Wi-Fi Google’s Googly?

There are credible predictions (Om Malik, Tom Evslin) going around that GOOGLENET will expand nationally in the US. However, there seems to be strong denial from the company itself on its intent to do so.

This is a brief history of this partnership:
1. Started as a sponsorship of a Square in San Fransisco
2. Extended to a Park in New York City
3. Extended to the Mountain View area of California. (Google’s Campus Area)
4. Completely unwiring San Fransisco

The disruption in this evolution started with the Municipal Wi-Fi Access at Mountain View. The Mountain View municipal Wi-Fi Access provides 1 MB/Sec. What is the story going further? I should think:

5. Expand Sporadically (Campuses & Townships, Squares, Software Parks)
6. Have Location Based Advertising Solutions? Google has filed a patent.
7. Partnerships: Allow “unprotected” last mile- Drive user numbers
8. Allow non-traditional players like Sony and Nintendo to use the network.

What is the fundamental difference in this approach to Wi-Fi networks?

I am not monetzing the network as much directly as a connectivity service but rather serve the user without charge but drive custom services and content. The wireless access point directs all traffic to Google through a VPN, process the information and insert the correct ads back to the end user. The patent allows that a Web browser's appearance could also be altered to display logos or other brand information associated with the wireless access provider. It also notes that customers would be asked to agree to receive the ads in exchange for free wireless access.
This is Google’s Wi-Fi Play.

What is the Googly for India?

Googly (Wikipedia):
In cricket, a googly is a type of delivery bowled by a leg spin bowler. In Australia it is commonly referred to as a wrong'un. A googly may also be achieved by bowling the ball as a conventional leg break, but spinning the ball further with the fingers just before it is released. Less skilled batsmen, or ones who have lost their concentration, can be deceived completely, expecting the ball to move one direction off the pitch, only for it to move the other direction. It is used infrequently, because its effectiveness comes mostly from its surprise value

With 500 million people below the age of 24 and increasing education, growing disposable incomes, India is a very good market to adapt this model. This particularly makes sense because the networks in question are being built today. I’d expect unwiring of specific cities along with wiring. Unwiring of Cities like Pune, Hyderabad and Bangalore completely through funding by IT companies and Technology companies. Intel has recently announced its plans to unwire Pune. I’d expect unwiring of select areas of Delhi and Mumbai, though that would be through the hotspot model. Smaller townships and industrial towns (Bhilai, Bokaro, Jamshedpur, and Special Economic Zones) would again be unwired by respective municipalities / zone administrators)

With its presence in Bangalore and Hyderabad, I would not be surprised if Google takes on the onus of the network funding for specific zones or for each one of the entire cities. It is also the onus of the service providers to seek such partnerships and build them now. It is the small step preceding what might be a Giant Leap.

A completely free Access may not justify the economics in India. However a series of content partnerships, Ad revenues may subsidise, in part, the subscription charges and boost the broadband revolution at the retail consumer level that is yet to take off in India. After all, Intel’s stake in unwiring of Pune is also to drive the penetration of their hardware through PC’s and Laptop’s in India.

We will need to closely watch this Municipality / Free Wi-Fi Model evolve in India. Does it mean it will begin to justify to the network operator the low Network Cost/ ARPU ratio in India?

Are the builders of networks ready for this Googly?

Ravikiran Ravulaparthi

Why wouldn't this work in India?

A new SIM card that can work with two separate Mobile numbers, enabling customers to have their work and personal numbers on the same SIM card.

I would love this service. This could also enable Corporates to pay for official calls and the individual for his personal calls.

Perhaps this is some way Tata / Reliance could churn high end customers?

WhyMax (?) in India – I: Introduction

The Promise: Of wireless data speeds of up to 40 Mbit/s over a distance of 10 km using relatively inexpensive equipment. Other relevant parameters are scale and the time of commercial availability of this technology. The timing of the emergence of WiMAX seems perfect for India’s Broadband Vision for 2010. However, Device Cost is a major factor at consumer-end, the spectrum allocation on the policy-end and the cost of capacity at the operator-end of the industry. Until a solution resonates with these three factors, WiMAX is a means without an end for India.

Spectrum: The three frequencies for the initial equipment are 2.5 GHz, 3.5 GHz and 5 GHz.
The allocation of spectrum in India should be Technology neutral under the generally defined policy guidelines. The policy and evolution of regulation is unclear in India. This should follow the “General Statement–Discussion-Consultation Paper- Consultation Process -Written Directive” path.

Any reader with an insights/ views on regulation of BWA in India may please comment.

WiMAX Networks: Relationship between 3G Networks, WLAN and WiMAX
The true emergence of 3G networks in India and the investments required in these technologies from operators may come up and about just prior to the emergence of commercially viable Wimax technologies. The investment decision therefore is an important one. While it is easily digestible that WLAN and WiMAX are complementary to each other, I am not fully convinced of the relationship of a future WiMAX Network vis-a-vis a 3G network.

WiMAX and Rural Connectivity: WiMAX equipment could play a key role in providing long-range fixed-wireless connectivity in rural and remote areas.
It is generally understood that the cost structure of the WiMax network and the population spread in rural areas make them an ideal technology-market combination. If this is true the recent announcement of Reliance on Village Kiosks and the existing Tata Indicom Village / Public Telephone (VPT) initiatives are very crucial in the long run to exploit reach and synergies.

Regulation of Interconnect: WiMAX Operators and Others
Considering the existing situation in India – existing operators who will invest in this technology. The regulation is likely to evolve around this assumption with each operator trying to swing the regulation in their favour. Considering how regulation has evolved on various related topics such as ISP licence, Net Telephony, Grey Traffic etc. a direction to how regulation may evolve is not clear to me. Hopefully, by the time WiMax networks become a reality (if they do) all artificial barriers and boundaries created by regulation on Interconnect etc. will vanish or become insignificant.

Privacy and Security: Concerns and Opportunities
WiMAX could have typical privacy and security concerns that a disruptive technology that brings about a significant change in range, coverage and speed is expected to cause.
However in India security is at a nascent stage and therefore this provides an opportunity for Intermediaries and Vendors. Service providers will expect complete solutions from the equipment vendors who are likely to partner with some niche security players to provide embedded security in the equipment (as in the case of Wi-Fi equipment).
For value added security services and managed security services the Service provider is likely to charge a premium and share the revenue pie with the partners in the value chain.
Privacy and Safety of these networks is a likely concern especially with the ability to transmit video as well as is evident in the case of MMS which is currently affecting the nascent MMS market in India. The lack of clarity of regulation here is a concern – the arrest of CEO of Baazee (an Ebay like service) over trade of illegal content is a case in point.

Regulation: Universal Service
WiMAX will definitely affect the need for wireline networks in remote areas. Therefore it will spark the debate for the need to Universal Service funds to WiMAX networks as well. Broadband Wireless Access technologies may eliminate the need to fund infeasible Wireline networks in remote areas. In other words, it will add to the current complexity in allocation of funds from the collected corpus for providing Universal Access.

Planned Future Posts
I will attempt to put detailed posts on the following specific topics that one needs to explore in greater depth to come up with a meaningful and comprehensive understanding of the WiMax in India. All inputs are welcome.

WhyMAX(?) in India – II: Value Proposition
WhyMAX(?) in India – III: WiMAX Vs Other Technologies
WhyMAX(?) in India – IV: WiMAX Regulation / Policy

Inspired by the link to OECD paper on WiMAX on gigaom.com pointed by Ranga!

Decisions! Decisions!

The World is looking at the Indian Market. Vodafone has a stake in Bharti. Private Equity players investing in Indian Telecom market have made four-digit-percentage returns here. Telecom is one of the newest sectors to get liberalized and is at a rapid growth stage of the lifecycle. I believe that the domestic telecom market in India still has the capacity to grow manifold.

Global Pangs
The domestic markets give the Indian Telecom companies the scale and the size to look beyond the borders, particularly in the long haul market. Note the acquisitions of Tyco Global Network, Flag and Teleglobe by Indian Companies. These are networks built for the world for India to operate. Can Indian Companies leverage their strength in the IT space and provide world class ICT solutions, may be services to start with, to the world?

Dancing Links in the Value Chain
The presence of players across various segments of the Telecom value chain brings about new challenges in the Indian Market. The market play of various companies in this space is changing spectacularly thanks to continuous regulatory changes and rapid market growth. Many segments of the market in India are unstructured and unorganized, particularly in the media and entertainment space and its overlap with the digitizing communication industry.

Policy
Managing the regulatory changes in the country is a key to success in this market. Not a week passes in the Telecom industry space in the country without hurried meetings to discuss the impact of fresh regulatory changes. This sets forth a new set of decisions for those at the helm of Telcos and arguably the most important aspect of business in Telecom in India.

In this context, there are a few paradigms that the business leaders face in this market, there are no ready made solutions to these challenges. The following is an illustration: the problem atypical and the solution not repeatable–

Retail Mass market versus the Enterprises
Bottom-of-the-Pyramid versus Top-of-the-World
The new age Indian enterprise wants the latest solution, particularly the IT and BPO sectors. They want the best in class solutions to their communication needs. This implies that the Telco needs to invest – invest in new technologies, invest in Nest-Generation, invest in Convergence. The scale for such investments is justified when the retail customer is willing to pay for the services that it can offer. Here we run into a mammoth challenge. The Indian mass market has the most skewed figures for ratios such as device cost / ARPU, Device Costs/ GDP per Capita, and therefore you see the difficulty that operators run into by bundling the handset with a mobile phone connection etc. The recovery cycles can be very long and unprofitable. This is also the reason for the low device penetration (examples – PC’s, set top boxes)
The enterprise customers pull in one direction – towards investment, and the retail customers towards lower tariffs, customized devices. It is a top-of-the-world-solutions battle versus bottom-of-the-pyramid-offers. In this context, some decisions (product reach versus solution range) can be very complex:

1. When is it appropriate to start investing in and building IP centric NGNs?
2. Is this right time to roll out a 3G network? What is the scale of the rollout?

It is certain that the market and the customer should be at the center of all decisions. It is imperative that all players in the value chain, the device manufacturers, the software vendors, the network equipment vendors from across the globe understand the market and its challenges.They need to Solve Local!

Exciting Market. Challenging questions. Important Decisions
The times they are a changin’ and there are no answers blowing in the wind!

Three Axes of Convergence

"Nature uses the longest threads to weave her patterns, such that the smallest piece of the fabric reveals the organization of the entire tapestry." Richard P.Feynman

Thread 1: Advaita – philosophy of monoism propagated by ancient Hindu scholars. Literally stands for non-dualism. When asked why duality is perceived in this world, advaita has a multi-pronged answer to the question. Metaphorically, referring to the rope trick - this is akin to the false perception of a snake in a rope. When the rope is known, the snake vanishes. Similarly, on realization, the world of multiplicity vanishes. Vanishing of multiplicity in our real world is "Convergence", really the biggest buzzword in the communications industry. The eventual monoism and disruption of a few industries is being enabled through technology today.

Thread 2: Three axes – The non-dual view of three industries is quietly being driven by technology today. My view – the axes on which the communications industry can map its convergence with three other industries are:
1.Information Technology – forming the ICT segment.
2.Publishing, Media and Entertainment – Provision and user-centricity
3.Financial Services – the e-commerce and m-commerce world
Strategists can map the Telco (Communications Company) of the future on these three axes.

Thread 3: ICT – The Information, Communications and Technology space is increasingly gathering momentum with the world tending to the IP-centric world. The artificial barriers created by the bell-heads and the world with boundaries of trade in general are being decimated by technology. The battle between the connectivity owners and the software creators may ultimately result in creation of working partnerships to share value. Enterprises in a globalised world (Flat is the word) will drive the convergence in this space before it spreads to the retail markets. Microsoft, Google, Ebay, IBM and others will be equal partners in this space along with the likes of AT&T, Global Crossing, VSNL on one hand and the likes of Cisco, Nokia, Ericsson, Intel and Lucent on the other. There are no two cakes here anymore. They will all share the same piece of a single pie from business and enterprises.

Thread 4: Publishing, Media and Entertainment– These three landscapes are changing rapidly. Even as the seconds tick, there is innovation in this change. Some of these innovations may turn out to be quite disruptive. Digitization and User generation of content are the biggest drivers of change in the publishing world. The % of paper, tape and film based content versus digital content in our lives has reversed. The % of user generated content is rapidly increasing too. Ubiquitous broadband networks are the policy goals of many regulators and governments worldwide. With the digitization of networks, particularly the traditional media networks, with emergence of mobile broadcasting standards, techniques and devices, there is bound to be disruption and enormous shake-out in the value chain in this space. IPR protection and Content Distribution are the key drivers for sharing of value in this space. Content creators (Disney), Content Protectors and Deliverers (Microsoft) and Content Distributors (phone and broadband companies, Telcos) will battle out for their share of the pie in this space. Meanwhile users will reduce the mind-share of content creators through their own content.

Thread 5: Financial Services and Communication – The convergence in this space may not be as evident as it is in the ICT and Media space. The more embedded these services become in the network and the application layer the more communications companies play a part in this space. Today communication companies are working with the financial services companies as enablers, as partners down the value chain. As the depth of penetration of these services into devices and networks increases the communications company may be able to extract a greater portion of the value than it is managing today. The gateways to transactions of the future may provide the Telco with a significant share of the value. Unlike the ICT story, the major value in this space is not driven by enterprises that have centralized and wired transactions already, but the retail mass market. NTT Dococmo and KDDI (Japan in general) seem to point the way in the future in this space with their m-wallet product launches. Credit card companies, banks (Retail Financial Services) companies in general see advaita in action with mobile service providers.

Thread 6: Journey, not Destination – The transition from multiplicity to monoism is going to create multiple but small windows of opportunity in these business spaces. The challenge for industry, Telcos and businesses is to remain agile enough to milk these opportunities and move on. Agility may be the greatest need for existing communications companies to survive these shakeouts,changes.

Ravikiran Ravulaparthi

Beginning of a Circle

For a few months now this has been on my To-Do list. While creating a medium to post my musings on the fast changing (Tele)-Communications industry, of which, I would like to be a part, at least for now, I have been waiting to improve my understanding and that gentle nudge to go ahead with this initiative.

This "communications" space is really exciting, the Internet and the Telecommunications sector driving fundamental change. India is at the beginning of this revolution. As I go, I will probably post things here on this industry both strategically and philosophically.

I need to put a strict disclaimer here: These are my personal views.

I made this modest beginning last week, by trying to design a logo for Telecom circles. The trigger of course was my "chance-visit" to Word of Blog, and that gave me an inkling of what the future of advertising might look like.

I have been motivated by the weblogs of a few "maharathis" (Sanskrit for "seasoned warriors") in:
Tom Evslin on Fractals of Change
A VC on AVC
On Malik on Gigaom
Feld on Feld Thoughts
A concept on 800ceoread
I will read, learn and reflect on articles in these blogs as well. This is the beginning of this circle.

My grandparents only world view was through vernacular press in their village in India. My parents lived in the age of Television, expensive telephony and are now seeing low cost wireless mobile telephones change their lifestyle. My mother has a Telegu ring-tone on her mobile! She was a technophobe not so long ago. I myself accessed my first email in the IIT campus barely seven years ago. Today it is an integral part of my life. I cannot cease to wonder the state of the world seven years hence (and fourteen!)

I will keep posting my thoughts on communications space, make mistakes, learn from discussions through this medium. Looking forward to a lifetime of communication!

I have made a beginning by creating a short ad for Telecom circles, with the logo,
here it is:

Heard the Word of Blog?

I think this form of advertisement is going to change the ad-world in as few as five years. Let me know what you think.

Ravikiran Ravulaparthi

Find news and musings on the Telecom industry here

Watch this space for more!