MNOs strike back – Can JOYN save them?

Telecom companies across the world are really in a double-bind. From Verizon to Telefonica to Airtel, are all feeling the heat from services like Facebook, Youtube, IMs etc. Commonly referred as Over-The-Top (OTT) providers, services like Instant Messaging, Video Streaming (Netfilix), VO-IP calls (Google Voice,Skype) have slowly started to eat both revenue and bandwidth from the Telecom companies.

Take for example, the messaging services. Though SMS is still having healthy marketshare, the instant messaging services like Skype and facebook have resulted in 15.6 billion lost revenue for telcos worldwide. Though its small compared to $153 Billion total revenue from SMS its still a figure which can’t be ignored.

Add to this services like NetFlix and Youtube which happily consume bandwidth and use the resources and infrastructure that Mobile Network Operators(MNOs) have built investing billions of dollars. Though the online streaming companies earn billions they dont payback anything for the bandwidth owners.

Apart from messaging and streaming services, the OTTs have started garnering marketshare in voice services, which is core business of the MNOs. Services like Skype, Viber, Vonage, Talkatone, Google Voice offer cheap voice services for customers using VO-IP. This should really alarm the Telecom Companies.

MNOs were never oblivious to this threat. They have tried individually to create similar services on their won. Verzon’s partnership with Redbox for streaming, Telenor’s ComoYo service for Nordic countries, Operators have infact bundled apps and services in the devices they sell. But they were mostly considered bloatware and never gained traction as independent OTTs.

Now in a co-ordinated effort the GSMA has announced specifications for instant messaging and video-calling called as ‘Rich Communication Services’. The operators have come up with a brand for the same known as “JOYN”. European and Asian operators are expected to launch the Joyn services later this year. Interoperability between different Telcos might be a great plus point which was lacking in services earlier.

Joyn/RCS might not eliminate the established OTTs instantly. But they will make the MNOs stay relevant.

Why aren’t More Indians Using Twitter? – Pandodaily is wrong

I frequent the recently launched Pandodaily.com for its excellent coverage on Startups and Technology trends. Their recent coverage on Google’s Search-Your-world fiasco was splendid. Especially Sarah Lucy’s (former Techcrunch Blogger) articles are a treat to read. But her recent post on Indians’ twitter usage is factually wrong. You can read the orignal article by clicking here (at Pandodaily.com).

The article lists the below reasons for Indians not using Twitter much.

1.India’s Poverty inspite of its size

2.Very less(??!!) English speaking people.

3. Pseudo Democracy

4. Rapidly growing but still small middle class.

All of the above might contribute to the less usage of Twitter in India to some extent, but they are not the main reasons, The main reason for Indian’s not using Twitter much is – Text Messaging (SMS).

Yes, Text messaging heavily in India. Apart from being very effective and convenient, the cost of Text message in India is very less or absolutely zero.This is unlike US, where text messaging is costly than in India This also needs to be seen in the context of feature phones still being more prevalent than smartphones (though that situation is changing).

Yahoo/Google/Facebook messengers are used personal and group chats. Add to this the now popular Blackberry Messenger Service. For all other social needs Facebook is used. (Earlier it was Orkut) The recent Facebook stats proves that. More details on the statistics is available here.

With Texting and Messengers taking care of short conversations and Facebook covering Social Networking, where does Twitter fit in? Many have signed up for Twitter and nobody uses it. Twitter is not alone here. The same arguments apply for Google Plus.

And again, this doesn’t mean, Twitter is not used at all. Twitter is making fast inroads and a list of popular tweeters can be found here. Once SmartPhones are more prevalent twitter usage will shoot up.

So, the real reasons for Twitter Usage less in India is the above and not what has been mentioned in Pandodaily’s post.

FDI in Indian Retail : The Major Roadblock

Late last november India announced its policy to allow upto 51% FDI in Multi Brand Retail (MBRT) and Upto 100% FDI in Single Brand Retail (SBRT). After facing stiff opposition from various political parties and other sections,the Indian Government has decided to put on hold the FDI in MBRT segment.

It still has gone ahead with the decision on allwing 100% FDI in Single Brand Retailing. Though this is not sufficient for FDI in Indian Retail as a whole it still is better than the status-quo. This should attract lot of Multi National Brands to open shops in India and can give a boost to FDI flows in India. But the situation is not that rosy it seems.

The reasons for Indian Government’s decision to open up Indian Retail are many. The major reasons are

• To contain inflation by allowing inflow of FDI and spur GDP growth which is expected to fall back.
• To stop the free fall of Rupee value.
• To bring in foreign retailers in a hope to improve the country’s poor supply chain infrastructure.

While companies like Apple are mulling to open shops in India, it is not going to happen in the near future. Even though the Government has announced its decision on SBRT FDI, it might take months before its implemented taking into account various state elections in India. Even its implemented, bureaucratic roadblocks will further delay the process.

Above all the major obstacle for Retail companies planning to enter India would be the condition that 30% of the goods sold should be procured from local “small industries”. This might make some companies think twice or delay or even shelve their entry like in IKEA’s case. With foreign companies already having brands based on goods procured from established partners and enterprises the 30% condition might be difficult to implement.

This still doesn’t mean the companies are going to walk away from lucrative Indian market which has a burgeoning middle class with disposable income. They are going to pressurize the Indian government to ease the conditions that will be beneficial for them. Either way its going to take months before we see foreign brand shops in India.

MySpace is Back. Or is it?

The drop in user traffic of Google plus reminds of yet another ill-fated Social Network – Myspace. Many of you wouldn’t even remember such a site exists and it was once the largest social network in the world much like Facebook is now. My first account in a social network was not orkut nor facebook, it was Myspace. Though my network in Myspace never took off, its worth take a look at what is the status of the site now.

Myspace which was started in 2003, was bought by NewsCorp for $580 million in 2005. Between 2005 and 2008 it saw its peak and fall. It reached the fame of America’s most visited site surpassing Google in that period. It was the default online place for people to meet their friends, socialize, consume media, blog etc. Music Artistes started their own pages in Myspace for fans and to share content. And then it started to decline and Facebook took over the crown from Myspace and surpassed it as the largest Social Network. Eventually Myspace was forced into oblivion.

So what happened? Instead of adding features for users to socialize, Myspace morphed itself into more of Music and Media site. The pages were covered with Ads than content, and thanks to Ad agreement it made with Google. More spams, clumsy user interface versus Facebook’s simplicity, no open APIs, lack of developers interest all contributed to the social Networks fall. Eventually News Corp too wanted to get rid of this business. Specific Media along with Justin Timberlake bought Myspace late this summer for $35 million, way less than what News Corp spent for it.

What can Specific Media do that News Corp couldn’t do with Myspace? History shows that Internet Titans once faced with decline had never made a comeback. Netscape, AOL, Yahoo are all examples. Specific Media CEO Tim VanderHook doesn’t think so. In his Interview with Bloomberg he expresses confidence to turn around Myspace. The video is available below.

Though the revamped Myspace is planned to be released later this year, it is clear it plans to build upon its Music and Media assets. It is betting on Justin Timberlake’s brand image to do that. But the Online Music business is getting crowded with Spotify (in partnership with Facebook), Google, Amazon, Apple and atleast another hundred companies trying to provide the user with cloud based music streaming experience.

Can Myspace become the Music Catalog of Internet? That depends on its success to become a platform for Music in partnership with labels,artists and companies like Google/Facebook/Apple instead of a identifying itself as a Social Network or a normal Music site.

Update: Myspace today (02/13) reported that it has added a million new users in December. That is huge considering how fast they were losing users earlier. They attribute the success to the launch of their new music player. Just as we had mentioned in the above post Myspace should continue as Music platform rather than Social site.

Apple Disrupts Personal Computing Dynamics

With HP announcing that it will be exiting PC/Laptop business today, the end of PC seems more inevitable than ever. This needs to be seen in the context that HP is the largest maker of PCs.  The earlier big weight was IBM when it sold its PC business to Lenovo. Dell too seems to be struggling in this low profit commoditized business. The future of computing seems belong to Smartphones and Tablets.

In mobile space the struggling Motorola Mobility (manufacturer of Droid Line of Phones) was agreed to be bought by Google for a whopping 12.6 Billion Dollars this week. Switching to Android earlier, didn’t help Motorola to yield the expected turnaround. The pioneer in smartphones, Palm (part of HP) is officially announced obsolete today.

Though these news indicate the changing dynamics of the Computing Technology space, the most important revelation is the amazing rise of Apple to prominence. With PC and Mobile OEMs struggling to maintain their bottomline with declining topline, Apple’s growth in both the these areas is astounding.

Within a decade, Apple has conquered the PC and Mobile space and has risen to be the pioneer of innovation and high quality consumer goods.Here is the list of Apple’s products that have been the leaders in their respective markets.

• IPod Mp3 players (Smashed Sony’s Walkman series and commends >80% market share)
• IPhone (Revolutionized the Touchscreen Smartphone with IOS and AppStore Concepts.)
• Mac computers (Highest Growth Rate and most profitable, when PC sales are faltering)
• IPad Tablets (Created a new touchscreen Tablet market and commending >90% market share. Consumers starting to refer all tablets as Ipads)

Not only the above, Apple gives competitors a run for their money. For instance, Sony was dethroned as consumer electronics giant, Dell & HP struggling in PC business, Google struggling to keep Android’s momentum by overspending for patents. Google is no more known for innovation,Apple is. Nokia no more leader in Phones, Apple is.

The question is how did Apple achieve this phenomenal success? Here are the 2 main reasons

• Create products that are innovative, usable and above all that works. Apple plays down specs and features and concentrates on usability and aesthetics. While competitors boasted high end specs Apple has historically concentrated on features that users want most. While an Android phone/tablet always feature high specifications, Apple phones are designed to be sleek,hip and usable.
• Avoid tempting price points and concentrate on value. Apple has always avoided indulging in price wars that is race to the bottom. While competitors are struggling with wafer thin margins, Apple is reaping profits in the same businesses by offering more value to customers for the money that they spend on its products.

Though Apple’s policy of maintaining tight control over its platform might hurt it in the long run, until it delivers the same high quality and innovative products it will remain the leader of Personal Computing Space both in Software and Hardware.

Facebook Deals And Other Top Local Deals Sites

Who doesn’t want great deals? By launching its deals service, Facebook is new entrant in the fast growing Local Deals business. So what are the popular Social sites that you can use to get the best deal on the product or service you have been longing for?

1. Facebook Deals : Its the most straightforward of all and can be accessed directly from Facebook. But currently available only in 5 cities in US namely,Atlanta, Austin, Dallas, San Diego and San Francisco. Start from here : http://www.facebook.com/deals
2. Groupon: By far the most popular Local Deals site and has international presence. You can subscribe to lucrative deals via email or facebook or twitter and then print the voucher or use the mobile device to present the voucher to the business.Groupon recently turned down Google’s takeover offer. http://www.groupon.com
3. Bing Deals: Shortly after Google’s failed attempt to takeover Groupon, Microsoft surprised everyone, by launching Bing Deals. But unfortunately it is currently available in iPhone and Android. Ironically not available in Windows Phone 7
4. Living Social : Similar to Groupon, this is another popular site where you can subscribe for daily local deals which are usually worthy ones. Registration is simple as Groupon. You can access it at http://www.livingsocial.com

5 Reasons Why Google Delayed HoneyComb Source Code Release

Google’s recent announcement to delay release of Android 3.0 Honeycomb source code to developers, has raised the question whether Android is truly open. Critics argue that software can be either Open or Closed and should never be selectively open. In an e-mail statement to WSJ, Google claims that

“while we’re excited to offer these new features to Android tablets, we have more work to do before we can deliver them to other device types including phones. Until then, we’ve decided not to release Honeycomb to open source. We’re committed to providing Android as an open platform across many device types and will public the source as soon as it’s ready.”

Now that sounds reasonable, but are these the real reasons behind delays release of source code? Here are the 5 reasons we believe why Google had to take this decision

1. Google Circles: Rumor suggests that Google has completed developing the Social Network service touted as Facebook killer “Google Circles” and might be releasing it anytime now. It is expected that the service will be built into the OS itself rather than available as an app. Google doesn’t want to release the code now which will have the components of Google Circles. It want to keep it under wraps and announce it in the coming weeks or months.
2. Google Music Service: The same reasoning goes with Google Music service also, which is rumored to debut in the coming days. The OS might have some components related with this service and Google doesn’t want general public and competitors know about this service much before it debuts.
3. IP Law suits: With a bunch of lawsuits already against Android, Google doesn’t want to reveal the source code now and invite a host of more IP violation law suits. It wants Honeycomb capture enough market share before getting into IP related troubles.
4. UI experience: With critics slamming the recently released Xoom running Honeycomb for bad UI experience and buggy software, Google wants to tweak and refine the OS before releasing the code to general availability. It wants to avoid the glitches that users faced with Xoom, in its upcoming rumored Nexus Tablet.
5. Finally as Google has suggested, it wants to avoid further fragmentation of Android with third party hardware manufacturers and developers using Honeycomb on Phone. Currently Android 2.x OS targets smartphones and 3.x targets tablets. Google wants to optimize 3.x so that it can be used in smartphones. If that’s the case, Google will discontinue 2.x OS for good.

Taking into account above reasons it’s clear that Google is slowly becoming a proprietary software company. Following in-house development of OS and then delaying the source code release even though products are released with the binaries are clear indication that Android is open no more.

Can Yahoo! do it?

Yahoo is struggling to keep up with the current Web trend. Carol may sound more optimistic in the above video, but the latest news suggests that Yahoo is planning to cut 5% of workforce. Nevertheless, she does has a point about the Microsoft-Yahoo search deal. The ten year deal allows Bing to power Yahoo search and allows Yahoo to keep 88% of the search ad revenue. Microsoft gets remaining revenue and gains access to the user info and preferences thereby helping in more targeted ads. This might add additional $500 million revenue for Yahoo.
But this still is not enough to stop the other businesses from faltering. Before the Y2K boom Yahoo was the trendy web and search company attracting most of web traffic. Its failure to innovate in search and missing the Social Networking wave has cost it dearly. I am afraid Yahoo shouldn’t become the next Sun Microsystems or Novell.

Oracle and Open Source

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Oracle’s War on Open Source
Oracle has been in the news for the past few weeks not only because of its  stunning quarterly results but also its dealing with the opensource products it  bought along with Sun. Oracle claims it is world’s largest OpenSource Company and does offer numerous Opensource products. Though Redhat rebuts the claim, based on number of products and sales, the claim is atleast in theory true. But again Redhat is right when it says, Open is not just seeing the code, but having a community of developers and not keep some part open and some part closed. Redhat goes further to say that Oracle doesn’t even qualify as an Open Source Company. Oracle’s recent moves some how is substantiating Redhat’s claim.
Opensolaris
initially MySQL was feared to be the FOSS product that  will receive Oracle’s axe or indifference. Though MySQL seems to be safe atleast for now, Opensolaris is not. It is official and has ended months of speculation   and uncertainty. Opensolaris is dead. Oracle has made it clear that Solaris  will be its mainstay product to get the latest feature updates. The Solaris source code  will be released to “partners” after the product release itself and the brand  Opensolaris will cease to exist.
Java and Google
Then Oracle sued Google claiming its Dalvik VM implementation in Android infringes several of Oracle’s Java copyrights and IPR. In oracle’s words, Google "knowingly,  directly and repeatedly infringed Oracle’s Java-related intellectual  property." Now in this case it seems Oracle has chance of winning the suit or Google will take the route of out-of-court settlement. Either way Oracle is going to squeeze good amount of money from Google. This case has indeed rattled many other IT biggies who have invested in Java as their  choice of platform for their products. They are slowly falling in line with Oracle. Take the case of IBM, which Oracle says its enemy number one, shifted gears and decided to collaborate with Oracle on the OpenJDK project thereby abandoning the Apache Harmony project. Looks Redhat and Canonical are on their own to back Harmony now, may be they too will choose to fall in line with Oracle eventually.
OpenOffice.org
The other product that has been making news is OpenOffice.org or OOo, as the  Document Foundation has forked it into LibreOffice. Though Oracle has not done  anything from its side to result in this fork, the Foundation has decided that  this route is safe seeing the indifference from Oracle. I see the Document Foundation’s point here but can LibreOffice survive on its own given the reach of OOo’s brand name reach? Only time will tell.
Linux and Redhat
Finally Oracle stunned the world with its announcement in OpenWorld 2010. Going to extreme, Oracle has announced that it is forking the Linux kernel itself and has come up  with Unbreakable Linux kernel optimized for Oracle Database. This is perfectly  valid in Opensource world but it kind of hints what Oracle’s intentions. It is clearly taking shots at Redhat. Its earlier attempt to undermine Redhat Linux with its offering of Oracle Unbreakable Linux never worked. Now Oracle will arm twist its customers saying the new Oracle kernel is better than one in Redhat’s.
The above developments has sent shock waves across FOSS communities,  although not surprising, bringing in the question of what will happen to MySQL  eventually. It is very clear that Oracle wants to invest time and money only in  projects and products that will add value to both to its topline and bottomline. It wants to squeeze money out of all OpenSource products it owns, by all means. Though that’s understandable as a corporate responsible for provding value to its Shareholders, it should also should embrace the communities behind the projects rather than act as big brother dictating terms. But the question still remains, is this what always happen when a proprietary software company buys an  opensource company or product..? Especially when companies like Novell will be eventually up for sale and the industry heads towards consolidation. Not always true, but in most cases  unfortunately the answer is yes.

Private Equity Firm bids for Novell

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Novell has announced that it is considering a bid by Private Equity Firm Elliot Associates to acquire it. At a price of $5.75 /share it will be an acquisition worth $1.8 billion. The price is almost 21.1% premium of what Novell’s share was selling earlier. The news has sent Novell’s share sky high in latest trading.
If this deal goes through Novell will become a private company.
Novell has been struggling to prop its legacy Netware based business with Suse Linux portfolio. Though it has not been completely successful in doing so, as evident from its falling sales quarter-on-quarter, the Linux division has shown some impressive growth. It has break even in the last quarter. But still Novell ranks a distant second in the Enterprise Linux market behind Redhat which sure is leader in that area.
Though the overall revenue of Novell might not be attractive, it still has a cash flow of around $981 million in its hands which might have attracted Elliot Associates. Can the equity firm turnaround the struggling company after takeover without burning the cash? The possibilities look  grim. But if Elliot is able to spun off Novell’s struggling divisions out and concentrate on it Suse Linux based offerings then it will still might squeeze out profits from Novell.
Elliot might not be alone in its bid soon. Most analysts expect Dell or Cisco or VMWare or even Microsoft (though highly unlikely) to offer competing bid to takeover Novell soon. That might make sense for those companies as they have enough cash and a Enterprise Linux product in their offering will sure add up to their top line.
For me the only concern is the takeover might have significant impact on the community based development of Suse Linux. If Novell is to go down, that will make Redhat a monopoly in Enterprise Linux arena which is not good for innovation. Also the efforts for interoperability between Windows and Linux done by Microsoft and Novell might also be jeopardy. That might affect the customers as well.