March 2012                                                                             Contact: india.commerce@internation...
The Canadian Trade Commissioner Service                                                Everywhere You Do Businessreport, I...
The Canadian Trade Commissioner Service                                                  Everywhere You Do BusinessSingTel...
The Canadian Trade Commissioner Service                                              Everywhere You Do Businesslaunched th...
The Canadian Trade Commissioner Service                                           Everywhere You Do Businesslikes of Bhart...
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TCS of Canada - India - Digital Media

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  1. 1. March 2012 Contact: india.commerce@international.gc.caeMudhra to launch mobile wallet, shopping services “We are signing up with traders, and all that customersBusiness Line I March 21, 2012 have to do is scan the encrypted QR code, in case of a mobile phone with a camera, or SMS the printed QRConsumer technology services provider eMudhra will code (in case of mobile phone without a camera) to thesoon launch its mobile wallet service. merchant,” explained Mr Jagannathan. QR or quick response code is a two-dimensional bar code.Mr Ravi Jagannathan, Managing Director and CEO, toldBusiness Line that the company had recently got a However, to “enjoy this experience customers have tolicence from the Reserve Bank of India for launching the shop for a minimum of Rs 300,” he added.service. “We plan to launch YpayCash, our mobile walletservices, in couple of weeks.” TCS Insights: Given the high penetration of mobile connectivity in India, the use of mobile paymentThe company plans to tie up with traders for the service, technology will bring a remarkable change in the waysaid Mr Jagannathan. people make payments and do banking services. We are seeing large number of e-enabled services“The proximity payment service has a PKI-enabled companies entering into mobile-to-mobile payment(public key infrastructure) communication,” he said, platform.adding that the company offers a patentedcommunication layer. Merchants desirous of getting thisapplication have to go through a know-your-customer More price cut needed to drive smartphone sales:process. Google India MD Business Line I March 20, 2012PKI or public key infrastructure enables users toexchange data and money on the Internet in a secured Smartphone prices have to drop below Rs 5,000 andway through the use of a public and a private additional spectrum is required for the country to reachcryptographic keys pair. The keys are obtained and 200 million smartphone subscribers, according to Google.shared through a trusted authority. eMudhra is a digitalsignature certificate issuing authority in India. “We are optimistic about Indias smartphone penetration hitting the 200-million mark by 2015 but feel that pricesHowever, money can be transferred between customers have to be sub-Rs 5,000 for more smartphoneand traders only if both have signed up for this penetration,” Mr Rajan Anandan, Managing Director,application. Google India, told Business Line. A price reduction of 30 per cent more is needed to drive smartphone sales, heeMudhra also plans to launch a mobile shopping offering added.Xygle this week, which will help consumers buy retailitems without stepping into the retail outlet. This service Currently, India has around 10–15 million smartphonealso includes items being home-delivered. users and over 900 million telecom subscribers. According to a recent Boston Consulting Group (BCG)
  2. 2. The Canadian Trade Commissioner Service Everywhere You Do Businessreport, Indias Internet economy growth rate of 23 per Globespan’s managing director and Amobee boardcent makes it the second fastest across the G-20, ahead member Venky Ganesan on his take on mobile Internet,of other developing nations, which are growing at an carriers entering mobile advertising space and hisaverage of 17.8 per cent. investment firm’s India plans. Here are the excerptsAccording to IDC, smartphones shipment in India grew How are you reading the mobile Internet market?21.4 per cent in third quarter of 2011 over the previousquarter and 51.5 per cent over the previous year. We are in the cusp of a very early revolution. Think about where Internet was in 1996. That is where mobile InternetMr Anandan similarly predicts that 2012 would be the is right now. The first 1 billion to 1.5 billion users on theyear when mobile shipments would surpass desktop PCs. internet came through the PC and the next 3 billion are going to come in through the mobile phone. That is a lifeAccording to IDC estimates, in 2011 mobile phone changing experience that happens only once in ashipments of around 184.4 million units and IDC thousand years. That might seem bombastic, but thereforecasts the market to clock 301 million by calendar year has been no other time in the history when half or two-2015, at a CAGR of 13.03 per cent. Of this, smartphone thirds of the planet reached out on the same device. Thesegment is forecasted to see an increased CAGR of 63.4 opportunity presented by this is still very early.per cent with a shipment of 77.5 million by CY 2015. In this context, how do you see the mobile ad marketWith trends like social media on the rise coupled with an developing?increase in online commerce, smartphones could be thefirst computing device, say industry watchers. The first thing about mobile ad market is that it’s going to be global in nature and different. Majority of peopleAccording to the second quarter of 2011 IDC PC Tracker accessing Internet only through mobile will be outsidereport, the Indian PC market sales stood at 2.44 million America. The market will be global and may varyunits, showing a sequential decline of 4.2 per cent over according to geography, but online advertising will drivethe previous quarter indicating a trend of consumers and support a lot of services. What is happening is thatwanting more mobility-based devices for their computing carriers used to charge you for the calls, texts and dataneeds. usage. But the problem is that you can’t do that on a variable basis and data services will go at a flat rate.TCS Insights: India has over 900 million telecomsubscribers but has only over 10-15 million But how do you make money when you are capped at asmartphone users. In this price sensitive market, flat subscription rate? The way to do that will be throughhandset manufacturers have to formulate their price mobile advertising which will be a critical part of everystrategy to capitalise on the trend of increased carrier’s strategy going ahead in the world. It is already sointernet usage through mobile phones for various in the USA and it will be so soon in India.usages including social media, e-commerce. Carriers need different value streams which are variable – mobile advertisements and payments will be the way toMobile Ads To Be Big Portion Of Telecom Operators’ go. In India, RBI has already said that the carriers cannotRevenues In India: Venky Ganesan, Globespan do payments. So, mobile advertisement is going to be aCapital Partners big portion of how carriers make money in India in theTech Circle I March 15, 2012 future.Digital advertising market is growing faster than anyone So do we see carriers, especially from emerging markets,has imagined and is now attracting a new set of players. continuing to hunt for ad solution providers?Earlier this month, Temasek-backed SingaporeTelecommunications Ltd or SingTel struck a deal to buy Absolutely. Every carrier is thinking about what theirCalifornia-based mobile advertising solution provider strategy will be and in 5-7 years carriers are going toAmobee for $321 million. The seven-year-old firm has become technology companies. Carriers will end upraised $54 million till date from venture capital firms like going after cloud, which is perfect for them then mobileAccel and Sequoia besides investors like Vodafone, and big data.Motorola and Cisco. The latest deal marks an interestingturn for mobile advertising business with carriers like Coming to Amobee, what do you think attracted SingTelSingTel (which holds 32.5 per cent in India’s largest telco particularly to the firm?Bharti Airtel) directly entering this space. Venture capitalfirm Globespan Capital Partners was an early investor in Amobee is probably the only company in the worldAmobee and had also bet on another mobile advertising which has built its strategy around working withplayer Quattro Wireless (which was acquired by Apple in carriers. The company has built its technology at2010 for $275 million). VCCircle caught up with carrier grade which have high requirements. When
  3. 3. The Canadian Trade Commissioner Service Everywhere You Do BusinessSingTel decided on their partners, they wanted Amobee Micromax MD Rajesh Agarwal said, "Our partnership withor nobody. Spreadtrum supports our objectives of feature customisation to suit local needs, rapid time to marketFinally, what about Globespan’s view on investing in India and innovation on value for money platforms. The Indianmarket? mobile industry is growing at a rate of 12 per cent per year and partnerships like this one will help us captureWe think India is going to be an interesting opportunity the growth opportunity within India and also expand ourbut it is still early. Currently it’s a great opportunity if you distribution to other countries."want to invest in non-technology business and privateinvestments in public equities (PIPEs). Traditional venture Micromax was co-founded by Rajesh Agarwal, Sumeetcapital, what we do, will still like to see for a couple of Arora, Rahul Sharma and Vikas Jain, and the companyyears. I think Indian entrepreneurs like to do (build) more started making mobile handsets in 2008. It currently shipsservice companies than product companies but that is in more than 60 models, ranging from dual-SIM featureearly stages of change. In three to five years India will be phones to 3G Android smartphones, and has ana very interesting venture market to be in since the quality established sales presence across India, Hong Kong,of talent in the country is very high. Bangladesh, Nepal, Sri Lanka, the Maldives, the UAE, Saudi Arabia, Kuwait, Qatar, Oman, Afghanistan andTCS Insights: Mobile operators are looking at Brazil.another revenue stream to offset the crunch they arefacing with low ARPU. The challenge will be to "Our mutual co-operation with Micromax will help expandensure that the advertiser’s objectives are met, our reach in emerging markets and ensure that our R&Dconsumer experience is not spoilt, and most investments are closely aligned with the worlds leadingimportantly the telecom operator’s subscription brands," said Leo Li, president and CEO of Spreadtrum.business is not compromised while working closely Spreadtrum Communications develops mobile chipsetwith the mobile advertising ecosystem. platforms for smartphones, feature phones and other consumer electronics products, supporting 2G, 3G and 4G wireless communications standards. The company’sSpreadtrum Communications Invests $10M In solutions combine its integrated chipsets withMicromax customisable software and reference designs, and itsVC Circle I March 15, 2012 customers include global and China-based manufacturers.Spreadtrum Communications Inc, a fablesssemiconductor provider in China, has invested $10 million Micromax currently holds third position among thein Micromax Informatics Ltd, an Indian mobile brand. The handset manufacturers in India and late last year, thetwo companies will work together through a joint R&D company made major top management changes bycollaboration to deliver new offerings across Micromaxs appointing Deepak Mehrotra as the new CEO besidesportfolio of products. Spreadtrum will also become one of hiring other senior people from Sony Ericson (now Sonythe preferred mobile chipset suppliers of Micromax. Mobile) and HTC.In the past, Micromax attracted a lot of interest from TCS Insights: Micromax established a new businessprivate equity investors who had invested a total of $88 model in India by importing handsets from east asianmillion to buy the shares of the company. However, bulk countries and selling them in the Indian market withof the money went to the co-promoters of Micromax who low margins often tag as "value for money" handsets.sold their shares (more on that here). Strategic tie-ups on R&D side will help them to move up the value chain to offer customised products inThree private equity investors -- Sequoia Capital, this market.Sandstone Capital and Madison India Capital -- togetherbought 5.75 per cent stake (at that time a pre-IPOinvestment) from the four co-promoters for around Rs 210 Indian Angel Network Invests In Digital Gaming Start-crore in September 2010. up Gamiana VC Circle I February 08, 2012Another private equity investor TA Associates hadinvested Rs 200 crore, half of which was through share Indian Angel Network (IAN) has invested approx $1purchase from the co-promoters. TA Associates had million in Gamiana Digital Gaming Pvt Ltd, a three yearinvested Rs 100 crore in the company in December 2009 old Mumbai-based digital gaming start-up.and at the same time, bought shares from the promotersfor a similar amount. The company also planned an IPO Gamiana or House of Games, derived from Gamesbut later withdrew its public offering, citing weak market and Aashiana (house), is an online entertainmentconditions. company and builds online communities with multiplayer games and social networks. In 2010, it
  4. 4. The Canadian Trade Commissioner Service Everywhere You Do Businesslaunched the first product called Jamia Online, an online business in 2002. "He (Dhirubhai Ambani) told me oursocial game. Jamia is a free-to-play browser-based virtual competitor was not any rival mobile operator, but theworld and social space where players can connect and postcard (which then cost 15 paise)," said the Relianceinteract with thousands of other people from all over the Industries chairman. Reliance won the price line inworld. telecom, but could not win over customers - something it will need to change to make a success of its upcomingGamiana plans to use the funds raised through IAN to broadband offering.grow its customer base, enhance gaming softwaredevelopment for existing games, Jamia Online and Ten years on, Mukesh is applying the same cost doctrineVinashi, and bid for new gaming contracts in overseas to his broadband rollout, which is expected in late 2012markets. and one of whose many pieces were put in place earlier this week when it received preferential access to allVishal Golia, co-founder of Gamiana said, “Gamiana, will Network18 content. "We want to do in video what we didnow be able to leverage the global presence, market in voice," a senior RIL official managing the rollout toldinsights and network of IAN’s global members to fuel our ET in December on the condition of anonymity.growth.” Golia also started Maharaja Games in 2004which provides business process value-sourcing services "It will be a play on the four screens in your life," is howfor gaming, animation and social networking companies. the official explained the planned RIL broadband offering. He said the plan, for which RIL is currently developing aThe other co-founder of Gamiana is Sumeet Maniar. platform-neutral technology, is to stream high-speed, cheap and exclusive content on the four screens anThe firm seeks to address the new markets created by individual engages with: mobile, computer/tablet, TV andthe synergies between the increase usage of Internet on billboards.smart-phones, online gaming and social networkingacross the globe. The company is focused on many A successful rollout will require the group to achievedeveloping markets like Brazil, Turkey and the something it has not: win over the customer. "RILsPhilippines. Additionally, the company will continue to consumer-centric and knowledge-based businesses facedevelop real-time synchronous games across PC, certain challenges, which it may need to overcome toFacebook and wireless platforms (including Android, iOS create value," said a June 2011 report of Kotakand others). Institutional Equities Research by Sanjeev Prasad, Gundeep Singh and Tarun Lakhotia.“The passion and domain expertise that Vishal andSumeet bring to Gamiana and their ability to execute the For Mukesh, a Hindi film buff, broadband will be his fourthbusiness plan built my confidence in this team,” IAN effort at transiting from servicing industrial customers tomember Chetan Shah said on the investment. also catering to individual consumers. Each of the groups first three attempts to cross over has failed to drawThe Indian Angel Network has over 180 members and consumers, either because of policy bumps (oil retailing)has completed over 25 investments across multiple or the companys shortcomings in deciphering thesectors like IT, mobile and education. In 2011 alone, IAN nuances of the target set (telecom and retail).invested nearly $10 million in 10 start-ups, such asJigsee, GrOffr and Vayavya. It has also made several The Reliance DNA - size, sweep and pricing - is presentsuccessful exits. in what one knows about its broadband offering so far.TCS Insights: Gaming has a very bright future in Reliances Broadband PlanIndia and is growing at a compounded annual growthrate of 30 percent as per the FICCI-KPMG Indian "It will be a repeat of the (first) big bang," saysMedia and Entertainment Industry Report 2012. independent consultant BK Syngal, who was the architectMoves like this with angel investors putting seed of Mukeshs previous entry into telecom, and headed thatfunds in digital gaming start-ups show the potential business from 1999 to 2002.of the market and quality of companies emergingfrom India. RIL is the only company with pan-India wireless broadband spectrum, bought for about 17,600 crore. It has also committed to invest $5 billion in the first twoRILs 4G broadband to offer exclusive content & years. On this, it can offer fourth-generation (4G) servicesspectacular speed at dirt-cheap rates that reportedly have speeds of 50-100 Mbps in testing -Economic Times I Jan 7, 2012 or three times the fastest 3G services its rivals currently offer. Its main competitors such as Bharti Airtel,In an informal interaction with ET late last year, Mukesh Vodafone and Idea are doing the rounds of regulatoryAmbani narrated the advice his father gave him before forums on whether they can patch together a nationalthe launch of the then-unified Reliance groups telecom presence through tie-ups, that too for 3G. The legal verdict on the 3G roaming pacts will determine if the
  5. 5. The Canadian Trade Commissioner Service Everywhere You Do Businesslikes of Bharti, which has 4G spectrum in 4 circles, can venture UTV Software, for more gaming andalso offer wireless broadband services on a pan-India entertainment content, say industry executives in thebasis through roaming agreements. know. In November, it acquired 38.5% in Extramarks Education, a company focused on school education andThe recent conciliatory posturing between the estranged digital learning, for an undisclosed amount.brothers has made a tie-up between Mukeshs broadbandventure and Anils Reliance Communications - which the TCS Insights: Reliance Industries Limited entry intobrothers launched together in 2002 to take on the the data services business with 4G technology willpostcard - a possibility. The two groups have been certainly revolutionise the broadband scenario intalking, says an industry executive in the know, to see if India. Initial trials conducted by company yieldedMukeshs broadband business can use Reliance download speed of 80 Mbps and upload speed of 20Communications formidable infrastructure and also tie up Mbps, which is phenomenally higher than the currentwith it to offer calls. 7Mbps available in the market through 3G dongle. With this super high performance and predatoryRIL has also grabbed the lead in content. This weeks pricing, it might become unbeatable in the broadbanddeal gives RIL preferential access to all of Network18s space here in India.TV, Internet and digital content, across languages andgenres. RIL is also talking to other media andentertainment companies, including Walt Disneys Indian

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