3G and WiMax will bring tens of millions of new devices to the Internet marketplace, are you ready?

The prospect of Indian operators launching 3G and WiMax services has 36-year-old Yusuf Motiwala excited. A veteran of premier technology companies like Lucent Technologies and Texas Instruments, Motiwala bid adieu to his high-flying corporate career to start his own mobile application firm a year and half ago.

The strengths and limitations of the mobile device itself will mould the kind of services that will be successful on it. Vishwanath Alluri CEO and Chairman, IMImobile

“Carriers have made it into a walled garden, but things are going to change now,” he says.

Motiwala is talking about the Rs 7,000 crore Indian mobile value-added services (MVAS) market. Motiwala, whose TringMe platform tries to use Internet data to provide seamless voice connectivity, gets most of his business from outside India now. Though TringMe offers a mobile phone application that uses the subscriber’s data connection to enable free voice calls to other phones and computers, the take-up in India has been limited so far.

“Only a small part of our four million users are from India currently. The data connectivity here is very poor,” he says, “In addition, there are many regulatory hurdles. We cannot interconnect our traffic with normal phones in India; we can’t give them a phone number. So, we have to give our users a US phone number.”

The problem that services such as TringMe face in India is at a fundamental level, that of the availability of basic infrastructure. Most applications such as voice-over-Internet, streaming music and video, video calling and a decent web-surfing experience require moderate to high speed access to the Internet.

Because the mobile Internet experience is less than compelling at the current speeds, only about 5% of the 300 million Indian mobile users have subscribed to any kind of data plan, even though more than half of the handsets sold in India in the last two years have data capability. Even though there are no high-speed wireless data services yet, most phones that cost upwards of Rs 8,000 come with 3G built-in. The prices too are declining every quarter.

“As of now,” says Pankaj Mahindroo, president of the Indian Cellular Association which tracks mobile phone sales, “about 15% of the phones sold in India are 3G-enabled. But, technically, 3G handsets can be sold for as less as $100 also, given the decline in prices.”

However, the fact that most mobile users in India do not subscribe to any data plan means that mobile VAS providers have to come up with ingenious solutions to reach out to their customers. “We have tried to get around by introducing an SMS-based alternative, in which we will patch you with voice call if you send us an SMS with the phone number you wish to speak to,” says Motiwala.

However, most companies choose the easy way out and either provide only voice and SMS based service, or tie-up with the operators to deliver data services even to those subscribers who do not have data plans. Caller ring back tunes and SMS news alerts are an example of the earlier strategy, while music and video downloads are usually delivered in partnership with the operator. The result has been that mobile VAS businesses in which the operator does not charge commission and the vendor reaches across to the consumer directly are almost unheard of in India.

It is in this scenario that 3G and WiMax are likely to play a very disruptive role by making millions of consumers directly accessible to the mobile VAS service providers. The faster connectivity is likely to lure high-end consumers to subscribe to data plans that allow them to connect directly to the Internet. Once exposed to the Internet, VAS providers can directly reach the customers without having to depend on operators to deliver content such as video, music and messages.

NOT JUST INTERNET ON PHONE
While exciting, unleashing the full power of high-speed Internet on the phone may not lead to the most obvious results, according to some.

A new entrant will have to leverage the uniqueness of the mobile phone. Chaitanya Nallan CEO, mGinger

“Most of the VAS services right now are built around voice, because voice works on low bandwidth networks also. That is all you can expect from the current 2G networks too,” says Prasanna Gokhale, manager for wireless and telecom at Tata Elxsi, the Bangalore-based technology arm of the Tata group.

“However, 3G and WiMax networks have fat pipes in which voice will be one kind of service. These services will allow you to design and launch applications that could not be even thought of earlier. It’s certainly not going to be just Web pages on your phone, but video-on-demand, news modules, voice-over-Internet,” he adds.

Indeed most developers see an opening for new players—new Googles and Yahoos—on the fourth screen.

“A new entrant will have to leverage the uniqueness of the mobile phone. They have to realize that it is not like the PC. It’s always with you, and it’s more personal,” says Chaitanya Nallan, who founded mGinger, a targeted ad service for mobile phones, with two of his friends a year ago. “The services offered can be more personal and more location-based than on a PC,” he points out.

Vishwanath Alluri, founder and chairman of Hyderabad-based managed service provider for Telco’s IMImobile, strongly believes that the market opened up by mobile Internet will have very different dynamics. “The needs and circumstances of someone using a mobile and a desktop or laptop would be very different. A desktop user is probably sitting in office or home while a mobile user is more likely to be out. Therefore, what people do with Internet on a PC may not be what they do with Internet on a mobile,” he says.

Comments (1)

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simply ..good
written by video online, July 07, 2010

Well i just felt that many people themselves just jumbled in the high profile terminology related to it and ITES ,but simply there is always a way out of every possible opportunity identified in today's context.now people are started to learn about the advantages of the 3g and WII phones thanks to the low cost wap enabled phones and affordable wap suuch like mentioned in like video online marketing on ipohones etc.

thanks to this article,there is huge big open market waiting to get tapped so why not start right now,before some body eats's our market share.

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