Our CEO Mahesh Murthy, was at the World Mobile Congress in Barcelona. He shares his views on the future of mobile applications in his WSJ Column.
An abbreviated version of this piece first appeared in Business Standard.
It’s hard not to run into some wide-eyed fanatic telling us how mobile will change our lives. And I am in Barcelona as I write this – the Mobile World Congress, also called 3GSM, is on – and the city is positively bursting with mobile fanatics from around the planet.
A colleague from the Internet business in India meets me before we board the plane and says that his employer, one of India’s leading print media groups, is now investing in mobile startups. Another presenter at the conference I’m speaking at here has just gone on about how social networking is being used much more on mobiles than the desktop.
The buzz at Barcelona is about Microsoft’s cool new operating system for phones. And also that, after failing to buy MTN, Bharti’s trying to buy Zain.
But let’s slow down here. There is news of this sort virtually every year – and I believe that it’s easy to miss the woods if one focuses on the tree-like nature of these one-off announcements.
Yes, I do know the numbers. 500 million mobile subscribers in India – though I understand it’s more like 400 million, the rest being either accounting jugglery or the same person being counted twice. And 5 billion subscribers around the world this year. These are big numbers.
But where are these users headed?
Should you run out now and start a mobile applications company? I’d caution you a bit.
At the risk of sounding self-obsessed, here’s something that happened last night.
I had tweeted about my talk, and I’ve set things up so that I update all streams – Twitter, Facebook, LinkedIn, Google Buzz and more at the same time. It’s too much trouble to do them separately.
An ex-colleague in New York saw the update on Facebook and left a message there, suggesting a restaurant I should go to for tapas after my talk. I looked it up on TripAdvisor, saw that it had an average rating, and looked for other places with a better reputation.
It turned out one of those was just a mile away from me, according to Google Maps – so I took a cab there and got off, in cold weather and freezing rain. To discover the place was under renovation.
So I went back online to find a tapas restaurant which was within walking distance and found one that claimed to be 0.07 miles away – which was about how far I was willing to brave in the weather.
Thankfully, it was where the map claimed it to be – but they had a menu just in Spanish. So I went back to Google again to figure out that a Bombas wasn’t a terrorist but actually something quite edible.
Notice anything interesting about that? It took me a while to figure it out.
That I hadn’t really used any mobile-only applications through the entire process. I had used both devices – my laptop and my phone, but I’d used a set of applications that worked across both platforms, and that were agnostic to what I was using. Except for the fact that when on the mobile, they were a little more location-aware than my laptop applications are – and of course, they were visually formatted differently.
The ‘platforms’ word struck an “a-ha!” light in me. Mobile was just another platform. Much like CDs came after audio tape, or DVD after VHS.
You didn’t need a new set of musicians or film-makers for the world of CDs and DVDs – they simply moved their work to the new platform. We continue to listen to the bands we love and the directors we like as they moved to new platforms.
But as users, we don’t really care about what device we are on.
In pretty much the same way, I think the mobile revolution is probably more important for hardware companies – because they can make and sell devices in new form factors. And maybe the operating systems guys – as they work on different chips and power consumption patterns, and application developers have to port their work to different platforms. But there’s no money in this business as the players are giving it away free.
But if you’re one of the millions of startups looking to create the next mobile Facebook, or the next mobile Twitter or the next mobile Google, guess what. They’re already there. Facebook is the mobile Facebook. Twitter is the mobile Twitter and Google is the mobile Google.
This reminds me of the time many years ago when I railed against the companies trying to build the Indian Yahoo, the Indian eBay and the Indian Facebook. My logic then was those brands themselves would define the Indian experience, and it turned out not too different.
A Rediff today is a tiny fraction of the size Yahoo is in India, Ebay swallowed Baazee for virtually nothing and the whole lot of Ibibo, Minglebox, Fropper and BigAdda put together can’t hold a candle to what Facebook has done in India with no promotion.
Yes, there may be room for really narrow, specific software that is only relevant on the mobile platform. I use apps like Where and Wikitude to show me stuff that is around me, based on where my mobile phone is at that point in time. But that’s a limited set.
What do I see happening as a result in India?
One, I think all these mobile walled-garden portals in India from operators like Reliance and Airtel will go the way of AOL: wither away to nothingness. The consumer isn’t going to want to be locked to your little limited version of the Internet when the real one is just a click away. So, to all the companies putting together white-label apps and ringtones for the carriers and unhappy that the carriers aren’t giving you enough money for it, here’s more bad news: Your carrier will have even less money to give you in the future. Your road to long-term salvation lies in building a consumer brand and pull – because operators won’t have the ability to push things down the throats of the 500 million for much longer.
Now to the second big driver – data on the mobile. I do think it’ll be a big deal – and data-ready phones are getting cheaper and better – and there’s enough competition among operators to drop prices on data plans here. As an aside, I wish someone could give us cheaper data roaming overseas – I think I single-handedly pay for the fuel bills of Sunil Mittal’s private jet. Data will increasingly be consumed by the younger generation – a sample size of one in my research study involving my 12-year old son shows that his pre-paid bills are 95% data, 5% voice.
The numbers on mobile data are growing. When Pinstorm buys digital ads on the mobile in India, outside the walled garden, we already see about 7 million users we can reach through just one vendor alone. Interestingly, an IMRB survey claims there are only 2 million people such folks there – this is one instance where, unlike the TRAI, the official data on telecom usage is way behind the actual commerce.
Third, again, somewhat contrary to what many pundits have said, I believe that usage of applications on data will start on familiar grounds for many of us- that is, the desktop, and from there move out to the mobile. Especially for social apps, where the newbies will go where their wired friends already are – and that means a pre-existing presence on the desktop.
I don’t think there’s room for too many mobile-only applications, like there isn’t a market for too many Blue Ray-only movies. I’ll also put my neck out – and insist I’m not being elitist when I say that I don’t think there are too many applications that will start at the bottom of the pyramid where the folks with Rs. 80 ARPUs will start using it and then migrate upward to the Rs. 800 ARPUs.
Want this market? I will duck from the Prahalads and bottom-of-the-pyramid pundits and say to you: Start from the more affluent desktop user, and then go down.
I’ll wrap up now, and go see if I can advance check in online for my flight back. Not sure if I’ll use the phone or the laptop for it though!
