Mobile internet is very different from the fixed line internet. The browsers can be a good proxy to fragmentation in the operating systems market. The fixed line internet is dominated by 3 browsers with Internet Explorer having a little over 50% market share as it is dominated by Windows operating system. However, in the mobile internet, the most used browser is a little over 20% and the browser share tracks the fortunes of the vendors.

The chart below from Statcounter shows the global market share for mobile browsers. Opera is the most popular mobile browser.

The share for Blackberry browser follows the declining trends in RIM’s appeal. Similarly, Android browser has consistently gained market share since June, 2009 and is now the most popular browser after Opera. Interestingly, iPhone browser has shown a pretty flat share despite increasing popularity of iPhones.

Click on Mobile Browser Market Share to download the excel file of the chart data from Statcounter.com
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VoIP (Voice Over Internet Protocol) is a very popular and growing facet of the communication market. Using an Internet connection, you can stream phone calls to anywhere on the planet without using a mobile provider. With VoIP, phone calls are made through the IP network on your computer. Many users access wireless internet whether they are at home or on the go. The marriage of these two technologies seems only natural, but can VoIP be used with wireless Internet?

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This is a guest post

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eCommerce has been a dominant theme of internet for the last one decade. The interest in eCommerce was at its peak during dotcom boom of year 2000 and after the bubble got burst, for a long time there was little activity in this space. However, there is a renewed interest in online commerce in the last 2-3 years due to the economic downturn and with online companies offering great deals and value. By definition, eCommerce is buying and selling of products and services over internet but I like to include the online services that influence the buying decision in the offline world as well. This means even review sites like the TripAdvisor.com are part of eCommerce.In fact, I would like to expand the scope of eCommerce from merely internet to other carriers like voice (telephone) and data (SMS) and hence mobile phones are emerging as key access medium.

Factors driving the online commerce:

1. Creative business models have emerged which are focusing on substantial value to the consumer, e.g. Daily Deal sites offer upto 60-70% discount on services.

2. Merging of online and offline space has created a unique proposition for the consumer rather than only digitizing the commerce, e.g. today the mobile phone users can be informed about the deals in the vicinity leading to higher foot falls in the brick and mortar store. Even the daily deal sites are driving users to the offline stores leading to better profitability for merchants.

3. Greater Consumer Trust on online commerce now due to years of existence and specific steps taken by credit card companies around security. Alternate billing mechanism like Paypal, Alipay have emerged that limit the consumer’s exposure to fraud.

4. Cash on Delivery (COD) is emerging as a leading factor in building trust especially in the eastern countries like China and India. In COD, the risk to the consumer is minimal as the payment is made in cash when the goods are delivered.

5. Economic Downturn has resulted in higher adoption of online commerce as consumers look for cheaper products and deals. A lot of offline merchants are also looking at online channel to increase sales and reduce cost by shrinking the offline presence.

eCommerce Business Models

There are multiple business models for online commerce but they can be broadly classified into three categories:

1. Stores Model- In this model there is a direct online transaction between the buyer and seller. The model is similar to the brick and mortar shop with the only difference being no face to face interaction between the buyer and seller. The seller has to hold inventory and is responsible for the entire supply chain. Within the store model, there are multiple variations like

* Manufacturer selling directly to the consumers thereby removing all the intermediaries, e.g. Dell

* Multi-Branded Retailers selling to the consumers to provide variety, e.g. Amazon

* Flash sales or Private sales sites offering luxury brands at a deep discount to their registered users. This model helps the brands to liquidate their past season products and are put up on the website as a limited period, limited quantity offer, e.g. Gilt Groupe, HauteLook

* Curated products selected by experts are put up for online sale. Here the variety is low but the product quality is very high, e.g. Everlane – finds out the best goods around the web and bring them to the consumer. Everlane has a bunch of curators who are trendsetters within various industries selecting stylish and cool products

* Subscription model is another variation of the store model where for a fixed monthly subscription fee the retailers send the products selected by experts suiting the style and needs of the consumers, e.g. Shoedazzle provides regular supply of shoes for a monthly fee of $39.95 based on the consumer’s style

2. Brokerage Model- The brokerage models brings together the buyers and sellers but do not necessarily participate in the transactions. This model has seen the most innovation in the last one decade and it is expected to continue innovate in the coming years. The various sub-models in this model are:

* Online Market Place - similar to a physical mall where the mall owners do not own the inventory and are not responsible for the supply chain but host the retailers so that the consumers can get options as well as variety. The market place became very popular during the dotcom boom and it is interesting to see that they are still very popular. The market place can be Business to Business (B2B) or Business to Consumers (B2C) or Consumer to Consumer (C2C). The most popular market places are Amazon, TaoBao. TaoBao of China in particular is an interesting C2C  market place which did business of over $30 billion last year

* Group Buying offers products and services at significantly reduced prices on the condition that a minimum number of buyers would make the purchase.  Group Buying sites have suddenly become a rave after the success of Groupon but interestingly, origins of Group buying can be traced to China where Tuángòu or team buying was executed to get discount prices from retailer when a large group of people were willing to buy the same item

* Comparison Shopping model allows individuals to see different lists of prices for specific products. Most price comparison services do not sell products themselves, but source prices from retailers (online and offline) from whom users can buy, e.g. shopping.com, Thefind, Goodzer, Nextag etc. Price comparison sites typically do not charge users anything to use the site. Some, like Newegg, offer online coupons. Instead, they are monetized through payments from retailers who are listed on the site (also called the affiliate fee). Some of the comparison shopping sites have released a mobile application that allows the users to compare pricing while shopping in the offline world

* Online Auction model is one in which participants bid for products and services over the internet. In this model, the site does not own the inventory and is only responsible for conducting the auctions, e.g. eBay. Another interesting variation that has emerged in the last couple of years is unique bid auction which is a type of strategy game related to traditional auctions where the winner is usually the individual with the lowest unique bid. Yet another variation is penny auction, a type of  all-pay auction in which participants must pay a non-refundable fee to place a small incremental bid. When time expires, the last participant to have placed a bid wins the item and also pays the final bid price, which is usually significantly lower than the retail price of the item, e.g. Auctionair

3. Social Commerce – In this model, the social media supports social interaction and user contributions, to assist in the online buying and selling of products and services, e.g. in Shop Socially, users can ask shopping questions to their friends. User usually get their shopping questions answered quickly by their friends who may have already done the research or bought a similar product. User can also share info about their recent purchases to get compliments, comments and reactions from friends.

The above classification of eCommerce models is not mutually exclusive, e.g. the group buying sites would qualify for both brokerage as well as social commerce models. e Commerce is still very small and emerging and hence I expect many model new models to emerge in the next few years. Indeed a very interesting space to watch out for.

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Mobile Technology is transforming many industries and is making lives of millions of people easier. In the next few articles, I would focus on the use of mobile technology in different industries and processes. In this article, I would elaborate on the use of mobile at Airports.

For a moment lets imagine ourselves at an airport. The images that flash our mind are that of crowded lines, flight delays, people scrambling for their luggage and uncertainty on taxis. This is not a happy situation for both the passenger and the airport authorities. Many people attempt to choose their airlines in a way that the busy and troublesome airports can be avoided leading to loss of revenues for the airports. Airports need to change fast and adopt the latest technology to fulfill the security issues without causing inconvenience to the passengers. Mobile technology can go a long way in providing better experience at the airport and improve processes leading to cost reduction. However, the initial investment would need to be made by the airports and the return on investments may look low initially but if the strategy is played well, then it can soon lead to substantial cost savings or additional revenues for the airports.

There are many areas where the mobile technology can be used at the airport. It can be used to improve the airport processes leading to passenger convenience, and/or increase revenues by generating higher footfalls at the retail points within the airports. Emerging technologies like NFC (Near Field Communications), RFID and indoor positioning along with increasing popularity of devices like smartphones and  tablets would go a long way in making the airports efficient and passenger friendly. The following are some of the use cases for mobile technology at airports:

1. Flight and Airport Information : The first aim of any airport should be to develop a mobile application that provides basic features like real time flight information, terminal maps and check-in facility. The flight information needs to be personalized and timely. The application can also help in booking the taxi at the destination. Heathrow Airport in London has an application that provides the following features:

• Terminal Check
• Comparison of travel options – directions, fares, parking, etc.
• View the latest airport security guide
• Mobile-friendly terminal maps
• Full shop and restaurant listings
• Live flight updates on demand

The application can also have a destination guide so that the passengers can browse important information at leisure (see the demo below)

http://www.youtube.com/watch?v=fRNKj54snS8

2. Self Service: The next step should be to give a mobile boarding card (bar code or NFC enabled) so that the  passenger can check-in without having to stand in the queue for the check-in counters. For frequent travelers, permanent luggage tags may be issued which the passenger can configure online to include the destination details. The information from the RFID tags can be transmitted to the mobile phones which means that it should be possible for the airports to show the tracking of the luggage from the aircraft to the belt so that the passenger is not worried about the whereabout of the luggage while waiting for it to arrive. Also, the passenger would know when the luggage is likely to arrive.

Self service and automation of processes are likely to result in significant cost reductions due to simplification of processes. The luggage tags with mobile boarding pass should be able to eliminate check-in queues for over 80% of the passengers. This would lead to cost reduction for the airlines as fewer check-in counters would be required to service the passengers. Schiphol Airport uses bar code scan to print the luggage labels for self service. See the demo below

http://www.youtube.com/watch?v=WGO9SmTrfV0

3. Indoor Positioning: One of the main advantages of using mobile technology is that the mobile phones can provide location. When a person is outdoors, satellite position can be very accurate but indoor positioning was so far a challenge. However, in the last couple of years reliable indoor positioning mechanisms have emerged that can provide accurate location of the users. The airline/airport staff is always looking for the missing passengers and make continuous announcements on the PA systems. Delayed check-ins sometimes result in delay of flights. With the help of indoor positioning, it would be possible for the airline staff to locate the passenger and ping him to board the flight. I do not know if missing passenger is indeed a key reason for delays but atleast I have got that impression by the pilot’s announcements when the there are no apparent reasons for the delay. Indoor positioning can also show the passengers the route to the gate and how much time it would take to reach the gate. Automatic alarms can be set so that passenger is reminded to start moving to towards the gate some time before the boarding time. This functionality would be particularly useful at large airports like Frankfurt airport. Copenhagen airport uses indoor positioning (demo below) to keep track of its passengers. At the Copenhagen airport. the indoor positioning system is RFID/blue tooth based which is given as a tag on check-in and is also installed on the trolleys so the mobile phone is not really required for tracking.

http://www.youtube.com/watch?v=4PuqRCSpYAs

Another very important use of the indoor positioning system is to drive the footfalls to the retail outlets. Today, airports are like malls and are huge. The passengers are not aware of the location of the outlets or any promotions that the outlets might be running. With indoor positioning, a customer can see the deals around him or locate the outlets of his interest.

4. Augmented Reality: Augmented reality overlays location specific information over the smartphone or tablet screen. It can be used to improve passenger navigation, provide personalised offer or display other passenger feedback. Copenhagen airport would soon launch an augmented reality application as a way around limitations of indoor geo-localization services allowing passengers to use augmented reality to plan their time inside Copenhagen Airport and to get information on gates, shops, restaurants and other services in a fun and interactive way. Passengers will be able to ‘scan’ the terminals using their iPhone camera, which will then highlight the distance to certain points of interest and provide directions to navigate to them. Malaysian Airlines is using augmented reality application to find the nearest airport and book ticket (demo in the video below)

http://www.youtube.com/watch?v=LPhoizmFssM

What should be the approach of Airports authorities towards use of mobile technology?

The approach of airport authorities towards use of mobile technology at airport is very critical towards success of the mobile initiative. There is a general tendency to approach mobile application development the same way as website development. However, this approach is a sure shot recipe for disaster. Mobile technology offers so much more than an average website due to features like location, camera, accelerometer, etc. On top of this, the mobile phone is very personal as is always “ON” unlike any website accessing device like laptop. The involvement of any user on a website is much lower than that on mobile phones and hence it is imperative from the brand and facilities perspective that the airport authorities either hire mobile experts or hire consultants who can program manage the implementation of mobile technology for the aurthorities.

The second most important aspect is the clarity on scope of use of mobile technology. It is important that there is a clear understanding amongst all stakeholders on the purpose of the mobile technology. The airport authority can use the mobile technology to either generate more revenues or improve process or both. The clarity on the purpose would define the required involvement of airport authorities. It is recommended that the airport start with the application development and use the mobile for location based services or process improvement in the second phase.

Another contentious issue is on the intellectual property rights of the application. The developers would insist on retaining the IP so that he or she can use the same application at other airports or modify the application in a way to increase its utility in other industries. By retaining the IP, the developers can increase their return on investment. Airport authorities can relinquish their claim on IP but will need to build enough safeguards in the contract so that the developer honors its commitment on a long term basis.

Lastly, use of mobile technology at airports not only improves the processes but can also provide additional advertising revenues to the airport authorities. Airports would do well if they do not confine themselves to within the boundaries of the airport. The airport authorities should see themselves as a part of the travel industry and hence the use of the mobile application should be extended beyond the airport like for booking hotels, taxi, etc. so that the revenue earning potential can be maximised for the airports.

Recently I came across this article on Techcrunch on Facebook valuations reaching $75 billion and it got me thinking about the lofty valuations facebook has been commanding in recent times. Based on secondory market deals, it seems Facebook is round about $70 to $75 billion – A jump of almost $25 billion in 2-3 months (Goldman valued Facebook at$50 billion in October 2010. Just in Feb 2010, Facebook was valued at $9 billion. See the chart below on Valuations of Facebook over the years (collated by ClickThrough )

Unable to understand what are the drivers behind these valuations as they seem just too big and not sure when will the investors be able to make money from these huge valuations. Did some maths quickly and compared it with some other equivalent listed companies. Following is the synopsis it :

1. Based on $70 billion valuation and 600 million users, each facebook user is worth $117

Worth to mention that there are no tangible assets which the facebook has here. Facebook reportedly made $500 million profit in the year 2010 which means around $1 for every user. Now if we take this data at its face value it would mean that facebook would need to have 10 billion users pretty soon to be able to return $70 billion back to its shareholders in around 10 years or less (very rough NPV calculations). Practically this is not possible as we dont have 10 billion users on earth. So obviously facebook would need to start generating very high profits per user very quickly.

Believing that Facebook could potentially capture 1 billion users, this would mean facebook would have to generate $10 per user in profits every year. If we assume that Facebook is going to keep its net margins impact then that means average revenue per user of $20 per year. I dont know whether its possible. I did not do research on Google but I dont think even Google generates $10 per user. Moreover, I dont think this valuation madness is going to stop soon. I think this might just keep going up and up and up and hence more pressure on profits per user.

2.  Based on the above revenue and profits figures, it seems Facebook is commanding PE multiples of almost 150.

Wow! havent heard about these PE multiple since the bubble of dot com. When investors are willing to give that kind of PE multiples, they are obviously expecting some kind of stupendous future growth. But how much for the next 5 years – 50%? 100%, 200%? To understand again did a quick maths and compared these figures with Google (online company similar to Facebook) and Apple (not a similar business model but a company growing stupendously). Surprisingly both Google and Apple command a similar multiple of 20-21(based on todays data) with very different growth rates. Google has been growing its profits at the rate of 26% in the past 3 years and apple has been growing its profits at the rate of 60% in the past 3 years. I know PE multiples are based on future growth rates buts in the lack future forecasted data, I am using historical data.

Lets compare Facebook PE multiples with Apple first. So for Apple – 60% growth rate and 21 PE multiple. This gives the PE/Growth ratio of 0.3 If we use the same ratio for Facebook then that would mean investors believe that facebook is going to grow its profits at the rate of 420% every year for the next few years. Wow – again not sure if thats possible. Not sure if Facebook did that in the past years on the smaller base.  This comparison seems to be too harsh. Now lets take the comparison of Google – 26% growth and 20 PE multiple giving PE/G of 0.76. Now if we use this ratio for Facebook, it would mean investors are expecting Facebook to grow its profits at the rate of 185% every year for the next few years. That is almost tripling profit every year – meaning 1.5 billion dollars in the year 2011. 4.5 in the year 2012 and 13.5 billion dollars in the year 2013. Again just seems too much  and too optimistic.

Based on the above two analysis, I have some serious doubts that investors would be able to make money from this investment in the long term. For me the investment seems more of a fad rather than some logical rationale behind it.

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Last couple of years have seen rapid developments in the Internet and mobile space and now the two are tightly integrated together. Here are our top 20 Internet and Mobile trends:

1. Mobile ramping up significantly and faster than anything in the recent past
   • Smartphones > PC sales within 2 yrs
   • Mobile data usage likely to shortly overtake desktop internet access
2. Intensifying OS battles
   • Attackers driving market excitement and momentum
   • Single OS across screens (Mobile, Tablet, PC, TV)
   • Smartphone platforms = brand to the consumer
3. Increasing digitization (content, medium, process)
4. Apps, Apps, Apps !
   • Native apps stymieing open web
   • App Stores – Significant content distribution platforms. Enabling long tail content
   • Across Platforms (TV, PC, Tablets, Mobile)
   • Increasing Personalisation via apps (consumer life dashboard)
   • Big brands rushing our mobile apps & seeing tremendous traction (e.g. EBay, Amazon)
   • Some social game audience now = Prime time TV audience
   • Viability challenges for larger community of developers
5. ‘Social’ization of everything (search, commerce, gaming, advertising)
6. Smartphones & now Superphones!
   • Increasing capability - Processing, display. Battery technology lacking
   • Tighter internet integration
   • Easier to use – UX innovation
7. Emergence of Apple, Facebook and Google ecosystems
   • Different platforms with rapid innovation and different plays
8. Rise of the Mediatek ecosystem in Asia
   • 400+ M phones a year + suite of white label services
9. Brewing battle for online Identity Management
   • FB & Google competing ferociously to own the online consumer’s identity
   • As online identities become more widely used in hiring practices, sites like reputation.com will compete for the opportunity to help protect and bolster online identities
10. Emergence of HTML5 & Web apps
11. Increasing leverage of location & presence awareness
12. Rising importance of Mobile Money
13. Rapid Biz Model Innovation
    • In-app sales, Groupon, etc.
14. Increasing focus on Monetization (FB, Twitter, YouTube)
15. Rise of the Connected TV
    • Home entertainment & communication hub
16. Growing momentum for mobile advertising
    • New formats
    • Plethora of entrants with ad platforms from amongst IT and telecom vendors
    • Ownership of ad platforms and ad-networks becoming the next battle battle ground
17. Revolutionizing Retail Commerce
    • Mobile – Location based, discounts, transparent pricing, etc.
    • Leveraging group buying power
18. Media Trends
    • Growing video play
    • Increasing traction for eBooks
    • UGC content accelerating
19. Increasing leverage of internet by enterprises – SaaS, Cloud computing
20. Convergent Communications
    • SN increasingly platform for all forms of communication
    • Mobile, PC & TV support for convergent communication

Request the readers to comment on the trends and add in case we have missed any trend.

(Navdeep Manaktala is co-author of this article; image courtesy Schoolfusion.us)

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The ability for mobile phones to be used as payment devices has long been seen as the holy grail for both phone companies and banks. Google’s unqualified support to NFC (Near Field Communications) through integrated NFC in Android phone (version Gingerbread) has led to increased speculation on the potential uptake of mobile payments in the next few years. Mobile payments is one service that has caught attention of all the players of the ecosystem – banks, payment gateways, handset manufacturers, entrepreneurs and operators despite it being a low margin business. As tariffs for conventional calls fall and competition from cheap or free calls over the internet heats up, phone companies are increasingly looking to new applications to boost revenue.  However, there is more to mobile payments than the mere VAS service for mobile carriers. This article is an attempt to unravel the mobile payment puzzle.

Reasons for attractiveness of Mobile phones for payments

There are several reasons for this euphoria about mobile payments and some of them are listed below:

1. High penetration of mobiles: The mobile phone today is the most penetrated electronic device across all categories. There are over 4 billion mobile phone users in the world that hugely surpass the number of credit/debit card owners.

2. Ubiquitous: Every morning before leaving home, people check for keys, wallet and phones. People carry their phone wherever they go and hence there can be no better device than a mobile phone for payments

3. Personal Connected Devices: The mobile phones are personal, portable and connected devices which gives it an advantage that no other device can even get close to. Since the mobile phones are connected, the users can be contacted and instant offers can be given in a non-intrusive manner. NFC chips or stickers can be added to the mobile phones to make the payment simpler and faster.

Why is Mobile Payments increasing in importance?

The card industry is maturing and hence the financial sector players are looking for new channels. Telcos and device manufactures want to increase their revenues and they see high potential in mobile payments. In fact if there is convergence in views on potential of any mobile service, then it is mobile payments. As per a report from Arthur D. Little, the mobile payments are expected to grow at 68% annually as compared to 5-6% for credit/debit card users.

It is interesting to note that emerging markets especially Asia is like to grow much faster than the developed markets with the emerging markets capturing 76% of the mobile payment transaction revenues. Gartner predicts that by 2012, the number of people using mobile payments would reach 190 million which would still be less than 5% of mobile base. Another estimate from Juniper puts the potential of mobile payments at $680 billion by 2014. This implies that the potential is huge which is attracting all the industry players.

The current credit cards and debit cards are not suitable for micro payments. A micro payment is a financial transaction involving a very small sum of money usually less than $12 (as defined by PayPal). The transaction cost of micro payment is very high for traditional payment methods but the evolving business models in mobile value added services, digital goods and Internet require small ticket size transactions.  It is expected that mobile payments would ultimately reduce the cost of transaction making micro transactions viable. Even in the physical world, credit card companies see pay-by-mobile as a way of encouraging people to make small purchases that are currently made with cash, on credit. By volume, two-thirds of  payments in developed economies like UK, US, etc. are still made by cash, so “mobile wallet” would give credit card companies a slice of these cash transactions.

The use of mobile phones for payments is looking such an attractive proposition that companies like MasterCard and Visa are worried that if the consumer preference changes in favor of mobile payments, even the current business would be under threat. The problem of these companies is the fact that their business model evolved much before the arrival of Internet or mobile and they simply tried to apply the same model on the Internet. Paypal on the other hand was born out of necessity in the digital space and now the virtual currency (e.g. Facebook Credits) is expected to take over the digital world. In middle of all these changes, many traditional payment organization are at a loss when it comes to the challenges from the new companies.

Now the game is moving to a completely different level. Payments is just a part of the overall game plan, the real catch is the lucrative mobile commerce and mobile coupons. Relationships with the merchant are likely to take the center stage and the mobile payment companies would be in the best situation to take advantage of the growing mobile commerce. The image alongside shows the key components of the mobile commerce ecosystem. Mobile coupons and loyalty would be big but not bigger than payments. The relationship between retailers and mobile payment players would be the key and hence the mobile coupon and loyalty players would need to tie up with the mobile payment players. In other words, mobile payment players would play a central role in the mobile commerce ecosystem. The potential of mobile commerce is huge and hence there is so much interest in mobile commerce as they see it as a gateway to success in mobile commerce.

Health care sector has always been at the forefront of any technology adoption. In the recent past, there has been considerable interest in utilizing the mobile phones to provide health care services to the billions of people across the world. Mobile phones are a great leveler and have democratized the access to health care. Increasing mobile penetration especially in the rural areas means that even the poorest of the poor can potential benefit from mHealth. The need for use of mobile technology in health care transcends across geographies and income levels. It is myth that mobile health or telemedicine is a need for emerging markets where the health infrastructure is poor. mHealth is equally important in developed nations which are struggling with rising health care costs.

What is mHealth?

mHealth is a term used for the practice of medical and public health, supported by mobile devices. mHealth applications include the use of mobile devices in collecting community and clinical health data, delivery of health care information to practitioners, researchers, and patients, real-time monitoring of patient vital signs, and direct provision of care (via mobile telemedicine).

How large is the opportunity?

Opportunities in the global mobile healthcare market are estimated to be worth between $50bn and $60bn in 2010, prompting operators to step up their initiatives in this emerging sector. The figures come from a global market survey from management consultancy McKinsey & Company, and suggest that mHealth opportunities in 2010 could be worth $20bn in the US alone.

To test consumer demand for mhealth services, McKinsey conducted a global market research survey of 3,000 consumers in six countries (500 each in Brazil, USA, Germany, South Africa, India and China). The findings indicate that a large proportion of the four billion people using mobile phones today struggle to gain access to good quality and affordable health care, both in emerging markets and more developed societies.

What is working in favor of mHealth?

1. Mobile phones are the only ubiquitous devices: There are over 4 billion mobile owners across the world which means that around 70% people own phones and over 90% of world’s population is covered by mobile network. The mobile phone is always carried by an individual making it an ubiquitous device and hence best suited for providing health care. There is no other personal gadget apart from a wrist watch that comes even close to mobile penetration. Even wrist watch is losing its relevance to mobile phones !!!

2. Increasing data speeds: Most of the countries across the world have rolled out the 3G networks and some are rolling out HSPA and 4G networks. The high speed networks facilitates telemedicine and remote diagnosis.

3. Lowering tariffs for voice and data: Lower tariffs leads to higher penetration and usage which is good for mHealth. Lower data tariffs are particularly encouraging. As networks upgrade from 3G to HSPA to 4G, the bandwidth costs are going to come down significantly leading to even lower costs in future. However, operators may take time in taking the high speed networks to rural and smaller towns.

4. Better handsets: Over the last few years, the smart phones are getting better and now provide the same computing power as computers used to provide just 3-4 years back. This means that the remote diagnostics, access to web based patient information system and telemedicine via video conferencing are now possible on the mobile phones. Though the smartphones are not very prevalent, but the medical centers in far flung areas can have a few smartphones catering to hundreds of patients.

Emerging opportunities in mHealth

1. Information/ Awareness: In health care, it is very important to be able to inform the vast majority of the population about a medical campaign. The Polio awareness campaign in India which has been supported by mobile operators is a very good example of how awareness can help eradicate the dreaded disease like polio. SMS messages can be sent out to millions of people as part of awareness program. Voxiva in Mexico gives people living with HIV the ability to register to receive messages to help improve their adherence to their specific treatment.

2. Medicine Reminder Service: Some people need to take medicine at regular intervals on a long term basis. Many patients, especially seniors forget to take their medicines on time. It is not practical to set alarms on the phone as it would require multiple alarms. In my opinion, a service that can send out alert messages or calls to remind people to take their medicines would be extremely successful. Imagine a situation where somebody’s parents are living in a different city and are required to take multiple medicines. Any son or daughter would like to take care of their parents but cannot always be physically present. If there is a service where the entire prescription can be uploaded on the cloud and the alerts are sent out basis the prescription, it would give a lot of mental peace to everybody in the family. The alerts can be in the form of  SMS or auto-dialers. There are a few services like medication-reminder, ePill, OnTimeRx, etc. but there is scope for many more such or improved services.

3. Remote Consultation: Remote consultation is consultation between patients and doctors when they are not physically present at the same place. It is very useful when:

• The patient lives in a remote region where travel would be financially difficult
• The patient is hospitalized or otherwise too ill to travel
• The history and examination are well-established: there is simply a need for more diagnostic or therapeutic suggestions
• The diagnosis is known and specific treatment options are requested

In such situations, remote consultation can be done with the help of health workers or junior doctors. A big opportunity is in facilitating remote consultation with expert doctors across the world. A person sitting in Nigeria can get expert advice from a doctor in New York at a faction of the cost of physical visit. A pilot program is being run in Southern Ghana to bridge the gap between doctors in under served regions with local shortages of medical expertise and medical specialists worldwide. This pilot is being run on computers but similar services can now be piloted on mobile phones as well. McKinsey estimates that remote consultation on mobiles itself can be a $10 billion opportunity.

4. Remote Monitoring: Recently, I came across a blood sugar monitoring service by the name of MyGlucoHealth which has an app that enables users to transmit blood glucose testing results from a MyGlucoHealth Wireless meter through the user’s mobile phone (using bluetooth) to a personal health record. Patients can also review their most recent blood sugar test results, view line charts, pie charts and histograms, as well as enter, fitness, weight, exercise and nutritional data. The beauty of the product is that any family member can monitor the progress of the patient. This application is again attempting to not only provide the health record but also giving the opportunity to family members to view the report and monitor the progress. Most of the downloads of this application are from US, India, Saudi Arabia and Latin America.  There are similar opportunities waiting for entrepreneurs to take benefit of the $50 billion opportunity.

5. Diagnostics: Mobile phone is a good example of integrating features from other industries e.g. camera, radio, torch, etc. However, no widespread attempt has been made to convert the mobile phone itself into a diagnostic instrument. Recently, I read about researchers in Uppsala, Sweden, who are developing a portable laboratory that enables mobile phone users to conduct a quick and accurate analysis of blood samples. A disposable microfluidic chip that is able to analyse blood samples and thereby identify inflammatory conditions, the need for antibiotics and the risk of heart disease. If true, this coupled with remote consultation can be a real boon for people living in remote areas. Even people in urban areas and developed countries can benefit from cheaper and convenient method of diagnostics.

Health Monitoring services may include a SIM embedded biosensor watch that monitors vitals, and is connected to the emergency services. Such services can send automatic alerts if there is something wrong in any of the key vitals.

6. Emergency Services: Communication and alerts are the best tools to fight any disaster or emergency. Mobile phones have proved to be handy in disasters such as Tsunami in South Asia or earthquake in Haiti. US and now Europe are attempting to use location based services for emergency services and response. Mobile towers are used to provide the location of the emergency. In Haiti, over $1.5 million were collected by using mobile donations and immediately after the earthquake, Ushahidi helped prioritize the locations which were in need of help. Ushahidi is an open source project that allows users to share information during crises. People can share information over the web or using mobile phones.

7. Helplines: Helpline typically consists of a specific phone number which any individual is able to call to gain access to a range of medical services. These include phone consultations, counseling, service complaints, and information on facilities, drugs, equipment, and/or available mobile health clinics. Helplines are available in many countries though the scope varies a lot. In many countries, the helplines are run by governments and NGOs but now even the private companies and operators are waking up to the potential of helplines.

Summary

The mHealth opportunity is huge but it would need close cooperation between mobile operators, handset vendors, hospitals, medical device manufacturers, health insurance companies and the Government authorities. Many operators like Vodafone, O2, Bharti, etc. have already formed health verticals within their organizations to exploit the mHealth opportunity. However, I would caution the operators against treating mHealth as another value added services as this would require a lot of support from doctors and health workers. There needs to an ecosystem that needs to be created for mHealth which would be distinct from the mobile ecosystem. With opportunities like mHealth, I am sure that there is a lot of steam still left in the telecom space and we have only scratched the surface of the opportunities.

Alison Bloch, m-Health Advisor at GSM Association, Talks About m-Health Alliance

http://www.youtube.com/watch?v=aAKcJwT9b6g

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There has been a lot of talk about the application economy and how has it changed the consumption of mobile internet. The contribution of application stores towards making applications a huge success cannot be ignored. However, there is still room for improvement and below is my list of five things that I hate about applications:

1. Applications are lost on change of handsets: Mobile phones, unlike computers, are changed much more frequently by the users and in many cases they are changed within a year. Users download applications over a period of time and start to store critical data on the applications. However, when they change their handsets, the applications cannot be transferred to the new handset. The users have to download the applications again which is not only a waste of time but can also be expensive in case of paid applications. Moreover, the data stored via applications on the old handset is lost forever. If the mobile ecosystem does not pay immediate attention to this problem, then it is possible that in future people would just not download paid applications or would not care to download applications all together.

2. Frequent updates to applications: The developers keep adding the functionality all the time and push the updated applications to the end users as software updates. For heavy application users, at any given point of time, there are applications waiting to be updated. Imagine if the applications were hosted on the web instead of being native, then there would have been no need for the application to be updated all the time. A cache version could have been used at times when the connectivity is not available.

3. Portability across platforms: All the applications are platform or OEM specific. Applications that work on iPhone do not work on Nokia and that work on Nokia do not work on Android. The cost of cross platform development is high and on top of that the application store owners act as gatekeepers to the applications which means that there is a possibility that an application may not be able to make it to all the application stores. Moreover, the user experience on the same application is not the same across different operating systems. As a consumer, I do not want to be tied down to any one specific handset brand to be able to use my favorite application.

4. Links do not open inside application: Today, when I use any application, the links open up in the mobile browser and not within the application. This is very annoying and a very big reason why the mobile application advertising has not taken off in a big way. Steve Jobs has talked about this issue but I do not see things changing anytime soon. Toggling between the mobile browser and application is a pain and many a times, I do not open the link unless I really find the description interesting

5. Applications drain the battery fast: Most of the applications are not optimized to low power consumption. By following a simple rules, the applications can be much more energy efficient which the application stores completely ignore while acting as gatekeepers. I need to charge my phone many times in a day to be able to use the applications or simply need to switch off the applications to conserve energy for voice. For me voice takes precedence over applications but then I am not able to take full advantage of the applications. I believe, it is the combined responsibility of the operating systems, OEMs and developers to make Green Applications that consume less power. OEM on their part should look to increase the battery capacity that can do justice to the high end phones.

This was my hate list of applications. Do comment on what you hate the most about the applications.

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“Don’t be evil“ is the informal corporate motto of Google, originally suggested by Google employees Paul Buchheit and Amit Patel at a meeting.  Google has the philosophy that”You can make money without doing evil.” Google claims to have made “Don’t Be Evil” a central pillar of their identity, and part of their self-proclaimed core values. Google has been accused of deviating from this motto a few times in the past. In 2006, Google reached a deal with China and censored search results as part of the Golden Shield Project of China. The argument changed from “Don’t be evil” to “Evil Scale” in case of China. Steve Jobs accused Google of back stabbing by entering into the phone business and now the policy proposal along with Verizon this month seems to be last nail in the coffin.

One company for which I had utmost respect was Google. However, my faith in the company is now shaken after the policy framework it released along with Verizon in US in a bid to control the wireless internet (Download Verizon-Google-Legislative-Framework-Proposal to read the fine prints). In the proposal, it is clearly mentioned that for Wireless Broadband, the non-discriminatory requirement would not be applicable. This means that a service provider can engage in undue discrimination against any lawful Internet content, application, or service in a manner that causes meaningful harm to competition or to users. In other words, Verizon would decide in US which content and application can get priority over others and Google by virtue of its dominant position, would get a preferential treatment. It is like two giants coming together and deciding that no new service or application can come up unless it has their blessings.

Most of the industry observers have termed the action of Google as end of net neutrality which would lead to a two tier internet. One super fast internet for the privileged content and the other for the less privileged like the startup firms. First of all there is no logic for applying different parameters to wireless broadband and wired broadband. Yes, the carriers are making investments but the investments in the wireless broadband are less than that in the wired broadband and with technological advancements, the bandwidth cost is coming down drastically as carriers move from WCDMA to HSPA to 4G.

The network carriers have been indulging in acting as toll gates in the past. Many carriers across the world have restricted or slowed access to the peer to peer (P2P) file sharing services like BitTorrent, FastTrack, etc. In October 2007, Comcast, one of the largest broadband internet providers in the USA, started blocking and jamming P2P applications such as BitTorrent. Their rationale was that P2P is mostly used to share illegal content, and their infrastructure is not designed for continuous, high-bandwidth users. The network management clause gives partial legality to this action under the disguise of reasonable network management to reduce or mitigate the effects of congestion on its network. One of the core issues behind the network neutrality controversy is over P2P applications.

Apart from P2P file transfer, the carriers would also try to block Skype, Pandora and other VOIP services to protect their voice revenues. The operators can be transparent about blocking VOIP services but it does not help the consumers in any way. Will they treat the Google Voice the same way as Skype or Pandora? Knowing Google, I am sure it would be willing to do a revenue share with carriers to get carriers to allow Google Voice.

I am particularly worried about the startups companies as any technology that would threaten the carriers either from the service point of view or from bandwidth requirement point of view is likely to be be blocked on wireless internet depriving the consumers of any innovations. Imagine a situation where a startup were to come up with a service that can threaten the carriers or the allies of the carriers, in all probability the carriers are likely to block the service. It is very much evident that the wireless internet is the next big thing, even bigger than the wired internet and hence it is imperative that we do not create unnecessary hindrances to its growth.

Wireless carriers are trying to manage their relevance so that they do not become a dumb pipe just the way it happened to the wired carriers. This explains why Verizon is a party to this recommendation. Coming from the industry giants is going to put extra pressure on FCC. Even AT&T is not averse to Google and Verizon’s position on net neutrality in the wireless industry. The proposed penalty for violation of consumer rights like failing to be transparent would by just $2 million which the carriers would happily part with if they can hurt the smaller competitors by blocking their service.

All in all, if these proposals are excepted by FCC, the consumer would be the loser. To summarize, I would borrow the quote of Jeff Jarvis of Buzz Machine who called this proposal a Munich Pact.

Netizens are now citizens of the Sudentenland. Just as Czechoslovakia was not invited to its cutting apart, so were we not invited to Google and Verizon’s parlays.

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Internet changed many industries but its impact on the retail industry has been the maximum. The value chains and the supply chains changed dramatically especially in the developed countries due to fixed internet. Now the mobile internet is changing the way people shop but its impact is significantly different from that of fixed internet.

Retail industry has a variety of players from organized players to mom and pop stores. There is always a never ending tussle between the different players in the retail and also between the manufacturer and the retailers. In fixed internet, the manufacturers saw an opportunity in reaching out directly to the consumers, bypassing the retailers. The retailers felt threatened and they saw declining footfalls but could do little. Declining footfalls made retailers reevaluate their store and location strategies. New players like Amazon emerged while the brick and mortar retailers like Barnes and Noble struggled. However, with mobile phones, the retailers have an opportunity to engage with their consumers in a way that would attract them to their stores. Mobile phones can not only increase footfalls into a store but can also be used to give superior in-store experience. The capability of mobile to drive “online traffic to offline” stores sets it apart from the fixed internet.

Retailers pay a high rent in the malls or high street and can recover their investments only if there are higher footfalls. Physical presence also means that the sales person can convince the buyer to buy more. For this to happen, it is important to convert online traffic to offline traffic into the stores. Retailers are now planning to capture the attention of potential buyers on the internet or mobile and do the fulfillment at the retail point. The mobile phone can be used to locate a store, create effective loyalty program, convert a non-user through real time coupons, advertising and alerts. All these applications have the potential to increase the footfalls at the retail point as the consumers can find out about the stores and the deals available while on the move.

Foursquare is a highly popular mobile application available in the US which is tracking the consumer locations and rewards the loyal customers of a store or coffee outlet. Foursquare gives opportunity to small business to benefit from the location of a potential buyer. A bar can run promotions not only when a person checks into the bar for the first time but also when the person checks in after a certain number of times. The stores can pull the consumers even when they are around the store by pushing promotional messages. Foursquare is clearly giving tools to the retailers that can help them increase footfalls by rewarding loyalty. Pepsi has tied-up with Foursquare to take advantage of the location based marketing.

There are several applications on iPhone application store that enable the retailers to give promotional coupons to mobile users. Free mobile applications, such as Yowza, Coupon Sherpa, MobiQpons, and Cellfire, allow consumers to check for nearby businesses offering special deals. Because mobile coupons target customers who are near a store’s location, the redemption rates can exceed those of paper coupons. These applications are again increasing footfalls to the retail stores.  Starbucks has successfully used mobile coupons to increase footfalls to its cafe.

Imagine a situation where a movie theater dynamically offers discount coupons to fill up the hall on weekdays or a retailer can push a coupon to sell if he knows that the consumer has brought products from competitors or products complementary to what he sells. Perishable goods can benefit hugely by pushing mobile coupons in the evening based on the inventory. This would help the retailer to sell the stocks at full price if there are buyers instead of offering discounts after a certain time say after 8 PM for the bakery products. The bakery just needs to push a discount coupon to mobile users in the vicinity if it is unable to sell the inventory and it can do that even before 8 PM. Again this is driving the online traffic to offline stores but profitably.

What enables the mobile to drive online traffic to offline store?

There are many features in a mobile phone that the PC can never match:

1. Location: Mobile phones can provide the location of the consumer that allows targeted advertising and location specific offers and deals
2. Personal: The mobile device is a personal device. This means that unlike PC that is shared by many users, the mobile phone’s usage can be mapped to individual characteristics and behavior.
3. Always On: Another positive feature of a mobile phone is that the device is always on and is always with the user. It is possible for the retailers to push real time coupons, offers or advertisements.
4. Larger Penetration: Mobile phones have a much higher penetration than the computers across the world. This means that the mobile phone has a larger potential as compared to computers especially in the emerging markets. Today, there are more smartphones sold than the desktops which has suddenly changed the dynamics in favor of smartphones. If you add tablets, iPads, iPods, etc. to the list of portable devices, then the devices that are carried by consumers become much larger in number than the desktops and laptops.
5. Camera: Most of the mobile phones come with camera and hence it is possible to convert them into bar code readers that can help the consumers in finding more about a product or even compare the prices of the same product in the location around them.
6. Additional channel: Mobile represents an additional or incremental revenue opportunity because people can buy anytime and anywhere. Mobile also helps in directing footfalls to a physical store as many consumers want to touch and feel the product before buying and in this case the mobile phone acts as a discovery medium. Many retailers like Ikea, Next, etc. have a mobile store but the fulfillment in most of the cases is happening in the stores.

The potential of mobile phone is immense but the retailers need to have a well thought out mobile strategy. The mobile strategy is completely different from the internet strategy and it is critical for the retailers to hire people from the mobile industry to manage the mobile channel or outsource to the people who know mobile the best.
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Over the last many months, I have received numerous requests and gifts in my Facebook account from a game called Farm Ville. There is a friend of mine who is regularly playing this game and updating her status with the levels she has managed to crack in the game. I too played this game for a while and found pretty addictive but never realized that just within a year of its launch, FarmVille has become the largest online game with over 82.4 million active users (over 1% of world’s population).

Zynga’s Farm Ville has become symbol of success for social games but there are many other players making significant strides. In last one month, I have come across multiple VC investments or acquisition in this space. MTV networks acquired social game developer Social Express (MTV will use Social Express to develop games based on TV shows from MTV,Nickelodeon and other Viacom-owned brands), Playdom brought Metaplace apart from 5 other acquisitions, Disney brought game maker Tapulous, Zynga brought Challenge Games and XPD …. and the list goes on. This flurry of activity started last year when EA acquired Playfish for $400 million. Recently, there is another rumor doing rounds that Google has secretly invested $100-200 mn in Zynga and gaming would be the cornerstone of Google Social Networking site. Zynga managed to get half a million VC dollars last year and is estimated to have clocked $350 million as revenues. Zynga has a big hand is making Facebook popular and is the biggest customer of Paypal.

What is Social Gaming and how is it different from Multiplayer Gaming?

Social games are turn based, multi-player games that use social platforms to provide users with an identity and to provide the backbone for simple forms of communication (such as notifications, etc). Social gaming is probably not for hard core gamers and is more likely to attract casual gamers. The key component of social gaming is awareness of other’s actions in the games which acts as catalyst to attract other friends in the network. Top social games are Farm Ville, Texas HoldEm Poker, Cafe World, Mafia Wars, etc.

Social gaming companies rely on turn-based asynchronous game mechanics to lower the stress level and focus on playing with your current circle of friends. Games such as Warbook, Ikarium, and Friends for Sale have the benefit of closely matching the current behavioral model of social networks in which posting to walls and poking one other serve as the primary modes of communication. These games allow users to take time to make their decisions, they integrate well with a players current set of friends, and they do not require the “presence” that real-time games require. Multi-player games in contrast are synchronous games.

What makes Social Gaming a game changer?

People seeking cheap, escapist gaming fixes during the downturn has seen social gaming reach hundreds of millions of consumers globally leading to social gaming being named by Brandweek as one of the Top 10 digital trends to watch in 2010. There are many reasons for success of social gaming and the prominent ones are as follows:

1. Ability to use social graph of users

Zynga has shown how to creatively leverage the social graph to spread the word around about the application. Continuous postings and poking help generate the interest of non users to casual gaming. There are over 230 million social gamers playing games like Farm Ville or Mafia Wars.  The games involve gifting and rewards which keep the game’s interest in the game.

There are possibilities of cross selling other games from within a game like in Farmville, players are encouraged to play other games from Zynga (“Did you milk the cow? Take a break with a milkshake in Café World!”).

2. Sense of Achievement and need to consistently maintain high score (Engagement)

People are looking to be successful at things. Its hard to get ahead in business or careers, many things in life aren’t noticed as true achievements as they should be. People find these games addictive because they give them a sense of accomplishment and give them opportunity to achieve more. They like to announce their achievement to their friends and continue to play to get to higher levels. Social games are high maintenance games and the hard work goes waste if the user does not play the game regularly… the more you play, the higher are the chances of a high score. Social games are like soap operas that never seem to get over.

3. Micro-payments boosting Revenue Generating Opportunities

It has been seen that if a game is charged upfront, few users are willing to pay but the users are ready to pay for smaller value items that might be required to boost their score, e.g. a car racing game can be free but users can be asked to make small payments for alloy wheels or better engine or better looking car. Since the game is social in nature and the payments are of smaller denomination, the users do not mind paying for them. This strategy has led to huge upsides to the revenues of the social gaming organizations. About $1 billion revenues are expected this year from social gaming and still it is considered under-monetized.

4. Advertising Opportunities

The advertising on social games has so far been limited but has a huge potential. According to industry insiders, active social gamers spend anywhere from 45 to 90 minutes on the games providing ample of opportunities for advertising. Microsoft used advertising in social gaming when they launched Bing.com. Sony is promoting its Vaio Laptops on this media. In-game advertising is a huge opportunity waiting to be exploited. Many companies from movies and music to FMCG are likely to add social gaming as part of their marketing mix.

5. Key Statistics look encouraging

According to a survey commissioned by Popcap Games, an average gamer is a 43 year old woman (sorry all stereotypes on the gaming profiles have been proven wrong!!!). Other findings include – Facebook is the most popular destination for online games, with 83% of respondents saying they have played games there. Twenty-eight percent have purchased in-game currency with real-world money. The average gamer has played six social games, and more than 50% of gamers started playing a game because a friend recommended it or because they saw a friend playing it in a news feed or other social stream. Now this is viral effect!

6. Potential on Mobile Phones

The social games can be played on mobile phones. Imagine, you can continue to gain points on Farm Ville by playing on your mobile when you have free time – it will be highly addictive. Also, the total number of mobile phones far outnumber the PCs in the world. In case of social gaming, the primary user is a woman and in emerging markets, the women normally have a mobile phone but do not have access to a PC. Also, on the mobile phones, context (location) can be added to the game giving  a completely new dimension to gaming.

7. Use of Virtual Currency

Anybody who has played Farm Ville on Facebook would be aware of credits that you need to buy virtual goods. The virtual goods can either be earned by playing the game more often or by participating in research or by participating in viral marketing or by simply buying using real cash. The value of virtual goods was almost $9 billion in 2009 in Asia and $1 billion in Western countries. It is expected that the virtual money would continue to rise and has the potential to be used in both physical and online world. The advertisements are likely to become more engaging and interactive with the advertisers doling out virtual currency or goodies. So much so that Lolapps has predicted in a report that by 2015, the Government will regulate virtual currency and try to attach its value to real currency. Already, virtual goods are taxed in China and South Korea.

Summary

Social gaming has a huge potential and is not only a game changer for the gaming industry but also has a potential to impact the growth of social networks. Google is planning its social networking site with Gaming as one of the key plank. With social networks permeating our daily lives, entertainment is being redefined and social gaming is here to stay.

*** For those who do not know about Farm Ville ***

Farm Ville is a real-time farm simulation game developed by Zynga available on the social networking website Facebook. The game allows members of Facebook to manage a virtual farm by planting, growing and harvesting virtual crops and trees, and raising livestock.

FarmVille leverages the social networking aspects of Facebook. Along with their own farm, players can invite their friends to join and be neighbors. Acquiring neighbors has benefits in game play — not only can one earn money and experience (by visiting and helping on neighboring farms), but with eight or more neighbors, a player can expand their farm and own more acreage. Gifts (such as trees, animals, and decorations) can be sent to both confirmed neighbors and any other Facebook friends even if they do not use the application. The Gifts received from neighbors usually have relatively expensive buy prices in the market; so getting gifts from friends is one of the best ways to get relatively expensive items. Many of the items available to gift to friends are not available in the FarmVille market.

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Word of Mouth has been the oldest marketing tool but was relegated to the background due to higher popularity of direct advertising. In the last century, the mass media became popular and direct advertising soon became a great tool in the hands of the marketing professionals. At that time, the number of TV channels were few, newspapers were few and the radio channels were also few so if you broadcast your message, almost everybody is bound to notice the advertisement. However, things have changed now with the expansion of mass media. Higher number of TV channels mean that the companies have to spend much higher to reach the same number of people. Even on the same channel, there are more companies advertising which means that an average individual sees 1000-4000 ads in a day.  Moreover, there is a degree of distrust in direct advertising and people are more willing to rely on the recommendations and consumer opinions (refer to the survey from Nielsen below).

Given the fact that the word of mouth and recommendations from known people are trusted more that any other form of advertising, it is important to take full advantage of the social media which includes the entire conversational media like social networking sites, blogs, forums, etc. It could be a great tool to attract new customers and give confidence to the existing customers that they made the right decision by choosing your brand.

Booz & Co has identified six elements for creating online customer lifetime value.

The next generation of successful online business models will combine the elements of a traditional retail site—trust, ease of use, and personalized offers—with social apponomics features, such as personalized advice, community, and the functionality of customized applications

Social media would enable the companies to create a community that can be used as a test market for bouncing off ideas and can also provide personalized proactive customer support. However, the first challenge is to create the community and then the second challenge is to to keep the community engaged. If we can overcome the two challenges, the viral marketing is mostly likely to be successful. I would explain  and list the various possibilities in social media by taking examples of online business or a mobile application but these may equally be applicable to any other business:

1. Use Facebook Connect:

An average individual has over 10 virtual identities (ids) on the net and at most he or she is able to remember 5-6. Last thing anybody wants is to create another id and any new website wanting its customers to create a new log-in id for its site is sure to put off a lot of customers. With almost 45% reach, every second person on the web is likely to have a Facebook account which can be used as log-in for any site.

2. Create applications for Social Media

If people are looking for recommendations from about existing users, then provide them that information using creative applications that post reviews and activities on Facebook, Twitter, etc. So, if there is a website that books movie tickets and gives great deals to its users, then it should create an application where the users are prompted to post the purchase on the social networking sites. Since the customer got a good deal, he would want to announce it to the world and satisfy his ego and at the same time it might entice the others in his network to avail the same deal from the website once such information is posted on Facebook.

Businesses may also look to create applications to increase the awareness about its brand and increase the usage. Pizza Hut’s page on Facebook announces all the deals that are available to its customers and has a application that allows the Facebook users to order their Pizza without leaving Facebook. I do not have statistics on usage of this application but I am sure it must be adding to the delight of the customers and may have snatched a few customers from Dominos.

3. Create Facebook Page

Having a Facebook page is a great way of not only reaching out to new customers but also keep them engaged and increase usage. Facebook page is the ultimate opt-in markting channel for any company. Coca Cola’s page on Facebook has over 6 million followers and this page is certainly adding to the brand value of Coca Cola (Click on the image below to see a clearer picture).

Companies can drive and measure response with special offers on the page and that would drive more fans to the Facebook Page.

Bad experience on Facebook page does not mean that the brand value would suffer. The cult following of iPhone has not dimnished due to a poor presence on Facebook. On the facebook page of iPhone, there is no information about the company, there are only 4 photos and almost zero engagement (click on image for better clarity). However, most of the brands are not as lucky as iPhone so ignore the power of social media at your own peril.

4.  Create Engagement Ads

Instead of serving direct ads, the companies can take benefit of the engagement ads available on Facebook. This would give a better recall to the brand as the engagement ads can be much more fun and interactive. If your social strategy relies on advertising in social media, it’s probably better to hang on to your money (Teddy Hall, COO Meteor Solutions)

5. Incorporation of a Facebook “widget” on the website

Show off your fan base by displaying the Facebook Widget on your website and add to the fan base directly from your website. This would help enlarge the community which is a captive audience for any future communication or test market.

6. Be visible on Social Media Sites

The top management should not only be present on Twitter, Facebook but also should be blogging about their companies. Zappos, an e-tailer has 500 of its employees active on Twitter ensuring there is ongoing conversation with the customers. They also take advantage of Youtube to facilitate word of mouth marketing and have 10 blogs to create an active community. Zappos was aquired by Amazon last year.

“You will make mistakes. If you are sincere about helping the community, the authenticity will show and your mistakes will be forgiven.” – Zia Yusuf, executive vice president for SAP’s global ecosystem and partner group. This quote from Zia sums up how should we approach the social media. If we are honest with the community, there is no reason why it would not reciprocate.

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Little did Google envisage the popularity of live online sports matches while signing the IPL deal. IPL is the Indian Premier League of cricket and is hugely popular amongst the cricket playing nations but there are only 12 cricket playing countries across the world (mostly countries that were colony of British empire at some point of time). Google beamed all 60 matches on Youtube with a 5 min delay (apart from US where the match telecast was after the completion of the match) for free supported by advertisements. With over 55 million views on Youtube from 200 different countries, the statistics surprised Google as well as the analysts. The viewers came from not only the cricket playing nations but also from many other countries, a fine example of long tail at work. The matches were played after office hours in India and hence Google had anticipated higher traffic from other countries but in the end, the highest traffic was from India. This was another learning that most of the households are single TV households and hence the online TV increases the media consumption. Despite the popularity of IPL on You Tube, the views on the traditional TV increased from the previous two editions of IPL.The matches were blocked on mobile phone and hence there is no data point available on its impact on mobile TV.

Internet TV is not a new concept. Hulu is a hugely popular online TV service in US with close to 20 million visitors to its site in US last month giving 662 million page views (source: Comscore). The popularity of Hulu has been on the upswing and if unique visitors is any criteria, then its visitors have increased by a huge 140% in last one year. The average time per visit is 4.7 minutes which indicates people are watching short videos on Hulu.

The inferences that can be drawn from the above two examples is that the internet channel is complementary to traditional TV and should not be seen as a competition by the TV industry. Internet is likely to bring in additional viewers as there are hundreds of channels but only 1 or 2 TV sets in a house and hence not everybody can watch their favorite programs. With internet, people can either watch multiple shows or different family members can watch what they like for short durations, e.g. during IPL, my wife wanted to watch her regular TV serials while I did not want to miss out on the cricket match; I watched the match intermittently for short durations on You Tube to know the score and how is the match progressing (cricket unlike football need not be followed for the entire match) while my wife watched her serials on television. The advantages of internet TV to the traditional TV are as follows:

1. Higher viewer ship: It has been observed that the number of people watching television have been increasing despite the advent of other media.  In 2004 the Kaiser Family Foundation reported that the average person aged 8-18 was spending almost six-and-a-half hours a day taking in some kind of media—television, films, music, video games and so on. By multitasking, they were able to cram eight-and-a-half hours of media consumption into that time. The researchers concluded that young people were “filled to the bursting point” with media. Whatever, responded their subjects. When the study was repeated in 2009, young Americans were spending more than seven-and-a-half hours with media each day, an hour more than they had done five years earlier (see the chart alongside). Into that space they packed an astonishing 10 hours and 45 minutes of consumption. Among other things, they were watching more television (source: Economist).

The internet TV can easily be beamed across the globe which means additional viewers. Also, people can watch it even when they are not at home which means additional time on TV.

2. Additional Revenues for broadcasters: TV channels should look at internet as an additional advertising revenue source. Hulu generated $100 million in revenues in 2009 purely from advertising and now it is starting a subscription services at $9.95 per month. Internet TV may not be able to sustain itself on its own in the near future but it can always act as an extension to traditional TV.

3. Better services to Viewers: Internet TV can offer services like personalization, interactivity, ubiquitous availability that are not possible in television. With internet, it is possible to make television viewing experience very social. I envisage multiple applications being developed just the way it is happening to the mobile world.

4. Targeted Advertising: The advertisers would benefit from targeted advertising on internet TV. On internet, it is possible to track the behavior of the viewer leading to better returns through targeted advertising.

Converging technologies are blurring the difference between different media. The trend towards convergence started with Direct to Home and set-up boxes on cable to facilitate digital transmission but now IPTV is in a way internet TV. Google is also set to transform the set-up boxes by brining in its Android platform to enable application development. There are ample opportunities for the TV industry to innovate and become more interactive and internet TV is the step in the right direction but the real fun would be to bring the internet TV on mobiles.

Today’s consumer is exposed to a lot of digital media and entertainment in multiple formats and over mutiple mediums. Broadcasters should aim at unifying their service offerings and provide a unified lifestyle to their subscribers. Mobile phones and computers would complement the TV viewing experience in future and all the strategies of the channel owners should be keeping this reality in mind