Despite the global economic downturn, India’s economy in 2009 will grow at 7 % (though that is less than the 9 % rate of the previous years) – and the media and mobile sector will be major growth areas, according to industry analysts.
They were speaking at the annual Indus Entrepreneurship Summit (www.TiEsummit.org), one of India’s best annual events for the world of innovation and startups. Held in Bangalore this past December, it drew speakers and attendees from dozens of countries, debating everything from new media and government regulations to mentoring and venture capital dynamics.
Here is what’s in store for India’s mobile sector:
1. Mobile subscriber growth will continue at current rates (6-8 million new users per month), and 80 % of this growth will be in rural India and smaller towns. “The growth will happen more along the highways of rural India than in the hallways of urban India,” said Mohit Bhatnagar, operating partner, Sequoia Capital India.
The mobile channel will be a key multiplier for economic activities, and will be felt even more so in rural areas, according to Rakesh Singh, COO, Spice Communication. Pricing will be an important consideration: the comparable pricing point for a mobile phone in rural areas is the cost of a bicycle. Mobile entertainment is also the only form of media entertainment in many rural areas, which are out of reach of FM radio station coverage.
Tipping points along India’s mobile journey have been the operator move to allow free incoming calls; India’s voice usage by subscribers is higher than in many other countries. Mobile voice services can open access to knowledgeable people which is very important for subscribers in remote rural areas, said Mouli Raman, CTO and Co-founder, OnMobile.
2. Many Indian IT and services company have focused on the export market, but the domestic mobile market itself has huge opportunities on offer. “We were spun off from Infosys to focus on the mobile market and initially targeted global customers – but after 2002 we concentrated on the domestic mobile market,” said Mouli Raman of OnMobile, which now has all Indian mobile operators as its customers.
The company offers everything from interactive voice services to integrated marketing, and after its success in India it is now expanding its focus to the rest of the Asia-Pacific market as well.
3. Mobile content will be a strong draw (especially entertainment like Bollywood and cricket), but content providers will have to work hard to find workable business models. Hence the real action will be in mobile applications.
Rahul Pandey, CEO, Mobile18, said his company has made significant progress with SMS and mobile Internet content from their media properties IBN Live, MoneyControl and CricketNext, with a mix of infotainment and transactional services.
For many users, their mobile phone is the only computing device they will ever have, hence the importance of mobile applications, Raman observed. An important lesson is that these services have to be very easy to use, to ensure rapid adoption and viral marketing effects. Mobile search is becoming important, starting off with music and expanding to other areas.
4. New growth will favour incumbent operators, and not the new operators who have been awarded licenses to offer mobile services. The new operators will find the going to be very tough, Bhatnagar predicts.
5. 3G services have been launched in India, but will not gain much traction in 2009 other than voice services. “Boring but efficient voice, and perhaps Internet browsing, will be the draw in 2009,” says Bhatnagar.
6. The combination of interactive medium, more gateways and feasible monetisation models will make the mobile Internet a ripe medium in India. “Ten years ago, we bet on SMS, and sold our company Unimobile to Ve