Web2.0 vs Mobile2.0 : The Indian Context

-

Web2.0 or Mobile2.0?

Which is more relevant to Indian domestic market? Which will succeed and Which companies will attract VCs? You may be trying to pick up a paper and start scribbling a checklist for a successful startup. But take a moment to read some insights from TiECON, Delhi by Basab Pradhan Founder &CEO of Gridstone Research:

- Unlike in the Valley, Web 2.0 has no relevance to the Indian domestic market. Internet penetration is low (5.4%), broadband is lower (<0.5%). Even if you include use at work, account sharing and internet cafes, the consumer internet is a tiny market. It may be interesting for some compelling ideas or if someone wants to bet on growth. But in my opinion, it is not going to attract much investment unless there is a broader "global Indian" or a "click and mortar" play.

- Mobile however is hugely interesting. Mobile penetration in India is twice that of the internet and is growing at rates close to 50%. There are opportunities to develop mobile applications that the developed world never needed because of high internet penetration. Booking a cinema ticket in the US is probably done 95% of the times over an internet connection and 5% on a cell phone screen. In India it may be totally different. This also holds out the opportunity that Indian startups may develop mobile applications for the Indian market and then take them to Europe and other developed markets.

I totally agree with his comments about web2.0. Leaving aside chatting, web browsing and emails, and these days a little bit of blogging, internet is not really impacted lives of many of us. Its a good start that some of us started using internet for shopping and other activities but that number is so low, that it can be just ignored.  

When it comes to Mobiles, there is more good news in terms of penetration. But GPRS subscriptions are still quite minimal. And there is no clear word on 3G yet. Only SMS based applications can really reach a wider audience, but do we have any SMS based applications? Many entrepreneurs are taking a hint from Europe and America to create applications on Mobile that are essentially extensions of web2.0 applications and applications that need internet to operate. Can they reach out and unleash the mobile market in India? Odds are not in favour, in my opinion.

And here are a few hints on what would be much more relevant to Indian domestic markets from his post:

- Most people agree that plain outsourcing is no longer a great investment idea. There is a lot of competition and you have to get everything right to build a defensible business. However, managed services - services combined with a software platform - can be very competitive.

- The big opportunity, and one that doesn’t get talked about much, is in non-tech consumer oriented products and services. The Indian middle class is growing and so is its buying power. Every category is growing at a rate that should interest any VC. The discerning Indian consumer wants quality products and services that meet her very unique needs. Food, recreation, entertainment, leisure travel and retail are huge and growing markets. Seeking funding for startups in these areas is also going to be tricky if the entrepreneur wants expertise. Most of the VC expertise in the Indian market is technology and services related, reflecting the expertise in the US market where technology and healthcare are the two largest areas of venture investing.

Many of us think, developing a product and moving away from pure software services is a great idea and the only way to prove India's economic mettle. But I still believe services are going to be the key to sustain the growth that we have seen in the last decade. Services that directly impact the domestic Indian market, is one of the key areas. As he mentioned, managed services are incresingly becoming more sought after.

Like Real Estate boom we witnessed in most parts of India, there will be a boom for travel, entertainment, sports and healthcare and fitness in the next few years. I bet my few cents on healthcare and fitness than technology.

Technorati tags: , , , ,

Comments

Post a Comment

Popular posts from this blog

Newsworthy News in Red October : Dow Jones & Tax Dodgers

-
Dow Jones Index crosses the symbolic 10000 figure. U.S. stocks rallied, sending the Dow Jones Industrial Average above 10,000 for the first time in a year, on better-than-estimated earnings at JPMorgan Chase & Co. and Intel Corp. Bank of America Corp., American Express Co. and JPMorgan more than doubled since the Dow slid to a 12-year low on March 9 as global financial firms began recovering from $1.6 trillion in writedowns and credit losses. International Business Machines Corp. and Hewlett-Packard Co. jumped at least 54 percent since March 9 on signs the nation was recovering from the worst recession in seven decades. Source: Bloomberg And, about 7500 International Tax dodgers file for IRS Amnesty to avoid jail Some 7,500 international tax dodgers have applied for an amnesty program that promises no jail time and reduced penalties for tax cheats who come forward, the Internal Revenue Service announced Wednesday. … The program is part of a larger eff...
Read more

USCIS Selects Final H1B Petitions by Random Selection - Almost a 50% chance for each Application

-
U.S. Citizenship and Immigration Services (USCIS) announced today that on April 12 it conducted the computer-generated random selection process to determine which H-1B petitions, subject to the congressionally mandated H-1B cap for fiscal year 2008 (FY 2008), would continue to final processing. USCIS completed this determination ahead of the preliminary schedule noted on April 3, when it announced it had received enough petitions to meet the cap for FY 2008. The 123,480 cap-subject petitions received on April 2 and 3 were labeled with unique numerical identifiers and selected randomly by computer. The chosen numerical identifiers were then transmitted to the appropriate service center for further processing. Source: USCIS Announcement Number 123,480 looks a lot better keeping in view initial estimates. A good 50% chance for each application to be selected.  Update: 3rd May 2007 Hello friends, I understand your anxiety. But don’t loose your hope and/or temper yet. Please wai...
Read more

H1B 2008:USCIS released Preliminary Numbers

-
USCIS today released the final count of number of unique pieces of mail received for H1B petitions. It received 133,000 unique pieces of mail containing H-1B petitions. I guess, each piece of mail will ' mostly ' contain more than one petition, as no company would send each petition in a seperate package and its most unlikely that a firm applies for just one petition. Probably by the end of next week, we might know the actual number of H1B petitions filed and how lucky one must be to get through the initial filter. Source: USCIS Releases Preliminary Number of FY 2008 H-1B Cap Filings  (26KB PDF) 04/05/2007 During Monday and Tuesday, USCIS received 133,000 unique pieces of mail containing H-1B petitions. This is lower that the original USCIS estimate of 150,000. USCIS based the initial estimate on amounts from manifests received along with the mail. USCIS reached the updated number following a physical count of the mail. Each piece of mail may contain more than one H-1B pe...
Read more