Interesting Time Ahead-Even Google will Make Search Irrelevant

Last two blogs we had seen how content and communication industry going through sea changes. There will be soon no more VAS as we may know them today. Further there is fight to get Ultimate primary ownership of customers among Social networking sites like Google, FB and telecom vetrans.

Customer is with service provider for 'connectivity' and eventual ‘connect’. Interesting to observe key decision driver here- Freedom of choice for connectivity experience or priority is primary ‘connect’ option. What am I prioritizing my FB/G+ ‘connect’ on any of Vodafone or Airtel OR I prefer Airtel over Vodafone for my ‘connectivity’ experience along with independence to choose ‘connect’. And then there are other sets of customers decide to go with Apple or Google nexus and whoever provides it best (enhanced way to‘connect’- makes spicy topic for another blog some time...)

Here I am trying to put one simplest aspect; but there are lot of stakeholders within complex environment combating for supremacy and coexistence to rest claim on ultimate primary ownership of customer. They are likes of service providers, social networking companies, ad-aggregators, Govt, media houses, content generator, influencers and aggregators, OEMs, OS-software giants, retailers, education and banking industries.
With this pre-text, I will like to draw your attention to few of these trend-setting business activities happening around the world:-
                  
1. Surge in options for wireless communication devices of  different sizes from 2'' to 10''

2. Great evolution in the space of larger devices like ipad, notebooks, and smart TVs

3. Multifold rise in data traffic anticipated by service provider- exploring options to offload data traffic from active wireless network

4. Lot of activities around wireless data- LTE deployments, Hotspot, Wi-Fi, mini BTS, asymetric up-down links, modify data packet structure, cloud services etc etc

5. S/w guys getting into h/w- Surface by MS.. Google integrating firmly with Motorola

6. Followed by Samsung-lead nexus partner- registering its displeasure and also exploring options to develop relationship around MS OS

7. S/w guys asking OEMs to adopt their OS- Google, MS, Nokia- mainly for wireless devices

8. OEMs creates modified OS to ensure all control does not directly transfer to OS provider

9. Players like Apple integrated end to end for providing experience

These differently looking activities are the part of one grand picture getting painted to make lot many business industries redraw their boundaries of influence/function. Yes! Busy time for lot of strategist to do intense environmental scanning, re-work their Porter model and refresh company’s SWOT and create greater blue ocean around in dynamic environment of connected world...  Excitting!!!

So quickly concluding what it meant at large by connecting these dots -

1. Mobility is must and hence at customer end wireless solution welcomed and limited mobility is optimal

2. Soon its just about what screen size satisfy your dominant need – cross working of functionalities among products-as we may know them today like mobile,notebook,tabs,laptop or smart tv,kiosks,e-displays,multiplex etc..

3. Users and companies will start talking about fulfilling end requirement and least about device, content, services or connectivity- fully integrated end solution driven model.

4. One who will own maximum mind share of customer in this connected world will optimize maximum profit share.

5. And primary owner of customer mind share has to create win-win situation to grow bigger otherwise there lies reverse critical mass.

6. Everybody including Google will try to make 'search' irrelevant. Soon 'search' will be expensive proposition. It is like through great deal of customer profiling RT insights, create AAI to know what customer wants before it gets on googling it actully.

7. Breaking advertising clutter will become increasingly difficult and you will require permission to interact with. Winning customer trust is paramount critical. There is scarcity of 2nd chance in connected world for breach of trust.

But this will not be end for any particular organization except one who remains adamant to maintain status-quo. Strategic direction may require paradigm change. Either You -
I) Have ultimate primary ownership of the customer OR
II) Build compelling features/ services/products/rich and very relevant content or simply create unbeatable economy of scale for the particular business aspect-(FAB) and thus support the one who has ultimate primary ownership. 

Hope I am able to convey my thoughts to you and ready to debate and discuss it further anytime. This is currently my favourite one..
--
Where,
RT = Real Time || AAI = Almost Artificial Intelligence

Two news draw my attention in last couple of days :-
1. Carier billing for google Play
2. Google's nexus strategic move- launching pure android experience with multiple vendors

What is so great! We had seen how Mr. G had disrupted content market, and even given run for their money to Mr. T as well. How Mr. G tried to make so called democratic market place. Now with this background when we combine above two news item. It will start making more sense.

One as of now Mr. G is trying to make peace with Mr. T. Red ocean to blue ocean strategy...
Another trying to bring more homoginization in terms of android experience with every upgrades.

This will try to reduce current concern of monitizing content other than advertisement revenue. These two develompment will put Mr. G in driver's seat in long run. Till the time user habit changes, content can be monitized with billing convenience offered by Mr. T. Ensuring developer community remain engaged with clear cut revenue stream from developing aps/games for android platform.

By ensuring more synch between all OS release, again helping aam zanata (developer community to focus more on content rather than worrying about compatibility) But this may make handset brand redundant?! its iOS or its Android or Mango.. (is this some history lesson for mobile manufacturer-especially Samsung who became number one recently.. remember IBM vs. Microsoft..)

Anyway, in recent fututre there is minimum harm to public in general as long as Mr. G is driuving the show and slowly minimzing role of any other organization. But will it remain democratic once significant manipulative power concentrate in single hand or will it become window dressing of democratic market place.

This compromises from Mr. G, may be next level of disruption. But this give one fantastic opportunity for great ap developer to find some partner who have both brick and mortar model, have distribution and billing, collection network. A partner who has off and on presence both.
There is market for great, serious aps developer who does not want to serve any free lunch, shall also explore this option.

Let us discuss it further some time in detail..

Disruption of VAS business model with 3G environment

I was thinking what are the basic economical drivers of the VAS business.

Let us take the example of full song download (FSD) or some video download. For a while let us broadly freeze on 4 as main types of stakeholders driving it.

Look at it as either individual or the group falling in that category:-

(I)    Content creators- the one who or whose skills singing/ instrument playing/acting / directing or combination get consumed.

(II)   One those who like these creativity means- us, customers let us call it as people

(III)  First buyer of creativity -producer who bets on economics of human talent, charts business plan, engage all resources in anticipation of future gain

(IV)  Last but not least, there is a talent, there is group appreciating talent and there is producer ready to finance the talent for the sake of business. What's missing-a group which is entire distribution chain

 Now look from people perspective: People pays for content creator’s royalty or say pure cost of talent, then Producer’s margin or its ROI for the risk taken (and let me tell you it is very risky business and hence higher the margins), and some more towards interest to be paid for finance arranged & the high lifestyle he/she wants to maintain. Then some amount further added towards distribution chain, as they want return for their hard efforts  to conveniently make content available for you, also there may be charges for investment made in real estate- location where you want to consume, experience provided or purely for delivering it to your door steps through various mechanism and some amount also needs to be paid for actual material or manpower utilized.

So equation becomes: You Pay = f (C+P+D). Where C= for content creator, P = Producer group, D= distribution chain. Typically it is, C << P;  P = max (revenue share); D’s ( % margin) > P’s (% margin)

 

So now here comes Mr. Telecom, who says I will give you direct distribution channel and hassle free single point of collection and limited need to address logistic challenges. And Mr. People also started changing their consumption habit. All agree and market to Mr. People that consuming FSD through mobile/computer is a better idea! Then to make it happen you require some IT development and support. Even after that economics works out and VAS prospered so far.  Since Mr. T (telecom) is replacing Mr. D (Distribution chain++) from the equation wants to retain higher %  revenue share. So far so good and nothing is significantly disruptive. Right!? Now equation becomes:

You Pay = f (C+P+T) where T= Mr. Telecom partially replacing other distribution chain and retaining good margin for that hassle free convenience brought, supporting infra built, spectrum fee paid. ;-)

 Now there comes the disruptive event, extreme disruption through Internet world. Let us call it with beautiful adjective-democratization of business model- and it is represented by Mr. Google Facebook Linkedin also known as Mr. Twits (or for ease we will call it Mr. G). Now give hard look to the situation. Its drastically changed, so does our equation.

You Pay = f(C+c+ G) where ‘c ’ indicates possibilities of replacing all big producers with optimal efforts by content creator itself. 

Its bringing supply to demand by cutting all physical layers and trying to migrate all possible layers to virtual. So supporting content creator right from advertising till monetizing through very large economy of scale build by Mr. G.  Now content owner can almost reach directly with minimal efforts to the appreciator of their content. And not to say, it will have global scope.

That is where Mr. G plays very disruptive, making all business environment hostile. Ensuring all those who happens to be at wrong side of the vision driven by Mr. G, needs to go back to their board room and chalk out new environmental scan, apply porter’s 5 force model and rework SWOT analysis for their organization.

There are some more interesting insights and perspective about all this democratization of business model, will continue this some other time. Have a great time.

Awaits your feedback, most precious thing for me…

The Core: Customer Lost, Revenue Churn, U&R, Employee First

We are hearing too many things and too many experiments to ensure viable profitable telecommunication business in one of the most competitive environment here in India. Few even compare current regulatory fiasco with 2G scam can led this industry to the fate similar to Indian aviation industry... I have no opinion on this and if at all I have one, its biased :-)

Services are key differentiators, lower tariff, Csat, VAS, Data services, Analytics, Micro-segmentations, 3G-4G evolution etc... I agree to all of the above as enablers for profitable growth provided they ensure all their solutions, product and efforts are focused or revolving around or strengthening some of the essential basics.

what we want is 4 simple thing certainly for my customer to stay profitably on my network for longer & longer time  in such uncertain environment:
1) Comfort
2) Convenience
3) Expect, Pay more, Demand more; And
4) Become Referral for my business growth

1) Comfort : Feel at comfortable to my services and interacting with me
2) Convenience : Feel at home, ease, or say Ok kind of thing to use without much fuss
3) Expect, Pay & demand more : For that get used to, raise the bar of its expectation, feel like paying more and demanding more ever
4) Become referral : Be my brand ambassador, personify my services and proliferate among its peer group
 ----
I am sure you will agree to this core,  if not let us discuss.