan!
The probability of an original business idea hitting $1 billion in revenues is one in 20,000 (29 NASDAQ listed companies have hit the magical $1-billion revenue mark). Clearly the stakes are high and loaded against the everyday Joe quickly striking gold.
Nevertheless, innovation will still come out of mavericks with high self-belief, skills, focus and a nurturing ecosystem, and not out of a plethora of associations, committees or commissions entrusted with 'stewarding' innovation. The latter constructs are better suited for building Brand India on the competitive advantage of the moment - IT, ITeS and BPO.
New paradigms will entail new mechanisms to catapult them into mainstream life. Old economy constructs, like soldiers, will fade away.
It is a well-known fact that many of the world's great innovations have come from Asia. Inventions such as the compass, paper, as well as gunpowder and rockets were first invented in this part of the world. The first compass was invented in China 2,000 years ago and it took the West 1,000 years to start using it.
The Zero was 'invented' by Indian mathematician and astronomer Aryabhata in the 6th century but came into mainstream use in the West only much later.
It is small wonder then that the iconicRed Herring magazine chose Hong Kong as the ideal setting for recognising Asian ingenuity, feting 100 young technology companies with the prestigious Red Herring Top 100award for innovation, and the industry changing and disruptive nature of their technologies ('Oscars' for young technology companies). India and China dominated the winners list from over a few hundred companies that had sent in nominations.
India with 24 and China with 33 winning companies made their presenc felt; with India having moved beyond the usual IT services and BPO hoopla.
In an earlier piece in domain-b in 2002, I had argued that India needed to move up the value chain and become innovation-centric, rather than be the world's favourite sweat shop.
It was clear that would not happen merely by scribing a few words, sitting back and waiting for it to happen. Something had to be done about it. That something was an innovation and a paradigm-shifting product idea for the global marketplace, and its subsequent successful commercialisation. Therefore, we did it in the eclectic area of wireless technology.
On checking with the publisher of Red Herring and 'Venture Professor' Yoshito Hori on the sidelines of the show, I was told that the US continues by far to be the leader in recognition of new ideas and businesses, while Japan (with an economy half that of the US) consumes one-twelfth the venture funds. Singapore, suprisingly, accounts for 10 times as much as Japan!
Clearly, the country that has led the consumer electronics revolution for the better part of two decades, is the least innovative, measured by successful new companies and ideas coming out from there. Essentially, that is because of its none-too-friendly entrepreneurship culture and an inbuilt fear of failure borne out of centuries of a rigid and stable society.
Contrast that to India, where the flow of funds chasing new ideas, business models and markets is running at four times that of Japan, and the current MBA programme at the elite Indian School Of Business, Hyderabad (ISB), has more than half of its students enrolled at courses at the School's Wadhwani Centre for Entrepreneurship Development (WCED)! Moreover, the recent TiE-ISB Summit had over 800 delegates drawn from across the Indian diaspora.
It's a very different scenario from just 20 years ago, when Indian entrepeneurship was the preserve of longstanding industrial families and state-run companies under a controlled Nehruvian model of economy. If one were to extrapolate for a moment, and hazard a guess as to the total Indian contribution in the Global Top 300 companies chosen by Red Herringacross Asia, Europe and the Americas this year, then perhaps a good one-third would have one!
So clearly, this is a punctuation point in our experiments with a free economy. We have a new entrepreneurial ecosystem evolving by way of business schools, IITs and some other leading institutes of technology, a few government laboratories and Indiaco (India's largest private incubator), all of whom are silently nurturing innovation, entrepreneurial activity, risk taking and fresh IPs. Coupled with its overall R&D cost advantage at one-eighth of that in Western countries and a large pool of intellectual resources, India is gaining respect as a potential breeding ground for innovation. All this without much hype.
Therefore, India is now not going to be just about services and labour arbitrage; it will become known for its intellectual property and productised services. Certainly, there is a long way to go before it catches up with Israel (for a country roughly around the size of Bangalore, it has the second-largest number of companies listed on the NASDAQ, and attracts twice the amount of venture funds as Europe), but it is already ahead of Japan!
The probability of an original business idea hitting $1 billion in revenues is one in 20,000 (29 NASDAQ listed companies have hit the magical $1-billion revenue mark). Clearly the stakes are high and loaded against the everyday Joe quickly striking gold.
Nevertheless, innovation will still come out of mavericks with high self-belief, skills, focus and a nurturing ecosystem, and not out of a plethora of associations, committees or commissions entrusted with 'stewarding' innovation. The latter constructs are better suited for building Brand India on the competitive advantage of the moment - IT, ITeS and BPO.
New paradigms will entail new mechanisms to catapult them into mainstream life. Old economy constructs, like soldiers, will fade away.
India Calling!
Forget the statistics and growth figures. There can be no quibbling with the highly visible end use benefits of the ongoing telecom revolution, writes Probir Roy, co founder, Coruscant Tec and Paymate.
If indeed anyone were to be cynical with ''India shining'' or ''10-per cent per annum growth'' slogans, then one area there would be no such quibble is acknowledgment of the impact of telecom on everyday life of the migrant labourer from Bangladesh, Nepal, interiors of rural India, the shoeshine boy in Haryana, fisherman in Kerala, you, me and the upscale corporate chieftain
The end use benefits of the ongoing telecom revolution (one-fifth of India is now digitally connected in some way) has clearly and quite visibly demonstrated increased economic growth and promoted market efficiency – all within a decade.
The classic documented case being a recent Harvard University study showing how the introduction of mobile phones amongst fishermen in Kerala has helped reduce fish catch wastage from 8 per cent to zero, increased profits for fishermen by 8 per cent and dropped prices by 4 per cent ! All because the ubiquitous cell phone now allows the fisherman to call the different landing points while he is still out at sea and take stock of the catch available for sale at each point and land his craft where he is reasonably certain of a better price. Higher profits mean that phones pay for themselves within two months.
Or take Celtel Mobiles''experience in the poorest regions of Africa where it employs more than 170,000 people. According to the Economist, its presence "creates ripple effects…which promote entrepreneurship and economic activity".
The conclusion, a chief economist''s dream, "Information makes markets work, and markets improve welfare"
If one were a keen observer of telecom growth in this country (as indeed I am) and used the barometer of seminars, conferences, roundtables, etc as an indicator as to how this sector has matured. Then one will find that predominantly telecom conferences, etc, have focused on infrastructure, scarce resource allocation, equipment and devices. In essence they have been vendor and engineering driven. And rightly so. The better part of the last decade has seen penetration of wireless and other related infrastructure literally dot the skyline and surrounding landscape by way of open conduits, ditches, dug up roads, sidewalks and unending haphazard criss cross of wires!
The next phase of the telecom revolution will now consist of three key drivers.
First, most of the time VAS has been the last token session or topic of the seminar or summit!
This has to and will change. VAS will become the most predominant revenue and margin driver for operator survival. There is now clear recognition within senior owners / managers that with commoditisation of voice and declining ARPUs (average revenue per user) all forms of VAS, whether it is office applications to consumer entertainment and interaction from the simple person-to-person SMS to interactive rich media and mobile payments will be the buffer in the short term and the cash cow in the long run (estimated to account for up to 60 per cent of operator revenues in next decade of growth).
Obviously the business rules for this will change and operators realise that they need to create an ecosystem of VAS partners like the NTT DoCoMo model (100,000+ partners) by not only sharing more revenue with them but also accruals in a more accurate and timely manner. This will help incentivise businesses to create desirable applicationss and content.
Ultimately carriers are not in the content or software business. They should it open it up to all others and will themselves see an explosion in services they will be able to offer to their increasing discerning users. The next killer application (after email and chat) in the digital space will emerge from within the suite of such VAS.
Second, the emergence of next generation networks and access devices whether they be wireline (IPTV / digital cable), wireless (WiMax / WiFi / Zigbee, HSDPA / LTE, UWB, NFC or satellite (DTH / DVB-HS) will once again change the rules of the game and give consumers a bewildering hodge podge of technology options as to how they talk, view, share, interact, search, shop and pay and enhance their sensory experience. The landscape of consumer choice and price will broaden penetration of telecom touching at some level most part of Indian households in the next five years.
Finally, the last big issue, which hitherto has been given short shrift, will be customer care, retention and overall quality of service at the end use touch points. This current format and culture still does not as yet hint to that but will need to programme itself.
Number portability opening up of more licenses and entry of new players including mmobile virtual network operator or MVNOs will necessitate carriers to differentiate themselves over and above the 4 P''s of marketing. This will be of great importance. The customer retention value is way below the customer acquisition cost in a hugely price sensitive market fragmented by many players and even more wannabees.
I have been a loyal, high value customer for my operator for 10 years, but would easily consider a shift if I can carry my number to another carrier and perception of benefits mitigates cost. Unless, of course I feel that I am being looked after adequately by my current carrier.
The author is vice chairman, Internet & Mobile Technical Committee of the non profit Media Research Users Council (MRUC), and Member, Indian Merchants Chambers Technology Committee.
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