Interview with Prashant Kumar Singh, Co-founder and CCO, LeadSquared

Tech Interview

hatankar

-

February 21, 2018

Interview with Prashant Kumar Singh, Co-founder and CCO, LeadSquared

Prashant Kumar Singh is Co-founder and Chief Customer Office of LeadSquared which was started in July 2011.

LeadSquared is a marketing automation and sales execution platform that helps businesses increase their closures, manage their pipelines, and attribute their ROI accurately and completely – to people, marketing activities, lead sources, products, and locations.

In a conversation with Mobisium, he talked about his journey and shared some interesting tips for Young Entrepreneurs.

Q. Does being an IITian has helped you in your Start-up journey in any way?

A. Oh yeah, I would give a lot of credit to the kind of education and environment I got in IIT, though honestly, I was not a very good student. I used to be a very good student before IIT. I did not really spend a lot of time in getting grades in IIT, but I think the kind of environment you get, basically what IIT brings you is that you can do anything in life, it gives you a lot of confidence, you can go for say Ph.D. out of India, you can go for IIS, you can go for CAT, you can do a job, you can start a company I mean you see a lot of people doing these kind of things and you get a lot of confidence by seeing people similar to you doing amazing things. So, certainly, I will give enough credit to IIT.

Q. So, IITians never settle for 9 to 5 job and always think of doing 24 by 7 kind of job like Startup hi karna hai.

A. Startup hi Karna hai kind of culture is there in IIT, not really startup but kuch karna hai, something different. So, one of my wingmates, he actually started a company while he was in the third year and he sold his company while he was in the fourth year. So, when you stay with this kind of people you know that if you want to do something you would be able to do it.

Q. So, what was your plan while you were in IIT?

A. So, honestly my family wanted me to go for Public Services and try to become an IS Officer, so I am from UP, and this is in DNA of people who come from UP but I was very clear that I am not going to go for Civil Services, neither I wanted to go for any kind of MBA Degree. So, I did a basically an integrated Master’s Program of 5 years. I thought 5 years was enough, I don’t want to study anymore. So, I wanted to basically come to industry and learn. And then if required I would go for PhD. or MBA but first get the exposure in the Industry and then decide what to do. And this changes your worldview, I mean when you start working you see the practical applications of the knowledge that you have learned in schools and colleges.

Q. What should someone do if you are not able to find your interest or passion?

A. I think you can be a little bit methodical about that so you may not know what really is your interest but there could say 4 or 5 areas where you are interested. You can prioritize, I mean on the scale of 1 to 10 you can give 9 in Interest A and 8 in B. So, give it a shot, for say A, if it works out then go for it otherwise you can go for B or C. So, sometimes unless you do something you don’t really know. So, it may also happen you are very very interested but when you start doing it you feel like “No, this is not my thing.” So, I think it’s easy to pursue what you are passionate about but before that you should know what your passion is, right? So, sometimes you should experiment and you should not be disheartened if you fail, right? If you know that these are 5-6 areas that you are interested in, try with the top one, go down, you will find something, eventually, you will find something.

Q. What is LeadSquared all about?

A. So, LeadSquared is a Sales Execution Platform that automates the process of running sales for any organization. So, it basically automates the cycle of getting lead generated till it becomes the customer. So, basically a Company or a consumer may come to us with a Company’s website or may download an app and after that they may be interested in product or services offered by the company and they may submit the information. After that there might be based on what they have done on the website or google app, this company may want to some kind of marketing promotion on this lead and once it is qualified that there may be a sale opportunity, the salesperson or the sales system itself may start nurturing from the sales perspective and after sometime it may grow, so that’s the very simplistic way of lead capture to conversion. So, LeadSquared basically automates the entire process, starting from lead capturing to conversion. And we are popular where the Sales is very high velocity which means there are a high number of leads and many sales have to happen. So, for example Industries like Education where there might be 100s and 1000s of leads getting generated per day and you need to say do 100s of enrolments every month or it might be an insurance company where they have to say sell 1000s of insurance policy every month or it might be lending where you have to disburse say 1000s of loans every month. So, wherever there is high volume, high-velocity LeadSquared fits very well. So, that’s what we do. Using the software, the number of leads you can generate can be exponential. So, we are using the term squared, it actually resonates exponential i.e. your sales can be exponential by using LeadSquared.

Many of the transactions that you do for example taking a loan, I mean you don’t take a loan just by going online, if it is a very low-ticket loan then you can probably do but there is an interaction, right? There is a qualification, there is documentation all that happens right? If you are subscribing to an insurance policy there is an interaction, right? If you are booking a high-value travel package there is an interaction, right? If you are subscribing to a course there is an interaction, right? So, wherever there is a sales processing coming in the picture LeadSquared fits in very well. So, we have like 800+ customers across the globe. And many of these customers are in education, insurance. We work with some of the top brands in education like BYJU’s. Aditya Birla Captial uses LeadSquared. Bharti AXA uses LeadSquared. So, we have top companies in the respective fields using LeadSquared.

Q. What skills do you look when you hire a recruiter?

A. The most important skill we look while hiring a recruiter is whether the person is able to understand the job profile that we have. So, we are the technology company. We hire a top-notch people. So, if 1000s people apply to a technical role within the company, probably 5 or 10 would be hired. So, that is the kind of process we have. So, people with the mindset just sourcing the profile that will not work. We look for really understand and have skills beyond these Java, C++, .Net and all which everybody knows. But people who are able to understand the projects that people have done, when they look at the resume and the profile, whether the kind of work the person has done, is it meaningful, substantial, is it rigorous or not? So, we look at the person, whether the person comprehends the kind of job profile we have to offer. So, by the way, recruiters are very smart, they are able to ask technical questions on the phone itself and they are able to shortlist. So, the first round of interview is done by recruiters themselves. We do hire from college also, there we focus more on aptitude, whether the person has energy and those kinds of things.

Q. What is the strength of Team LeadSquared?

A. We are like 135 right now. We are headquartered in Bangalore. So, the majority of people are in Bangalore. But we have sales offices in Mumbai, Delhi, Pune, Hyderabad, and Chennai.

Q. What sets LeadSquared apart from its competitors?

A. I think we are very focused on solving the real customer problem, we are in a kind of in mission mode. We are in the mission of transforming the sales process experience. I think we are creating the category of software. So, 30 years back there used to be IP software which still exists, everything was possible in ERP and people used to sales management and everything in ERP, but then came out CRM. Now there are many companies offering CRM but still, people are unable to do meaningful sales with CRM. So, we are creating a category out of CRM and we are calling it Sales Execution Platform. We think that modern sales have to be done in a different manner, it has to be agile and companies should not spend many months in implementing the software for doing sales, right? It should be days or weeks. If a company decides to offer a new product, it should take months from IT Department to come up with the system that can enable the process for that new product. With LeadSquared it can happen in a matter of days or weeks. So, we want to transform the way the sales functions. We have basically thought of automating anything which is possible. So, we want salespeople to focus on real problems. I should not be looking on the calendar what I have to do today, my system should be able to tell. So, the way the consumer applications like Google Maps, Uber, Ola, WhatsApp, the kind of ease they have created in the day to day activities, similarly same kind of experience we want to create in software. So, a salesperson should not spend his time in the activity which is less optimal for them. So, that’s our mission and we are very focused on the customers. We are not worried about the competition, we are not worried about the whole glamour, news/media about Start-ups. Even though we are a Startup we don’t say we are a Startup, we say we are a business. I mean it doesn’t mean anything saying that we are a Startup. We are a real business solving real customer problems and we want to keep growing.

Q. Startup is the new trend. What is your opinion on this?

A. Yes, it’s a fact. But we don’t want to follow any kind of trend or fad. As long as we are solving the real problem, the real business, we are humble, we are grounded, we are customer oriented. We are solving the customer’s real problems. You know LeadSquared has a reputation that our customers often say that no company gives the kind of customer service and support like we do.

We are a product company; customer service is just something that we offer our customers but we are so customer oriented that they have to say we are the best. So, my belief is that- Just be true, keep listening to customers, be focused on what you want to do in the long term. I mean our long-term mission is transforming the sales process and just stop worrying about or ignore everything happening around you.

Q. What was the most challenging part throughout the span?

A. See if you look at a journey of a company like ours, it is a journey of 10 to 12 years. Which will take the company to a level where found is may not be required. I mean eventually, you want to build a business which can scale on its own. I mean if I am not their things should not stop. So, it’s a grind actually, I mean in a positive way. You learn every day you get energy from your customers from your colleagues, your employees and you enjoy the process. The whole notion that you want to build Startups because you want to earn money I think it’s very short term. The fun actually lies in the process I mean once you get something you may not enjoy it anymore. But the whole process of going there having struggles every day having challenges. New challenges I mean it might be Technology, hiring, a tough customer. It could be scaled, it could be serving a new segment you know whenever you try to do anything new there is a challenge but the fun is facing the challenge and doing your best to overcome that. So specifically, in terms of challenges, I would say we have a dominant customer base in India like 80% of our revenue comes from India. India is in a stage when things are changing in a capacity to buy software. Traditionally people are of the mindset that software is free. Google is not charging anything so why are you charging. Open source is there and there have been pirated software’s. So, the mindset change is happening and we can see that. So, it’s quite slower as compared to the rest of the world. But we feel that it will change significantly in the next users we already see that change. A super challenge is basically the capacity to pay for that software. To be more specific, the challenge would be hiring, though we are country of a billion plus people and there are tens and tens software engineers coming out of engineering colleges in India and very very few are employable. And most people have taken that degree for the sake of it. People have B.E, B.Tech, M.E. So, we have a process of solving real coding problems. Most of the people just search on Google and type that code. So, we are like ok you have done that now solve that problem again in front of us. And people are unable to do the problem that they just solved using Google by themselves. So, you know very few people that come out of college are actually good and the problem is that all the good people are chased by all the big companies. So, you see that the supply is limited and the demand is more. The really talented people there really costly and if you don’t hear them you won’t be able to scale. You know this is kind of a revolving situation. And I think that would be a part of an evolving economy. So, it is a challenge but I don’t think it’s a challenge that cannot be solved.

Q. Where is the flaw in the hiring process, is it the education system?

A. I think it’s part of the culture. I think our society typically parents, my parents and the people that I interact with they have set professions, they want their kids to be doctors, lawyers. And that forces you to take some sort of a degree in that you might not be interested in, it might become useless for you. I think that maybe because it gives you an economic security but that thing will change with the economic growth. But if there is a society where people are free to choose what they want to do like let’s say somebody wants to choose arts, free to do Maths, free to do fundamental Sciences, free to do Computer Science. Then you’ll get people who are interested in the subject and a really good in the subject. I think the economy could be the reason or culture could be the reason I am not really sure but I think this is something that needs change.

I have two sons the elder one is in fifth grade and I and my wife have told them that they can be whatever they want. You want to become a Chef, you want to become a sportsman or an artist whatever it is that you want to do. Just make sure to be the best at that. So, I don’t say that just because I am from IIT you need to do it your stuff you can do whatever you want you don’t need to follow the same path.

Q. What do you do for fun?

A. I don’t work 24/7, that is what happens when you are a young co-founder. In the previous company that I founded, I used to work for 24/7. So, especially in colleges, people have a habit of working late and I myself used to be a nocturnal person. So, in my previous company Proteus we used to work till 24 we used to sleep in the office but as your company grows, as you get a family, your routine changes. So, you work within a certain duration of time obviously when the situation demands you do work late and you work on weekends but that is not a part of the routine sometimes you have to do it not every time. And you try to be most productive for the duration that you work in. And you also try to be as less distracted as possible so I usually shut down my WhatsApp because that is really distracting. So actually I don’t have a lot of stressful working hours but beyond that, I like to run. I do yoga on most of the days because my wife is a yoga instructor. I play badminton sometimes play cricket on the weekends so that’s all I do.

Q. Where do you think Leadquared will be in 5 years?

A. I think we will be a very dominant company. I think will be among the top 5 companies in the world coming out of India. So, I can’t exactly tell you the size but we definitely will be very very big.

Q. Any memorable experience in Startup journey for new Entrepreneurs?

A. Take care of the basic things in the initial years. This kind of a journey can be really really stressful. If you are not financially secure and your family is not with you then you can become a little detrimental. So experimenting is good but once you find that you have found something and you want to go about it for the next few years, just double check. Double check if it is going to impact your life. I mean ultimately your life is important. The most important thing is having a meaningful life. I mean it does not matter if you gain it by becoming an entrepreneur or by becoming a spiritual guru or by doing something else.

Q. Any major mistake you have made from which Young Entrepreneurs can learn?

A. Mistakes keep happening, mistakes have happened have made a lot of mistakes but the thing is I don’t regret making any of my mistakes. But I have a very fundamental ideology that I am responsible for whatever choices I have made in my life. So, I don’t blame God or any third person for any mistake I’ve made even if somebody gives me an advice then I blame myself for taking the advice. Because you know whatever choices I have made I made consciously so I don’t blame anyone.

Q. What is the future of Startups in India?

A. I think the future of Startups is very interesting. The new generation of people that are coming from families that have economic security. So, you know they don’t have to do it for the sake of money and experimenting with their ideas and some of them going to become a big company.

Also, earlier it used to be that if you’re not working for a big company then it is socially negative for you. You know even in my generation people were not getting married because they were not working for a company but now it’s cool.

So, you know when this happens some company will die some people will learn from the mistakes. But the future is very exciting I have met some people who are really young and full of energy. When you are young you have that thing where you want to change the world. And that feeling is required, unless you don’t have that kind of drive, you can’t make an impact.

So, I think India is in a great phase. Earlier today I was at a conference where I was told that 60% of the Indian population is under the age of 35. So, if that data is correct there are a tremendous amount of people who can do a lot of things. But I just hope that the country should not do something that makes a people go out of India to work. Because people get frustrated with the policies, with the environment and then people might go out of India. And these people will do wonderful things outside India. So, we should use our talent. People are enormously talented. And if those kinds of people are given the right kind of support by the government, by the authorities, by the society I think India can become a great country once again.

Comio launched two new 4G Mobile Phones: C2 Lite and S1 Lite

News

hatankar

-

February 15, 2018

0

Comio launched two new 4G Mobile Phones: C2 Lite and S1 Lite in India that has been targeted towards the youth. Comio C2 Lite is priced at Rs. 5,999 and S1 Lite is priced at Rs. 7,499.

The invites for the launch event, being held on 15th of February said “Hum Youth Ko Lite Nahi Lete“. From this, it is clear that the device has been made considering the young Indian population of teenagers and college going students.

Comio enjoyed early success when it sold over 20,000 units of its Comio C1 and C2 last year within 2 weeks of the initial launch.

comio new mobile phones

Comio S1 Lite

Comio S1 lite features 13 MP of Auto Focus Rear Camera and 8 MP of Selfie Camera with front flash. There are many features available in a camera like Beautify, Bokeh mode, High Dynamic Range, Panorama, etc. The device comes with Android 7.0 nougat and powered by 3050mAh of Battery. It has a quad-core 1.3GHz Processor with 2GB of RAM. The phone has 5-inch of IPS Display with 1280×720 pixels of resolution.

Comio S2 Lite

Talking about Comio C2 Lite, it comes with 8 MP of Rear Camera and 5 MP of Selfie Camera. Both phones feature same Android Nougat 7.0. But C2 Lite comes with 1.5GB RAM and only 16GB of Internal Storage. Battery capacity of C2 Lite is 3900mAh which is more than S1 Lite.

Both the phones support 4G VoLTE, Wi-Fi, Micro USB Port, Dual Sim Slots and headphone jack of 3.5mm.

Comio is also famous for being the only brand in India that currently provides a 15-month warranty on its devices. Though this warranty is limited to west and north zones of India. The company has expanded well enough in these zones and is looking to expand more. Comio mobile company currently has 20,000 dealers across North and West India, this number is expected to double by April this year.

Since the prices of the phones fall under Rs. 8,000, C2 Lite and S1 Lite would be competing with Xiaomi’s Redmi 5A series.

It will be interesting to see the launch of Comio smartphones as Xiaomi is also expected to launch its Redmi Note 5 on the same day.

Micromax Canvas Infinity Camera Samples

Camera Samples

hatankar

-

January 27, 2018

0

The Micromax Canvas Infinity has 13MP rear camera & 16MP selfie camera along with selfie flash. Let’s get a gist of the camera using the below samples.

Micromax Canvas Infinity Front Camera Samples (Selfies):

micromax canvas infinity selfie

micromax canvas infinity selfie (2)

Micromax Canvas Infinity Rear Camera Samples:

[wptb id=29539]

micromax canvas infinity rear camera samples

micromax canvas infinity rear camera sample 8

micromax canvas infinity rear camera sample 7

micromax canvas infinity rear camera sample 6

micromax canvas infinity camera sample

micromax canvas infinity rear camera sample 2

micromax canvas infinity rear camera sample 3

micromax canvas infinity rear camera sample 4

micromax canvas infinity rear camera sample 5

Modern warfare in Telecom Equipment sales to mobile operators

Telecom

hatankar

-

April 29, 2016

0

Modern warfare in Telecom Equipment sales to mobile operators

Competitive Play- the big game
Demand-driven design and R&D
Customer Relations
Perceptions are Differentiators
They will buy from you if they want you
Group of customer Individuals matter
Eventually, it’s the technical rating
How far will you go to get intelligence?
Strategy of War
Perseverance

Equipment sales methodology in the telecommunications industry has changed quite significantly over the last 5 years. And so has the competitive landscape. While in the past it was dominated by likes of Motorola, Siemens, Nokia, Lucent, Alcatel, Ericsson and Nortel, it’s a very different story today. The meteoric rise of likes of Huawei and ZTE in such a short time is the most understudied piece in the telecommunications industry and most of the players from Europe, the United States and the world outside China have grappled to understand what hit them. Explanations are often sparse, confusing and dissatisfactory. Looking at just the Radio Access Network market share, it’s now two European equipment makers versus two Chinese with Europeans shrinking and consolidating over the last years.

Chinese suppliers over the years have executed very systematic tactics, implemented advanced supply chain concepts, mastered customer organizational behavior, strategized and deployed art of war in corporate world, disseminated propaganda to create perceptions, and adopted very aggressive stance many times to be bailed out by the financial and government machinery, which has very few avenues today to maintain China’s growth. It’s not the lower price that wins one business. What it takes to win in today’s world as Telecommunications equipment provider is a thorough understanding and the grit to execute on one’s plan.

Competitive Play- the big game
Game theory, signaling and price discovery happen almost real time during a sales engagement. You come to a conclusion that no amount of study can predict or even ascertain probabilities to an outcome. If you break the price discovery into broader pieces, it will be a function of individual styles of account managers for each supplier, procurement manager, the willingness of the supplier to be a partner, product, willingness of the operator to partner, and certain hidden power centers for all the suppliers and the mobile operator. The interplay of these factors and timing is quite complex. However, eventually, certain patterns will emerge. For example, in a three player scenario, two suppliers will always be close to each other than the third. Questions to ask then are how long these two will stick together, what price levels have been signaled, how each of the players will position oneself and how long can they thwart the third one out. What is important, to win is that one cuts through the clutter and understands on a real-time basis where the competition is heading and then change price strategy based on this real-time information. For example, if you are winning, then where to stop, if you are losing then how to make price situation tougher, and then how should one time these moves. Something the Chinese suppliers have perfected and execute on a war footing. Every piece of information is valued, and a system, that can filter, cross verify, process, think and respond to this real-time information, as well as in place. The only way to beat the game is to play the competitive information game better than the competition.
Another tactic that is deployed is, spreading misinformation that the customer is not spending. This misinformation if spread successfully, will discourage the competition to deploy enough resources in an engagement and will benefit the one spreading misinformation through a larger share of wallet, better margins, and weaker competition.

Demand-driven design and R&D- “Designed, researched and developed to Order”
Demand-driven supply networks are well accepted and understood in the supply chain in manufacturing in industries such as retail, consumer products, automotive etc. In telecom, however, suppliers have taken it to another level. If just in time production, lean manufacturing, and lowering variability in demand data is being perfected to optimize inventory and expedite time to market in other industries, in telecom all of the design, research and manufacturing is a result of customer requirement or real-time demand. Any parameter such as port density, throughput, open APIs, power, form factor, size etc. that is required by the customer is committed at the time of compliances and technical evaluation to reach the number one rating, even though the product may not have been designed or planned at all. Post customer commitment ‘Designed and Researched to Order’ delivers in committed time- for the most part. Any product is the outcome of tradeoffs of parameters such as quality and time to market and the envelope gets pushed further every day. Many times though, quality invariably suffer due to wrong commitments and inability to deliver. However, there is no doubt that this process designed and research to order has eliminated a lot of inefficiencies and resulted in record yields on R&D dollar investments. Looking even deeper into this approach one would realize that to begin with certain risks were taken but as you progressed you could manage those risks. In High Tech industry measurement of key KPIs post-deployment for on-ground performance is very difficult. Risks get managed through fine prints, operator’s inability to measure, agreement or disagreement with the operator on what to measure and eventually a relationship with operator personnel engaged in measurement. Nobody wants trouble with a deployed network. However, “researched and designed to order” is a first that the Chinese suppliers have mastered and despite tradeoffs on the quality they have been able to manage the deployments very well. If not managed at a presales stage one’s product will get killed by someone with this approach even if it is superior. Unless the competition adopting such strategies is killed by highlighting the hazards of design and researched to order, right at the presales stage, one is sure to suffer at the commercial stage.

Customer Relations
Every customer individual you deal with has his weakness and strengths of character. None is perfect after all. It is up to the sales professional as to what behavior he accentuates. However, make no mistake that some of one’s competition is finding it easier to capitalize on your customer’s weakness of character. A simple cognizance will help the sales professional to counter competition by his own attempts to accentuate the strengths of customer’s character. For example, the greed of an expensive dinner can be countered by a personalized training of technology concepts that can help one progress in career. What’s important though is aware of attempts by your competition at the individual level and a countermeasure through one’s own positive engagement. Pulling your customer out of your competitions grip of especially if one has slipped deeper will never be easy. However, full awareness of the situation and having one’s own plans to help one’s customer succeed personally in an ethical and positive way will be much more rewarding.
Perceptions are Differentiators
In technology selling, a great amount of work happens to evaluate the technical specifications. Given, that some of the suppliers are adept at committing to higher specifications which are still in the works, selling becomes a game of perception. In such a scenario those suppliers who stick to their own product specifications and aim to defend them are always playing a catching up game. The perception game then begins. Pick up the parameters where your competition may be most vulnerable, commit to a higher specification and then run the better perception campaign at every level in the customer organization through constant messaging and propaganda. After a point, the same message starts to resonate after several reflections by various customer individuals in different meetings. This is how one’s product gets established and eventually the perceptions start to determine if your product is a differentiated one and is rated better.

They will buy from you if they want you
A sales engagement is a long drawn process with its twists and turns, ups and downs and sometimes it leads one to a situation wherein ambivalence to push one’s customer any further or waits starts to dominate vision. What’s important to keep in mind is that you can sell only if the customer wants to buy from you. Has one managed to create a want or desire for one’s customer to buy one’s products? This want or desire supersedes any strategy, plan, or trick. The focus on every effort than should be to create a bigger need and developing a desire in your customer to want your product. Price discussions are contingent on big is they want.

Group of customer individuals matter
A sales engagement especially a “Request for Proposal” driven one involves a number of touch points and many stakeholders in the customer’s organization. From an execution standpoint, it is important to manage the whole process to meet the requirements. However, one has to be cognizant of the fact that eventually there will be very few, perhaps only 3-4 individuals that would decide the fate of participating suppliers. One has to identify, and engage them and make a constant attempt to position and demonstrate one’s differentiators. The point is that if energy and resources have to be channelized, it has to be on this group of customer individuals more than the other stakeholders. It is ironical that all the efforts, hard work, and engagement will culminate in decisions taken, basis the perceptions and judgment of so few individuals. However, that’s the harsh reality!

Eventually, it’s the technical rating
Most of the sales managers would always harp on price as the most critical element of winning a deal. That’s not completely untrue. However, in reality, the battle is won in the technical stage. The harmless appearing technical meetings where discussions are mostly, genial are the most treacherous. Minds of technical evaluators are constantly working measuring and rating one’s products though it may not appear so. How the technical evaluators are constantly rating one’s products will determine how eagerly, commercial teams will be willing to negotiate with the supplier or pay a premium for the supplier’s products at the commercial stage. Winds are not always in favor of a supplier. What will withstand the pressure of time and lobbying by one’s competitor is the rating of one’s product which will remain an undeniable truth and survive various tests during a sales engagement. So a high technical rating is indispensable.

How far will you go to get intelligence?
There are references, innuendoes, and few very harsh accusations on few suppliers that they go to the extreme to get competitive or customer intelligence. In today’s world where smartphones are everywhere, it is very simple to click a picture, make a video or record a conversation. On a similar note, in today’s materialistic society, where traditional values are fast eroding, every means gets justified, and the lines between right and wrong are fast eroding. Sometimes, ethics are hard to explain if you question the very principles of modern organizations. If the objective of one’s organization is to create shareholder value then what entitles shareholders to make disproportionate profits as compared to salaried individuals who are sweating and slogging to make those profits. If the objective is to create stakeholder value then again, why are financial benefits not proportionate to all of the stakeholders? Most of the times, those in the position of decision making in customer organization get swayed and fall trap to the slippery slip of taking material or other favors, consciously or subconsciously. Out of fear of misalignment with seniors or for personal benefits, even cautious individuals in organizations do get swayed completely in favor of certain suppliers, even though their behavior is not in the best interest of their own or their organizations. Most of the times realization dawns too late to make amends and the personal and organizational damage is done. Besides, it is extremely difficult to correct one’s course.
The most sales person, will increasingly, come across this situation. We recommend that one sticks to one’s organizational values and path of righteousness without falling into the temptation of gross wrongdoing. Of course, one has to keep one’s eyes and ears open. Competitive or customer intelligence when traded, should be in exchange of knowledge, education, better project and supply deliveries, and offering career enhancement opportunities for the larger benefit of the customer organization, individuals, and relationship of trust. No material or cash benefits should be traded to seek intelligence, is the bottom-line.

Strategy of war
Most of vernacular in cultures across the globe are filled with wisdom on winning strategies on war. More of these strategies seem to have taken over industries today. Whether it is the Art of War or adages that tell you to surround a city to take it down, you can find war tactics implemented all around you in a sales situation. Intelligence and espionage, strategic attack, forces, variations and adaptability, and so on, all of these are adapted to a deal scenario and deployed in a very systematic way. The only choice one has in order to sell is either to be alert, intuitive, aware and smart to deal with situations as they come or train one in these strategies. These strategies are deployed and executed in a planned way by the suppliers and they have their organizational apparatus at the senior sales and management level executing at a mass scale. A supplier is sure to get killed mercilessly without deployment and execution of one’s own strategy of war at every level in the customer organization.

Perseverance
A sales cycle follows its own path, like a free-flowing river. To stay the course the one quality that will see one through is perseverance to survive every terrain, season and time. There will be times when it may seem like the end of the road. What is important to keep in mind is that organizational relationships don’t get built or broken in days and months. It takes time for relationships to mature and once built they do not break so easily either. Keeping a longer-term objective and considering every success or failure a milestone is the only way one can build one’s own or one’s organization’s credibility.
There are no shortcuts to success and there is no substitute for success built on sound fundamental values.

Telecommunication: Why are multi-million dollar deals hard to crack?

Telecom

hatankar

-

December 12, 2013

0

Telecommunication: Why are multi-million dollar deals hard to crack?

Large Telecommunication vendor corporations are increasingly facing a situation wherein they face few very large deals that make up for most of their business- old Pareto principle. This means huge risk to these organizations in terms of growing and retaining business quarter on quarter as more and more, few players in the market, compete for these few large deals. While, operationally these organizations seem to be equipped in terms of people, tools and resources, however from a sales perspective, this situation puts huge responsibility and focus on very thin sales organizations. These organizations make huge investments in developing and grooming their sales force, in the hope that all their investments would bear fruit when a transaction or deal happens. And glaringly those closer to these deals would tell you, that the picture is quite different, at the time when the bid happens.

A typical quarter 100M USD deal will require investment from pretty much the entire vendor organization and craft such a large deal from an individual’s perspective is more artwork than a science. While on the surface all activities might appear to happen as per the plan, however, anyone with a critical eye would see large gaps the way deals are executed. You may still win or lose a deal because your competition is equally bad or worse, however attributing these victories to assumed organizational capabilities or losses to just the price, is a trap that most leaders in these companies, knowingly or unknowingly fall into.

While creating shareholder value may not be the ultimate objective in these leaders’ mind, however leaving their personal success and thereby their organizations’, on a high degree of chance definitely concerns them. And despite their concerns, most might still be willing to go with the flow, not to cause any disruption and run the risk of jeopardizing any chance of success. Even with this benign approach, there are possibly some simple gaps that can be tackled effectively, with a very operational approach. The list is below:

No central intelligence on pricing.

Most close to the deal know that if they lose the deal then pricing will be blamed. And so the game begins even before work on large deal begins. The person who is the sales responsible starts to paint a grim picture right from the beginning that company pricing is at a premium over the competition. This is also the biggest worry for the top leaders, who on one hand have the responsibility to secure margins and on the other, have to negotiate on pricing at a stage of the deal when, the building blocks for the deal that are to be negotiated, are expensive by themselves. So any price cuts hit the margin.

Looking at it from an operations perspective, every large-scale deal in telecommunications is a built to order rather than the assembly line. So intelligent pricing of these deals requires a huge amount of intelligence on the vendor’s part to do market benchmarking of individual components to know market price, understand the scope in terms of what is needed of the customer and not asked, customer, region or worldwide strategy on pricing and so on. In most cases, all this is left to the intelligence of the local unit and the individual’s ability to cull this information from unofficial sources, which is more a reflection of personal heroics than a systematic approach. Pricing is also a regulatory and legal issue, so unless a company has a well thought of approach it will always be left to individual brilliance than a winning strategy.

The second issue with pricing is lack of skills in these organizations to price such large-scale deals. So in most cases, the price is a sum of parts of individual solutions and then aggregate margins. While a large part of the risks and benefits associated with a deal are expected to have been thought of by the solutions team, organizations can be really smart by benchmarking similar looking deals, lessons learnt from similar deals, manage cash flow assumptions on each of these components, reuse the already bought licenses, activation codes etc.
None of this happens today and the result is suboptimal pricing that kills the deal even before it goes to the negotiation table.

Hero culture in a knowledge economy and human insecurity

Most of these companies have a hero culture wherein top sales people are rewarded. The reality is that when a deal is happening, on the ground you need more than one person to contribute in terms of knowledge, relationships, connections et al. No one person, can effectively, be the sales responsible, and contribute fully individually as requirements of an effective individual for a deal are a combination of personal intelligence, technical knowledge, internal and external relationships, financial savviness, hard work, energy and enthusiasm, communication and negotiation skills and collaboration. Every sales person realizes the expectations on him and so everyone finds their own way to cope with it. Most build a shell around themselves wherein they pretend to know it all, steal from their peers and convince themselves after stealing that it was their own idea, underplay the importance of skills that they don’t possess, thwart people who they believe would be a potential threat to their recognition in future and so on. The price is a huge one for the companies. Most individual depend on the fact that they bring one or two very valuable skill or ability and thereby not just risk the deal but because of their short-sightedness, also their own career, by not acting in a way that enhances everyone’s chance of a success. This can also be called the pervasive sales culture in today’s corporations.

The other factor that is playing a key role in today’s sales person’s psyche is job security. Over the years, employees were expected till 60 and then retire. However, today’s corporations have a put a life of 3-4 years to sales roles. This has created a certain disharmony in a sales person’s professional and personal pursuits and this also reflects in the work style of the sales force. They put their personal interest over larger interest. Combined with this is also the issue of compensation structure. From a financial perspective, the risk/reward ratio now seems to be getting tilted towards operations and sales support role, where roles have certain longevity, compensation is only marginally lower- in fact in certain instances overall higher, making non-sales roles more lucrative. This is increasingly pushing top talent away from sales profiles, where a company would want to put its best people.

Technical complexity versus optimization

Most of the solutions required for large deals are very complex which are a combination of a lot of software, hardware and services. This volume of software, hardware and services brings in a lot of complexity. Theoretically, the problem is not very complex to solve however in reality given that information resides in different pockets of the organizations with different individuals and in even different parts of the world; makes it very complex to put all the information together and come up with a simple solution. And those who possess such a skill consider and behave with a lot of self-importance, making the solution process even more difficult. Different incentive structures, motivations, individual attitudes only add to the complexity of the problem. What is lost in this complexity of information pockets, individual attitudes, and complex solution is the ingenuity that is required to optimize the solution. Optimization requires intelligence and brains, and most of the teams and individuals avoid this harder problem and hide behind complexity.

A complex solution which doesn’t include the sharpness of optimized and smart solution is always more expensive from a technical and services point of view. By the time deal negotiations start, the deal is already lost somewhere in the complexity.

Lack of belief in the technical superiority

Organizations, both internally and externally are full of marketing material that claim their superiority. However, when the solution is being dimensioned, the teams involved, show a complete lack of trust in their technical superiority. This eventually reflects in their dimensioned solution proposed. It becomes very difficult to even argue with the sales team, on this topic as they know how to evade this discussion, by finding excuses or even making personal attacks on the people questioning them. It’s a complete break up of marketing with sales and a complete failure of all the investment that organization has made in internal training, knowledge sharing, sales development, and so on. Still, this phenomenon is everywhere and in every deal. An oversized solution which doesn’t capitalize on technical superiority is more expensive and this becomes another factor behind a deal-breaking even before the negotiations.

Organizational setup

Today’s matrix organization may have put accountability on the right heads, however, are these companies organized to ensure the same commitment from all needed and reward them suitably is a different story. When decision making with the customer is decentralized, getting the same level of commitment from group functions, local units and global units is very hard to achieve.

Also, the sales process may have been defined but decision making is not the only place where you need participants to nod their heads. What information do they have really to make a quality decision? Sales process has to ensure participation and commitment from the entire organization at every point.

These are just a few high impact points which if addressed can better ensure the result of a complex high value deal.

IMS- the making of another lost opportunity for operator on applications- RCS. VoLTE takes network evolution and some voice revenues will be lost. Joyn is unlikely to succeed. Fixed / Mobile convergence will differentiate the operator

Telecom

hatankar

-

February 5, 2013

0

IMS- the making of another lost opportunity for operator on applications- RCS. VoLTE takes network evolution and some voice revenues will be lost. Joyn is unlikely to succeed. Fixed / Mobile convergence will differentiate the operator

IMS is more notorious in the telecom world than any other technology for the last several years. A simple quote from a vendor will easily run into a few million dollars for a barebone solution with a business case which relies on passionate optimism than any real success. While fixed line operators successfully implemented the technology and benefited from it in terms of low cost and feature-rich applications, the mobile world is coming to terms with it now. For the last several years, mobile operators like Deutsche Telekom and Vodafone made small implementations both hosted and in-house in the hope that applications running on it will someday have enough revenues to justify the investment. Most of the implementations died in vain with dead business cases, while a few lived on to tell their story as innovative and intelligent platforms on which future operator successes could be built. Operators world over love to call themselves as different- most as innovators than as low cost. However in the struggle of spectrum auctions, regulatory requirements, running the network, M&As and changing technology landscape, few successfully execute beyond talk. Every application launched by an operator in the last few years that competed with an over the top player begged the question of interoperability between operators, locally and globally and none so far succeeded. And none probably will.
Without ado, IMS is right on their face now because Voice on LTE will be several billion dollar businesses and IMS is required of it. So the big question is what’s going to happen.
Broadly the IMS question has 3 key parts to it- Voice for both current GSM and CDMA operators, applications like Rich Communications Suite and others, and then fixed-mobile convergence.
This write up covers all three aspects of IMS and what is likely going to happen on each of these

VoLTE
In this area lead has been taken by Korean operators SK Telekom and LG U+ and US CDMA operators Verizon and Metro PCS who are anticipating fewer handsets from vendors as the technology phases out. European countries such as in Scandinavia who were pioneers in LTE launch way back in 2007 are a bit of a laggard due to slower adoption of LTE. Countries like the UK and Italy are now slowly rolling out LTE but the mindset is more to sweat WCDMA investment before jumping on LTE.
Technical challenges apart the biggest question for US operators are two-fold. Mobile broadband as its forecasted to grow will break all records of consumption in which case operators will have to re-farm their 2G, 3G networks for LTE. What will happen to voice then? Secondly, as mobile broadband becomes pervasive OTTs like Viber and Skype will further strengthen their business, seriously hurting operator’s voice revenues, which along with SMS comprise 70% of operator revenues today.
At this point, I also want to dispel the myth that Voice on CS-2G, 3G is cheaper than Voice on data, from spectrum utilization or radio perspective, for the simple fact, that CS voice takes 10-15 times more spectrum than similar speed on data. Or the same number of users that can be supported by 5 Mhz spectrum for voice can avail themselves of 10-15 times more equivalent speed on data. Further, LTE can support 3 times more users on voice WCDMA and 6 times more than 2G.
Coming back to the two points, on why the operators will have to move to VoLTE and hence IMS, I believe the sense of urgency will come from point one. Operators have miserably failed in the past to really tackle OTT and in this case, whether due to regulatory or business alacrity issues they will not be able to stop Viber and Skype. However, mobile broadband will necessitate operators to refarm 2G, 3G and give an alternative for voice through VoLTE and hence IMS.
Other benefits like HD Voice, lower call set up time, jitter etc. will follow.
Nonetheless, operators will claim that they successfully thwarted the OTTs. That’s the nature of the business, unfortunately.

RCS and Applications
Anyone and everyone in hardware business whether its device, Switch, IP or server manufacturer knows that future growth lies in applications and software. And telecom operator knows it too. But for reasons known and unknown, none of the operators attempts made in the past such as Vodafone 360, INQ, social networks, music and video services have come anywhere close to Facebook, Spotify, Deezer et al. What operators have become the smartest is in bundling and pricing.
Rich communications suite which offers, instant message, chatting, file sharing, network address book, voice and video chat has been around for some time and now has gained a new impetus given the IMS implementations required of VoLTE. Unlike the past, led by Vodafone; DT, FT, Telefonica, TI, and others have come together to launch an interoperable service called Joyn backed by GSMA. Joyn is called RCSe which means it is without presence. So far launches have happened in Spain, South Korea, and Germany with handset vendors supporting the initiative. Interestingly Zain in Quwait plans a trial, supported by cloud capacity provided by Vodafone. The point is that there has been no real impact, though it has been at least a year or so for this initiative and at least 4-5 months since launches.
On the other applications side, skepticism stems primarily from the fact that operators have long tried to create an ecosystem of developers etc. through their own applications stores, open APIs and portals etc. Many of these initiatives like Verizon’s application store were unceremoniously shut and others died or are still languishing doing little justice to the fanfare with which they were launched just a couple of years ago.
The same problems that led to the demise of operators applications stores and alike will ail open API, in-house, outsourced or partnership driven application initiatives on IMS and this will be a passé discussion few years hence.

Fixed / Mobile Convergence
Based on what Rogers has achieved through Rogers One Numbers and China Mobile has achieved through 3G life-G3 communications- one can safely claim that fixed/ mobile convergence use cases based on IMS have a strong case for consumer preference. One number across your PC and mobile through which you can switch your calls from phone to PC. Conferencing, chatting, call routing to all devices on a number, voice and video chat, have all seen initial and significant success, and it is a very good tool for an operator to differentiate themselves from others. Besides, it helps an operator to realize strategic benefits from IT investments across multiple IMS implementations at the back end. Several operators that offer both fixed and mobile services will leverage this synergy to bundle and price their offerings in a way to maximize their revenues and gain an edge over the competition.

Bottom line, in 2-3 years VoLTE will start to become mainstream, Joyn and RCS and any application related initiatives by operators will not succeed and the fixed-line operator will have another weapon up their sleeve to go out and differentiate themselves from the competition.

Mobile Broadband in 2012- Recommendations for mobile operators for market segmentation and pricing to differentiate and stay profitable

Telecom

hatankar

-

June 22, 2012

0

Mobile Broadband in 2012- Recommendations for mobile operators for market segmentation and pricing to differentiate and stay profitable

Mobile Broadband market in 2012, is at an interesting stage and is almost an academic example of an industry grappling to segment the market, price it and remain at least profitable if not maximize it. There are numerous studies that will indicate that at current flat price data schemes for mobile broadband, investments will far outstrip consumption or revenues. It can perhaps be argued that the entire industry got entangled with issues related to data abusers for a long time; But now telecom operators will tell you that data abusers of flat rate tariff on data volume (GBs per month) don’t comprise more than 2 to 5 % of the overall subscriber base. So the flat rate data schemes with fair usage that were rolled out across the world during most of 2011 and so far were not relevant for 95% of the market which never contributed to data abuse. Guess it all started in 2009 with AT&T.

Now that we have better understanding of data consumption in future, it’s going to be an exciting time for the operators, to explore, discover, innovate and succeed in segmenting the market, rolling out different pricing schemes and then build long-term and hopefully sustainable differentiation; all supported by highly advanced and complex technology landscapes. Not forgetting that one player/ operator, who will not shy away from cutting prices down unprofitably, to spoil all the hard work; strategies adopted by operators, have to be sustainable in 2 to 3 years horizon. And then, of course, you have the well funded OTT players, But that’s the story of the industry for at least 10 years now.

Here’s what we recommend telecom operators should do:

1) Focus on that 10% of the premium subscribers that bring in most of your revenues. Any churn in this base means, huge impact on revenue loss. Various reports have different forecast, but it can be safely assumed that 70% of the mobile broadband traffic will be Video (Cisco VNI report), and close to 20% would be web/ data. Similarly close to 40% of the subscribers cause congestion in the network at some point or the other. What simplistically this tells us is that I have to provide better services to my 10% of the subscriber base who contributes to most of my revenues but suffers during congestion because of another 30% who don’t give me as much revenue. In all likelihood, my 10% premium subscribers would be streaming video, or uploading videos on the internet, or browsing some newspaper site, or doing banking. So how is it that I can make life easy for them and keep them. Remember any reduction in churn from these customers is savings in loss of revenues.

2) Pick one service that you think you can really beat the Over the top player. Any competition with google or apple is not easy. But operators have the advantage of operator billing. Remember prepaid is seeing increasingly fast penetration even in the US now. Google and Apple don’t store the credit card information of prepaid customers. As the days of economic gloom get extended, this trend will only increase. So if there is one service, most likely video- mobile tv- that operators can do a good job, then it has the potential of becoming a money spinner. Question is how do I ensure, the quality of just one service without massive investments on upgrading the network.

3) Build variables in your network, that will help you implement different strategies. Any price plan by mobile operator today is a combination of Data + Voice + SMS + may be a service like Facebook in the developing world. They key is, whether operators have the ability to try speed, and a combination of services to differentiate. More importantly, do they have the ability and wherewithal to try a new business model. The services will get segmented even finer now, for example, a video where consumer and service provider are unwilling to pay versus banking where service provider if not the consumer is willing to pay. Can I capitalize on it? And how?

4) Last is the whole machine to machine wave. The jury is out on what role operators will play except connectivity. And before making a blanket recommendation, we believe machine to machine and enterprise segment is an area where not all operators will be able to play a role beyond connectivity

We will follow up on what happens in a quarter from now and provide more updates on trends.

Why will Operator application store in India- Airtel-App Central, Aircel-PocketApps, Vodafone, Idea – IdeaMall, BSNL, Reliance-R apps-FAIL?

Telecom

hatankar

-

May 9, 2011

0

Why will Operator application store in India- Airtel-App Central, Aircel-PocketApps, Vodafone, Idea – IdeaMall, BSNL, Reliance-R apps-FAIL?

There has been a slew of activity in the last few months, wherein all the big operators have launched application stores in India. Airtel launched App Central in partnership with CellMania, Aircel launched PocketApps based on Infosys Flypp platform, BSNL has partnered with CellMania, Vodafone with Arvato and Idea and Reliance have launched IdeaMall and RApps respectively on Ericsson. There has been a slew of activity in the last few months, wherein all the big operators have launched application stores in India. Airtel launched App Central in partnership with CellMania, Aircel launched PocketApps based on Infosys Flypp platform, BSNL has partnered with CellMania, Vodafone with Arvato and Idea and Reliance have launched IdeaMall and RApps respectively on Ericsson.
There are certain fundamental errors in the execution of these application stores that are impeding success.

1) Operators, internally are not geared operationally to run these services. The thought process at the highest level and all the supporting processes laid out for application stores and VAS services are all adopted, inherited or used directly from the Voice business. For example ROIs in terms of actual revenues and profitability start to get measured, as soon as a couple of quarters from the launch. Most of the data related VAS services have long gestation period and business models during the initial years are supported more from a valuation perspective wherein valuation models build actual positive cash flows and profitability at least 3 to 4 years ahead. In direct contrast, these application stores and similar VAS services lose internal interest as soon as it doesn’t impact the revenue and profitability KPIs in the first few quarters/years.

2) Revenue share agreements for most of the content contracts are unfavorable to content providers and are now killing the ecosystem. Operator keeps anywhere from 60%-70% of the revenues. The only value operator adds is billing relationship with the customer. For 30%-40% revenue share content provider is expected to provide technology and operations, spend on promotions, do back to back payment to content developers and most importantly run the risk of competition. This is killing the ecosystem. No wonder Over-the-top players like Google Android, and Getjar, and original equipment manufacturers, like Nokia, Samsung and Apple which provide credit card based billing are increasingly taking revenues away from operators. Content providers can’t spend money to build operator branded property, pay the developers and be profitable at the same time.

3) As has happened with many services in the past Operators will have to pay through their nose for some of these mistakes in future. For example in the past operators had to launch Facebook zero and make data free for facebook access to subscribers because of its popularity. Operators did have the chance to launch their own social networks, but they were unwilling to let go of the data revenues or free access. Same is the case now with operator application stores, wherein they are unwilling to promote them even though it is their own property. And even unwilling to let go of some revenue share though application store revenues are a miniscule part of the voice revenues.

4) Operators in general don’t understand the business philosophy behind VAS or internet ventures. Most of the operations and ecosystem in this business is backed by huge amount of venture fund or by very large public companies. The key metric in these businesses at least for the initial years is valuation wherein positive cash flows are multiple years ahead. Operators will have to develop completely different business skills wherein they are not dependent on vendors to develop technology and should not focus only on marketing activities. They should hone some of their skills on financing, and divesting these new age business. Internet companies are ambitious and believe in talking to the consumers directly, unlike Nokia or Ericsson that operators are used to working with. Imagine when Google, or Facebook will start bidding for the license. If Google acquisition of Motorola mobility is successful, operators will definitely see some competition from over the top players.

5) India traditionally uses low end feature phones. Surprisingly, most of the data gets consumed by phones that are 128 and 176 pixel size-phones such as Nokia 2690, 2727 and Xpressmusic. The trends show that new entrants like Micromax, spice and lava are seeing high growth in sales of their feature phones that also support java. What this means is that an ecosystem that creates content other than wallpaper and ring tone for feature phones has to get developed for most of the 30M+ active mobile internet subscribers. Looking at it from a developer perspective he will create an app and provide that to multiple platforms including that of operator.

The question is who will create the ecosystem to create India specific content. The one who creates that will be in the best position to capitalize on this market. With India specific developer programs run by OEMs languishing, it seems that aggregators such as indiagames, nazara and Hungama are in the best position to capitalize on the opportunity. But then with only 30%-40% revenue share they don’t have the budgets. What is going to happen is that Android phones will become very popular. Android market place will offer credit card billing to begin with. And when the adoption of Android phones becomes very high they will arm-twist operators to give operator billing at a more favourable revenue share to Google. Currently, Nokia does have operator billing for Reliance. The moot point is that operator will let this opportunity go away once again by not helping create a flourishing eco system.

Mobile Entertainment Market 2010 – Apps, Mobile Media Business Models, Growth Markets, M Commerce : Part 2

Telecom

hatankar

-

July 13, 2010

0

Mobile Entertainment Market 2010 – Apps, Mobile Media Business Models, Growth Markets, M Commerce : Part 2

Continuing the part one of the updates on Mobile Entertainment Market 2010, here are the next set of panel discussions.

Apps: Planning for Success in the Apps World

This session was moderated by Dominic Pride the Managing Director of The Sound Horizon. The participants of the debate were:

James Parton, Head of O2 Litmus, O2 UK
Kunal Gupta, CEO, Polar Mobile

Patrick Mork, Vice President, Marketing, Getjar
Andrew Fisher, Chief Executive Officer, Shazam

The key takeaways of the panel discussion are:
1) Getjar has joined the one billion dollar club and has more than a billion downloads now
2) Shazam’s mobile music discover service identifies over one billion songs and has 75 million users now
3) Lee Epting responsible for Vodafone global content services says that an important topic is a discovery with around 40-50 app stores competing now for customer attention, all in a 4-inch screen. Vodafone is now engaged with every OEM and believes in coexistence. Lee believes that an enclosed system like Apple is not really a negotiated topic. For app stores, Lee says “You need good strong recommendation engine in the app store world. You should have a strong promotional program for the content provider and should look at criteria such as demographics of the customer and combine that with purchase behavior for strong recommendation capability. With recommendations, you see as much as 4 times more purchase behavior. Then you should back it with strong promotions.”

Question to Lee on Vodafone 360? How do you play with handsets and OS

4) 360 is quite different as you have a single instance platform for all of the content as well as the new apps

Andrew Fisher (CEO Shazam):

5) Discovery is the most important in 2 ways:
a. Halfway through once, you have got them there
b. Once they are there than in-store marketing for purchase. Retail-centric
6) Adsense model is the best model for apps. Allow developers for bid. Then they should run multiple campaigns
7) Personalization: so that every time an app is uploaded the consumer gets a personalized page. Developers and brands can then be promoted.

Patrick (VP Marketing Getjar):

8) (Do)Promotions for developers and brands through twitter and facebook. Get them to GetJar from there. They hit the page and that helps developers to promote.
9) Experience should be beyond the download and it should be engagement. How do you build engagement? In the publishing space, updating content can bring engagement- Daily, Weekly, Month, for some of the popular titles
10) Personalize the experience. Include stocks that user browses. Sport: Hockey teams refreshing the content and personalize. Apps have a Churn rate: shelf life of 14 to 21 days before they get deleted. How do you increase that
11) Customer acquisition: Spoke about Virtual credits that can be used for more downloads and which can be offered at the time of registration

Andrew Fisher: Shazam

12) Shazam apps have a big audience. You have to understand what who they are and what they do. So that you can segment. From ala carte to subscription-based to bundling and. All you can eat models which can be very broad but for the customers are willing to pay. Then you can decide how to share (between different players)
Some discussion on app city: all apps for all mobiles

13) The other key area that was discussed was in application micropayments. In application, micropayments have to begin which will allow companies to build the smarter application. Give them better information so that they can improve
Getjar Patrick:
14) In app store business, If you don’t have scale today then good luck. Already consolidation in this space. Getjar value prop is significantly different. Have 3 dozen deals were nxml feed to send content.
15) Viral marketing works well. 70% of the guys who come are recommended by someone.
Andrew Fisher: Shazam
Question? Which Platform.
16) Do you want to be a part of the iPhone 75 million devices, 200000 competitor, or a billion apps with 1.6 million visitors a day? The question is how much competition do you have? It’s not just about building the app. The prices are huge but you got to start. Look at the stats and then plan your strategy. Plan for success
Billing Pricing
17) Pricing strategies for GTM:
a. Free app
b. Paid app
c. Ask the customer to choose. 30% drop off from free to paid.
Getjar Patrick:
18) Free apps make money. 20% and more in the US is prepaid users. The fact is that many consumers won’t pay for content. You do have people that would pay for the content. A number of cases shazam, flirotmatic, nimbuzz virtual credit.
19) The best model is Freemium and then upsell content
20) In terms of content- Premium content will have a role. Apple shows that with the right system you can monetize premium content
Lee Vodafone:
21) Vodafone objective is to offer Tariff plans to have the best content propositions. Vodafone has to bring a differentiated offering. Really don’t have to care about other aspects. Then there’s the question of revenue share: 70:30, 80:20. Vodafone then leaves it to the likes of Andrew in Shazam

Other topics:
22) Should have an Advertising API and an Ad network that is suitable for that to allow you to do Freemium models
23) Brands and agencies are getting to grips with what iPhone represents now. How do I go beyond the iPhone?
24) Portal has to give way to the retail store. Deportalization of mobile internet and Appification of the mobile portals
Future hope:
25) DRM free world for apps
26) WAC
27) Get into 70:30 rev share model and premium placement and give the developer real value

The next session was

Enabling Services: Capitalizing on the Next Generation of Mobile Media Business Models

The participants were
Eden Zoller, Principal Analyst, Consumer Practice, Ovum
Tanya Field, Director, Mobile Data Group, Red Telefónica S.A.
Ray de Silva, Head of Enabler Commercial Partnerships, Vodafone
Jon Billings, Head of Technology for Mobile, BBC
Andrew Budd: mBlox

Jerry BBC
Key enablers for next-generation business models:

1) Location awareness. Future props on news weather, just to the regions where we are entitled to provide content. We cant broadcast to th US or ESPN cant do it here.
2) Quality of service is another point. Don’t know the actual dynamics of the network. Congestion: Visibility to these conditions and then can provide better services e.g. Networks is too congested. Visibility to choosing different bit rate and coding. We can even decide a different medium: text instead of video.
3) Cost expectation. Largely customers don’t understand billing. Terrified of billing. Offer super transparency to consumers on how they will be billed.
4) Having common technology: Common technology to address scalability. BBC is working with operators on a global level on this aspect

Andrew Budd
Enablers:
5) Delivery quality and cost of delivery
6) Billing
7) Handset gives a context link on where they are
8) Talks on single standards for APIs with all the operators.

Vodafone:
9) On single API: not possible to have APIs for every regions and markets requirements
10) Web services APIs are going to be widely used
11) Fragmentation will exist. Needs to be done on a more holistic basis as Network operators are not the only players

Sender pays model, and GSM one API discussed

Telefonica Tanya:
Issues with future models:
12) Consumer Education
13) Mind share problem. Developer community is not particularly warm (with the operators). Don’t want to compete with future APIs on Google.
14) Operators missed the opportunity with the location, but there are others available with not necessarily 70:30.

Security issue discussion:
15) Vodafone Ray: Don’t over cook on the security on the APIs. There are 100 million people on facebook that are willing to share every piece of information. Though this is important.

There was a session on MEF Business Confidence post this session. You can get the full report from MEF. The discussion after this was on Growth Markets. The topic was:

Spotlight on Growth Markets: How Have Growth Markets Ensured Success?

The session was moderated by Gerrit Jan Konijnenberg, EVP Sales, Comfone. The participants were:
Ron Czerny, Chief Executive Officer, Playphone
Neeraj Roy, Chief Executive Officer, Hungama Mobile
Pavel Roytberg, Director of Product and Service Development, MTS
Evgeny Kosolapov, Chief Executive Officer, United Fun Traders (UFT)
Neslihan Ucar Cadirci, Partner and Services Management, Turkcell

Neslihan Ucar Cadirci, Turkcell

Key facts and ideas:

1) Turkey is a tough market. Very regulated. 2.5 M using 3G services. Data usage has increased. Mobile music and mobile tv are key. TuckeCell is very successful in mobile tv business in foot ball countries. Football is defining success on data usage. Decrease in revenue because of regulatory issues due to Misuse of billing. Now have double opt in. Adopting, good regulatory practices.

Ron Czerny, Chief Executive Officer, Playphone:

2) There is an Ingame virtual goods company for social media in Japan which has 4 billion market cap. (probably DeNA). You have 10-15 very interesting model

3) There is a company in china called 10 cents which has a market cap of around 10B. Operators must support social gaming eco system. Use this eco system like say a sales channel. And then do some kind of revenue share.

Pavel Roytberg, MTS

4) MTS is implementing NFC in Moscow metro. In Russia, WAP is for content and mobile internet for browsing and price difference between the two is huge. Mobile internet is 13 times more expensive. Traffic revenue is shared to for content. Premium internet traffic customer doesn’t pay for content or subscription. Customer allows distribution for content without payment if he is on premium traffic. Now some people cant understand so this model is an experimental model.

Other items
5) Currently, SMS is the billing mechanism but ultimately billing will be more full integrated with some of the services. Security issues around mobile. We are 5 years away from ultimate billing.
6) Neslihan, Turkey: In turkey mobile payment is growing very fast. Tax rate is 48%. Which is killing business. In turckcell, we are not sharing wap. But that is changing.
7) MTS Russia: You have premium sms scratch cards that you can buy anywhere and you can spend them for virtual goods. Facebook have their own billing system. Russian SNS tried to have some payment system for themselves. Biggest amount of money from social network came from premium SMS. In Russia, you have some payment terminals which is like a reverse ATM. Historically this was for mobile payment but now for virtually everything. These have become trusted. Cards became irrelevant in Russia because of reverse ATM machines
8) One of the speakers (Ron) : Smartphone arena in growth market is a long way to go. China Unicom sold only 3 out of 5 million inphones. Android will come with much more open architecture. Will the app store have the same kind of heightened impact in emerging markets. People who bet on the app store are suffering. Its not viable.

Another speaker (Evgeny Kosolapov)

9) China has 800m mobile subscribers and 800 m mobile devices. Half of them came from MTK chip which includes all the functionality of handset. Chinese can make any handset on this chip set. There is a market there.
10) MTS: Gray market for applications and subscribers want to have the full experience on the gray import of those handsets in Russia as well. On one side operator is a trend setter. You have the other side. Those who follow this gray market will increase their possibility of business models around it.
11) Turkcell: Ad funded model. Trying to mobilize the developer community which is closer to Turkcell and try the combination of entertainment. We had applications for the last number of years and hundreds of games.
The next session was mobile commerce. The topics was

M-Commerce: Leveraging the Unique Attributes of the Mobile Device to Drive Customer Acquisition, Retention & Conversion

The participants of the discussion were

Gary Schwartz, President and CEO, Impact Mobile Inc
Mark Britto, Chief Executive Officer, Boku mobile payment services- operator billing.
Peter Garside, Regional Manager, Western & Central Europe, Ericsson
John Orlando, Managing Director, 2 Ergo
Someone from Buongiorno and Orange as well

1) Consumers want to buy content in a simple fashion with Carrier billing in the background.
2) Peter Garside: premium SMS real success because of ease. Easy way to build for mobile content. Content companies can stomach it is convenience fee. And the consumers are prepared to pay for that.
3) Micro billing payments works best with mobile phones.

Boku (Mark Britto) Micro payment
4) Little back ground: Found 10 years ago. Connection with the carrier. Couple of years launched a service wherein you accept the payment on the website with a mobile number. Rapid growth in the first couple of year. Facebook networks and gaming industry adopted. You can access the game for free and then buy premium on the way and thus capitalize on the Impulse purchase. Mobile comes in as you capitalize on the impulse and get back to what you are doing. Gives end users the ability to do carrier billing and ease of use and flexibility over what bank networks offer. Initially, you are putting your mobile number and entering the pin and then you are tied now with your pin billing against that phone. You have a carrier relationship. In the per transaction basis, there is special account for you for other payments against that number. Mobile is different from the web. In mobile in mobile 2 clicks are one two many.
5) Boku has rules and regulations for 62 market places that they operate. It has begun to help new vertical and new merchants on how they can use mobile. One of the key values they bring, is that they enable the mobile operators to issue credit. Quite often work with resellers and then to those other resellers and other with single APIs.
6) Some discussion on Carrier billing: It is only 9 dollars that you can bill and then you limit and so the carriers have to offer credit. (Probably regulation on micro payment)

Premium SMS examples by Peter Garside:

7) Talking about wap billing and premium sms; We are educating the society and verticals on what are the other ways of using the payment
8) Some of the stuff that we have been doing is a voucher for ice creams in Scandinavia. Send the voucher through sms. Buy a bus ticket, train ticket. Billing is premium sms. Other project include one in retail in the UK you could go to a retailer you can check if they have got stock. Loads of new way wherein you are using premium SMS
9) Wap billing is fundamental. What important is the application of technology and education of the market. Payment points are inconsequential. Fulfillment through the device is important. Price payments of 10 quids or below qualify as micro payment- Under 10 dolllar or 10 pounds (regulatory)
Others
10) How do you engage with the consumer at the point of decision. It doesn’t matter what is the cost of the item.
11) Classified advertising on eBay is an example of incremental revenue through mobile as a payment instrument. Similarly for the whole range of vertical markets- Online gaming, ticketing. Vodafone has the pizza hut service. Vodafone has offered new capability wherein you can get incremental revenue from customer position (location).
12) How does it appear on the customer bill?
a. Two models:
i. Reseller model: Selling content is operator responsibility. You are selling and show your sales of the ticket
b. Payment mediation model
i. Your part of revenue share in payment mediation model
13) Content services like rbt go into payment mediation model. These models are valid for all mobile content and all physical goods. There is no split as per vertical.
14) Operator in Europe are going through payment mediation model. Payment mediation charge for RBT is 30% and 7% for a movie ticket. You charge this amount as the convenience charge that you charge for the system.
15) Should the operators become a bank? China mobile bought a bank.
16) Premium SMS with apps: Mobile SDK project. Can embed and do one click payment. Its not really into apps tore. Give the developer new way to monetize.
17) In car devices, have meta data libraries and mobile payments may be an easier

Mobile Entertainment Market 2010, Meffys, Event summary and detailed discussions: Part 1

Telecom

hatankar

-

July 6, 2010

0

Mobile Entertainment Market 2010, Meffys, Event summary and detailed discussions: Part 1

Meffys 2010 awards and Mobile Entertainment Market (MEM) 2010 organized by Mobile Entertainment Forum between June 21 and 23 in London, was definitively a confluence of leaders and champions from every stream of mobile and entertainment business globally. The event saw participants and speakers from traditional vendors such as Nokia and Ericsson, applications, internet and social networking players such as Microsoft, Flirtomatic, Sonico and Yahoo, Media companies such as Buongiorno, Saffron digital, and Gracenote, Handset manufacturers such as HTC, Blackberry and Sony Ericsson, Operators such as Vodafone, O2, T Mobile, MTS, Turkcell and Azercell, broadcasting and television companies such as BBC, Sky and HBO, payment companies such as Boku, mBlox and Ericsson, Video product and services companies such as Sling Media, publishers such as Random House, Mobile advertisement firms such as Admob, Consulting firms such as Accenture, KPMG and 4th screen advertising, Entertainment firms such as ZED and Hungama Mobile, Sports Clubs such as Real Madrid, filmmakers such as Disney, Music companies such as Shazam, Spotify, Sony, 24-7, Omnifone and Dada, Mobile marketing companies such as WPP, ImpactMobile and 2ergo, augmented reality players such as Layar, regulators such as phone pay plus and App stores such as Getjar.
The hottest topic of the three days was apps and most of the discussions touched or revolved around app stores and apps. Understandably, Google and Apple were absent and conspicuous.
The article below attempts to summarize the key takeaway from all the panel debates and keynote that occurred during the meet. Detailed notes can be found attached.

Keynote by Andrew Budd
Andrew walked the audience through a decade of progress in mobile entertainment. He touched upon ring tones and called 2004 the year of ringtones which became ~$15B industry by 2006. He called 2005 the year of snake which was the core of mobile until ring tone came when the entertainment shifted from games. Today according to him ~40% of the app store revenue comes from games. After games, came ring tones and crazy frog. Experts believe that the subscription model on the ringtone killed the business and took the innocence away from the service. 2006-2007 was the launch of the mobile video, however, the user experience wasn’t good enough so it didn’t work. 2007 was really the year of WAP, when the mobile internet got its own definition, with its own technology and constraints. WAP is the basis of operator portals. 2008 was the year of social networking and premium SMS to facebook and twitter. Social networking became the killer app. Andrew said that anything that has a social context is 10 times more valuable. 2009 became the year of apps when Dr. Antero Taivalsaari (SUN), and Mark Vandenbrink (Motorola), who created J2ME were awarded the innovation award at Meffys. In 2009 app stores became the new content category after 10 years of J2ME. Today, 2010 is the era of touch phones with PCT technology, invented by Dr. Andrew Hsu of Synaptics, which changed the concept of the user interface. The technology enables to create large flash objects, without distorting resolution and which is a pleasure to use. Andrews list of next ten years includes:

Flexible materials and form factors

1) Feature films, 3D and AR
2) True multi-channel
3) Mobile as the media center of our lives
4) New business models
5) More growth

The next session was:

What Have We Learned and Where Are We Headed?

The session was moderated by Andrew Budd and had following panelists:

Vesa-Matti Paananen, Mobile Communications Business, Consumer & Online, Microsoft . He is the inventor of ringtone
Fernando Gonzales Mesones, Head of B2C, Buongiorno
Alan Brenner: SVP blackberry

The key ideas discussed in the panel discussion were:
1. Keep things simple
2. Content and service is king
3. Personalization of mobile is key. Even if the ringtone was a global phenomenon, but the type of music and content was different. The ringtone is just a part of personalization. Apps are new ways of acquiring content
4. New products have to be pushed with a lot of marketing dollars. (Operators) They do something and then they don’t market. Operators also have to learn to do things from 10 to 1 year for production. Closed market is not where they should go and blocking will not work. Openness without commercial gatekeepers (implying google and apple) is the way to go
5. New combinations of value will emerge from Open platforms and then how they are integrated
6. Way forward is providing the right content at the right time at a convenient and right price in an open system, with simplicity, to provide a combination of value and price.
7. Games are key and social content is more and more important
8. Michael Bornhauser Managing partner 5 continents consulting group believed that there are too many apps and search on app is the killer app
9. Apps are to be linked with the media companies to create branded apps so that they became someplace consumer know
10. The other question you have to ask what is the future reference device- iPhone, Android or tablet

The next session was

Publishing and the digital future

by Fionnula Duggan Director at Random House digital group. Fionnula, was VP at EMI earlier and knows the music business quite well. The key ideas that Fionnual shared are:

1. E-book sales as % of US trade book sales is ~4 %. In 2010 e-books saw a growth of 7-10%. In 5 years industry forecasts a growth of 5-25%. This is the very early stage of hockey stick growth
2. There are three pivotal moments in the ebook industry:

a) Amazon Kindle launched in November 2007 – dedicated device catering to millions
b) App store and iPhone launched in July 2008 and iPad and iBookstore launched in April 2010– smartphones and tablets catering to tens of millions
c) Google editions – the web catering to billions

3. Amazon Kindle: Interaction of a user affects their pleasure and the immersion in reading is such that the device is disappearing. Kindle also offers seamless wireless retailing and its ecosystem, has 80% of US consumer e-book market.
4. Nigella Quick collection apps which became a hit after the launch is a case study for App store and iPhone / iTouch. With this app for recipes, you can connect to facebook, make recipes a part of the shopping list, you can Turn on the voice activation for forward and back while you are cooking. It has become a Lifestyle app and is priced just at 4.99 pounds. There is an iPhone app soon to be launched for digital books.
5. Google Editions – is not yet launched In the web- 70% of e-book reading is happening on PC. That’s where Google will make money. Streamed viewing of a book on the cloud over multiple devices is what Google is attempting to do.
6. Books and digital books will co-exist. In some places, digital books uptake will be faster. Uptake with academics could be faster for example.
7. Piracy, commercial model, and role of the publisher are a few threats
8. Opportunities
a) Share of reading in devices increases
b) Work through retailers
c) Can be broken down and consumed
d) Can digitize products early
e) In Amazon and apple world people are used to paying. Work early on with these people. The book industry is a lot more organized than the music industry
f) Social networking: Many people buy because people recommended. Work with communities and not resist
g) Subscription based models will replace the libraries is where we are heading to. Are publications talking to each other like the music label? People will replace their book collections like the music collections, If you have the confidence that you will get what you wanted (Google edition model)
9. While the book industry may be similar to music there are differences: They have different demographic to music. Books are more female oriented. It’s not just about 22-year-old guys trying to crack through DRM. Besides these are very different time. Book industry will evolve very differently from music. In the books industry market segmentation is important. The pricing in the industry is set by the retailer.

The next panel debate was

The Apps Explosion: What Does the Proliferation of Apps and App Stores Mean for the Traditional Content and Media Industry and How Must Their Strategies Adapt?

The panelists were:

Sarah Evans, Head of Mobile Internet and Portals, O2 UK
Mark Linder, Global Client Leader, WPP
Philip Blair, Product Director, HTC
Tim Raby, Managing Director, OMTP
Oded Ran, Head of Mobile Services, UK, Microsoft

1. Oded Ran from Microsoft said that it’s very difficult to ignore big platforms. The question is what you are trying to achieve. If you have a limited budget and you don’t have content it’s a very tough business model. You have to pay for development and then buy content and then monetize that. You have to get the billing right. The content itself is difficult to charge for an experience itself has more value. If a content app can be wrapped in a mobile experience then you can charge that and sort out the billing
2. What is Wholesale application community: It’s a collaboration between 25-28 operators for the developer ecosystem to get the developers apps to the multiple operators.
3. Japan is a good example of web mobile commerce. In terms of micropayment and microtransaction over the phone.
4. Philip Blair from HTC said that Advertising is a contentious topic. It has to be linked to the core experience. Location-based have great opportunities to monetize. Mobile is very personal so advertising becomes tricky. Flirtomatic monetization model was: Flirtomatic service is free but you charge for premium services. For example, Women don’t like anything negative on their profile so they charge to delete that. Virtual things like bouquet are more valuable for women so they avail themselves of premium services
5. It is extremely costly to develop app apart from blackberry or iPhone.
Handset fragmentation:
6. Microsoft is coming up with a set of tools for windows 7. Windows 7 also is tying up with the operators.
7. HTC: There is a limit to what the industry can do without standards. Standards would make a difference.
8. Innovation is necessary over and above content e.g. doodle jump, four square
Are mobile web apps second-class citizens to client-based apps?

9. Definitely not if the web apps are delivering in a much more compelling way and are providing if the experience is the same. Do it in a way that it is compelling. Tim believed that Client has a certain value and a small number of high-value ones will be client based and rest will be just browser-based. WAC’s vision is that downloadable applications will be on web service that can be used on every OS and handset, creating a multiple operator controlled ecosystem.