Mobile Carriers Are Lost

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mobile-carriersThis week all the movers and shakers of the mobile phone industry are gathering in Barcelona for another edition of Mobile World Congress (MWC) or as I like to call it – Boondoggle de España. MWC is a gathering of wireless carriers, device manufacturers,  mobile infrastructure players, content providers and others that are interested in the mobile space.

I’m sure one thing that will be on everyone’s mind is the USD $19 billion acquisition of WhatsApp. That single acquisition has clearly shown that mobile is the future and there is big money in it. The mobile carriers must be hitting their heads against the wall because the money they are losing to these messaging platforms is a sizeable portion of their revenue. Currently, the mobile carriers are just dumb pipe providers and enabling companies like WhatsApp to make all the money.

You hear terms like social, local and mobile thrown around all the time and the mobile carriers have the keys to the kingdom since they have access to all the components:

Social – they know how often and for how long you call people (call records are much more richer then just a phone book entry)
Local – they know where you are via GPS data and cell phone tower triangulation
Mobile – they are the Mobile in Mobile, need I say more?

Yet, the mobile carriers can’t monetize their way out of the low ARPUs (average revenue per user) they are currently getting. For the past 10 years the carriers have been living off exorbitant roaming rates, SMS and VAS (value added services). VAS was not really value added anything, it was garage services offered by the carriers. SMS is officially dead on arrival and roaming rates are coming down everywhere. It appears the carriers are locked in a battle with themselves to offer higher speeds and monetize via the download caps that are in place.

It’s a shame since the mobile carriers have the 3 pieces to the puzzle that every app developer wants. Many might say there are privacy concerns with the data that the carriers have and thus they cannot monetize it. I say BS, if the carriers came out with a free phone that was entirely paid by advertisers that phone would sell out overnight in India even if it had a long list of terms and conditions attached to it – free is free. Imagine a phone that could serve up local offers based on your geographic location or based on the number of times you called Dominos Pizza. The ideas are endless and the revenue potential to the carriers could be much more then what they now generate from end consumers. But, with all the technology the mobile carriers have they are clueless and lost when it comes to monetizing in the mobile era.

Political Dynasties and Corporate Families

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indian-partiesI never expected this blog post to be written because I figured I would never care enough to write about Indian politics. After having spent the last 8 years surveying the Indian political landscape, I felt it was time to pen some of my thoughts.

An Indian Election Primer
Elections are held every 5 years to decide who gets elected into Parliament. The Parliament consists of the Lok Sabha and Rajya Sahba, the election process will start very soon for the Lok Sabha. When a political party has a majority of the seats in the Parliament then that party selects who becomes the Prime Minister of the country.

There are two main political parties – Bharatiya Janata Party (BJP) and Indian National Congress (usually referred to as the Congress party).  In addition, there are many smaller regional parties. This year out of nowhere an independent party called Aam Aadmi Party (AAP) was formed and has been gaining a lot of traction.

Historically, a single party has never had a majority in the Lok Sabha so they end up forming a coalition with smaller regional parties. The two main coalition governments are National Democratic Alliance (NDA) led by the BJP and the United Progressive Alliance (UPA).

Okay, now that the basics are out of the way.

If you have any interest in Indian politics then you have probably watched the train wreck that is the Rahul Gandhi interview on TV. The interview was Rahul’s first in-depth public interview and it showed he has some very big shoes to fill.

Rahul Gandhi is part of the Gandhi family dynasty. His grandmother, Indira Gandhi, was Prime Minister of India and his father Rajiv Gandhi was Prime Minister as well. In addition, his mother Sonia Gandhi is arguably the most influential female in Indian politics. Sonia is an Italian by birth and thus can’t be the Prime Minister since she is not a citizen of India, it’s rumored she controls the current Prime Minister – Manmohan Singh.

It’s clear Rahul is completely out of his league to run a tea-stall let alone the largest democracy on planet Earth. I compare his situation to someone in a large corporate family such as the Ford’s, Mittal’s or Ambani’s. I don’t think LN Mittal or Mukesh Ambani would ever promote their children to the top job if the kid didn’t have the track record to prove they could grow the company and increase shareholder wealth. In a corporate family such as the Ford’s an individual might make a mistake and wreck a couple quarters for the company. No business person is going to risk an empire that was built over generations just because they want to keep family name going in the running of the business. The smart ones will hire outside professionals to run the organization and tell their kids to go and spend their inheritance.

Yet in politics, you see children coming into the business of politics all the time to try their hand at it. Politics may not have “shareholder wealth” but they do have a vote bank which is somewhat similar in value. In India, “trying your hand” at politics means whatever you do affects 1.3 billion people and not quarterly profits such as in a corporate environment.

If Rahul had a LinkedIn profile, it would show his brief political work history and 1 recommendation from his mom, which is sometimes all you need in Indian politics.