The mobile industry is a relatively bright spot in a slow global economy, as mobile penetration is still growing. The recent Mobile World Congress (MWC 2016) in Barcelona saw the industry showcasing new products and discussing new trends. There was an emphasis on Virtual Reality (VR) headsets, smart watches and other wearable technology, and on smarter, faster phones with longer-lasting batteries and bigger screens. The transition from wired to wireless and from big screen to small screen has changed many paradigms. There are big implications for e-commerce, advertising, marketing, gaming, publishing, media and entertainment, and so on.
India has around 315 million mobile Internet users and an internet population of about 400 million. Over 70 per cent of India's data traffic is generated on mobile. By end-2016, India will be the world's second-largest smartphone market with 204 million smartphone owners, overtaking the US (198.5 million). Growth rates are incredible. India's internet population increased by 49 per cent in the last year. Data traffic grew by 74 per cent. Mobile data traffic on 3G and 4G networks rose by over 100 per cent as surfers shifted up from the slower 2G network. But smartphone penetration is still relatively low, given close to one billion mobile users. India's internet users are young and eager consumers of new technology. Over 30 per cent of Netflix India subscriptions are mobile and YouTube receives well over half its India traffic from mobile. Over 65 per cent of e-commerce transactions are from mobile and some e-commerce players are "app only". Mobile wallet usage has exploded, with over 100 million mobile wallet owners (versus roughly 20 million credit card users). Unfortunately, mobile malware has also increased exponentially. Surveys indicate that smartphone users see privacy and security as key differentiators, along with price. There is also rising interest in "immersive" wearable devices, such as VR headsets, which can be connected to a smartphone. Game playing has zoomed.
Major challenges will arise side by side with the opportunity to build entirely new ecosystems of small-screen oriented apps, programs and content. M-commerce players, as well as credit card and m-wallet providers, must continuously upgrade security, given proliferation of malware. Advertising must be reinvented to connect to mobile audiences, without antagonising users. One of the most hyped technologies at MWC 2016 was a network-level ad-blocker, Shine, which can be deployed directly by telecom service providers. Shine will surely trigger questions about censorship, while placing a big question mark on advertising as a mobile revenue stream. India faces more basic challenges as well. Networks are slow, data charges are high and data theft is easy. Litigation, disputes and scams have slowed network expansion. Payment systems are underdeveloped, necessitating collection of cash on delivery, which is expensive and insecure. Telecom service providers demand high revenue shares from developers and partners. These barriers must be surmounted - and the sooner the better.
