Two decades after its birth, the World Wide Web has started influencing consumer habits. The way we communicate, conduct business and entertain ourselves, has undergone a visible change in 2010. Consumer preferences have also been the driving force behind major innovations in wireless data and just about every other area that involves the internet and consumer electronics. Based on the 2010 experience, all signs point to a year in which we should gain more control over how we use and pay for services on the internet, mobile broadband and consumer electronics. Get ready for the major confluence in 2011. We asked experts what they thought about the progress made in 2010, and here’s what they told us:
Despite a sharp uptake of social media (Facebook and Twitter) on mobile phones why did Google Buzz fail to get users excited online?
Rachna Sharma
Business Director
OgilvyOne Worldwide
India is witnessing a mobile revolution — we have crossed 600 million subscribers. Add to this the introduction of low-cost smartphones, the growth for Facebook and Twitter, which were already popular platforms online. Also, the generation to come is more comfortable with personal devices like a mobile phone for social networking than a home PC, which is shared by many. No wonder we saw Twitter and Facebook making their mark on Indian audiences this year. Facebook even became the number one social networking site in India overtaking Google’s Orkut.
Facebook numbers are overwhelming not just in terms of subscribers but in terms of active usage. The reasons are obvious — Facebook is your social life on the web. It is as real as it can get. You have your friends in your network, you share your pictures with them, you poke them, put up status messages for them, even organise real life parties with them. Another very interesting aspect was the resurgence of gaming in India through Facebook. The site utilised and engaged game developers, and threw the medium open for them to develop games. It was an instant success.
Twitter, too, saw exponential growth in the last two years in India. Indians have been very active SMS users, using abbreviated languages on text messages that helped in taking to Twitter. A broadcasting medium to let your friends or colleagues know what you are doing, reading and feeling, Twitter quickly peaked in popularity. The celebrity angle, the simplicity — all gave it the impetus. However now it needs a real push in terms of user engagement. We also saw some brands like Airtel and Samsung utilising the medium for brand promotions.
Now coming to Google Buzz. First of all, noone seems to be using it. It was a launch that went wrong from the beginning. For one, a person uses Gmail for one purpose only — emailing. The product was piggybacked on every one’s Gmail account, which means that one ends up following almost the entire Gmail address book and gets almost 100 buzz updates a week. Now, one may not want updates from all the people on their Gmail account, and may need to only know about people they know. One might be using Gmail for different reasons — for personal emails, for official communication, for sending in professional articles, resumes etc. Gmail is an email tool for most and they do not want to mix that up with any update engines. And on top of it most people already have Twitter and Facebook for that. People simply lack the time or effort to update Google Buzz and Twitter. Google Buzz came late to the party.
Why did Google fail miserably as a handset vendor (Nexus One) despite topping the charts as a software vendor?
Rahul Gupta
Senior Manger (Emerging Markets)
Strategy Analytics
Android (Google’s operating system for mobile devices) has been a success story globally and in India, in particular, as it fits the requirement of handset vendors, especially Indian handset manufacturers, who are looking for a platform to launch dual SIM devices. I see Android becoming more successful in the years to come.
With the launch of its own smartphone range Nexus, Google tried to fix its hardware puzzle as well, but in vain. Subsequently, Google’s first device – Nexus One – was a big flop in the US market. The reason wasn’t that Nexus had any technological issue. The issue was more with the way it was priced and the way Google tried to counter the subsidy driven handset market of the US by selling devices directly to consumers. Nexus one was a flop and now Google tried to fix the problem with the launch of Nexus S, which is now sold at a subsidised rate of $199 with T-Mobile and at Best Buy stores.
Key to their success and long-term ambition is to boost the mobile browsing ecosystem. More open devices capable of browsing/search/maps from Google or others are positive for Google. But Google’s struggle to replicate its software success in hardware is just a matter of time and a blockbuster device. The competition is surely keeping an eye on it.
Kunal Bajaj
Partner, Director India
Analysys Mason (India) Google might have made certain mistakes in its products, but never has anyone written-off the company for having failed. The same applies for the search giant’s attempt to enter the handset market with Nexus One. To start with, Google had a very hands-off approach when it came to Nexus One. They thought people will log on to their website, order the device and they would have to just ship it. But things do not work that way in India. The user did not have access to the handset before they bought it, whereas the touch and feel concept is still very important in the Indian context.Add to this, if you buy a product worth $800 - $900, there was no after sales support. Google needs to rethink its approach and strategy and see how the next variant – the Nexus One S – can be made a success in India. Google’s Nexus One S can be a game changer for the company in fast growing markets like India, if only they invest a bit more money and push more towards branding and retail.
The success of Android on the other hand, is an example of how – if Google sets it mind to something – it can create a winner, even in a cluttered market. As much as the success of Android goes to Google, in India it has also made an impact due to the handset manufacturers. If OEMs did not develop innovative and attractively priced devices, the Indian user would not have latched on to Android, either. If you look at the scenario before Android was launched, Microsoft’s latest version of Windows mobile was not yet ready, Apple’s OS was already locked and only available on Apple devices, Nokia had Symbian, so did Sony Ericsson. Indian consumers and OEMs were waiting for the next big thing for the mobile phone, and Google made its entry with Android at the right time.
All the new entrants in the Indian market like Intex, Lemon, Micromax, Olive, Videocon and others have launched Android phones. Android already accounts for almost seven per cent market share of the approximately six million sold in India this year. There will be 12 million smartphones sold in India next year, presenting a huge opportunity for Android to continue its grow story.
E-commerce has finally taken roots. Why is m-commerce still nowhere on the horizon?
Krishna Prasad
Chief Experience Officer,
Dentsu Digital
When we reflect on the evolution of e-commerce in India, we realise that it’s only in the last two years where we have seen significant traction in the business. Mumbai, which once was the main centre of e-commerce has been replaced by Delhi-NCR, followed by many small towns. So, why have consumers started to shop online in the last two years? The reason to me, seems to be very basic and simple — the buying experience. This includes an online shopping experience that has been made simple and intuitive along with the guarantee of quick delivery and after sales support. Consumers, too, are evolving and are not very worried about using their credit cards online.
Moving to mobile commerce, I would believe that the biggest challenge here is again the buying experience. We all know that we have a very large base of mobile users but as you narrow down to consumers who have credit cards, smartphones with GPRS, you start to see a relatively smaller set of users; and these consumers could also be the ones who are already used to e-commerce online.
Mobile bandwidth available today is also very narrow, which makes the basic browsing experience a challenge. Then, most commerce sites are not enabled for mobile devices (also remember there is no standard size; different phones have different screen sizes), which means that you are still interacting with a page that is designed for a PC experience. For m-commerce to really move onto the next level, it is not just about having better devices but the entire ecosystem needs to rally around businesses offering mobile versions of their commerce destinations, good and reliable bandwidth and customer support that can help consumers in case there is an issue. Mobile applications could possibly be the game changer here especially if there is an application that can possibly be pre-installed and can securely store credit card numbers and make the experience of ‘click and buy’ as simple.
Kashyap Deorah and Zishaan Hayath
Co-founders of Chaupaati.com (acquired by Future Group) and Business Leaders, Phone Commerce, FutureBazaar.com
The year 2010 marked a turning point for e-commerce with companies across the size spectrum finding firm ground. There was a healthy addition of startups in the e-commerce space and group-buying sites & deal destinations created a special segment. The VCs returned to the party with multi-million dollar investments — Tiger Global invested in Flipkart, Battery Ventures and Greylock Partners committed funds to Taggle, Canaan pumped funds in Naaptol, Sequoia backed Fashion and You, and there were more. Existing e-commerce players consolidated their positions with acquisitions and expansion plans. And a veteran company made big-bang debut on the bourses — Makemytrip saw a 90 per cent increase in its valuation when it was listed on NASDAQ at $900 million.
In a country that adds more mobile subscribers in a month (15 million/month) compared to internet users in an entire year (14 million/year), businesses can’t afford to ignore the mobile space. 2010 saw the creation of a spring board for m-commerce takeoff in coming years. Mobile penetration reached 680 million subscribers across India. The mobile handset market was flooded with companies like Micromax, Maxx, Karbonn, Lava etc offering high-feature phones at low prices. Smartphones became a significant and a within-reach category.
Many of the e-commerce companies have already started to link their web strategy along with a mobile strategy. Several portals offer a manpower-supported the ‘Buy on phone’ option. While some others have invested in building a mobile interface to reach more customers — Cleartrip followed up their simple web interface with an even simpler mobile interface and found enough traction. The positive sentiment from a fast growing m-commerce space and a more robust e-commerce environment will attract even traditional businesses to focus their energies on selling through web and phone in the following years. While e-commerce is here to stay, m-commerce is waiting to erupt as the next big thing.
Why is it that broadband connections on PCs continue to grow in single digit, while mobile Internet continues to exceed all expectations?
Kedar Sohoni
President, Informate Mobile Intelligence
The government has set a target of one billion mobile users by 2012. I believe by next year mobile internet users, estimated at around 30 million users, will overtake PC Internet users at 60 million subscribers today. This will happen on the back of affordable handsets, pay-per-use mobile data plans on 3G networks and improved internet experience on mobile phones. As per our data, mobile users in India are leaping ahead in their adoption of smartphones and the applications they use. For instance, recent Informate data suggests that chat services on mobile phones grew by 72 per cent while voice-based services showed a drop of about five per cent. Emails, web browsing, and chat emerged as the fastest growing services on mobiles. Internet on PC is designed to allow users to create content while the mobile platform encourages content consumption. That’s been a major reason why mobiles have become a handy gateway for consumers to log on. Add to it, the data plans that allow users to access data for less than Rs 10 per day. This makes mobile browsing accessible to a larger consumer base.
Netbooks and cheaper laptops were expected to reduce the hardware acquisition costs, furthering the broadband penetration. But the price difference between a netbook and a smartphone has widened with Android-based smartphones at just Rs 5,000 that come bundled with Facebook and Twitter, helping users log on in a seamless manner.
Compiled by Preeti Khicha and Shivani Shinde
