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The mobile phone is drawing the Internet onto its small screen and turning into a tool that offers more than calls and SMS..

Internet in your pocket.
Internet in your pocket.

Multi-tasking is the operative word here with a camera, computer and music player all packed into the hand-held.

Swetha Kannan

Rajeev Kumar is a true inhabitant of the wired world. Right from the moment he wakes up to the time his head hits the bed — whether it is to make last-minute changes to the client presentation or catch up with friends on Facebook, to check the latest cricket score or listen to some foot-thumping music — Rajeev's world starts and ends with his Blackberry.

While this raises the issue of how a seemingly innocuous looking gadget is quietly taking control, there's no escaping the fact that the mobile phone is touching our lives in ways unimaginable.

No more just a voice device

As mobile telephony grows rapidly, users are increasingly seeking to do more with their mobile devices than just call. The SMS too is passé today, with the mobile phone being put to more uses than before. Multi-tasking is the operative word here with a camera, computer and music player all packed into the hand-held.

From downloading software to games, entertainment to accessing content across genres, mobile users are looking for new ways to personalise their handsets with utilities and multimedia content that make their mobile experience richer. Even plain vanilla phones today offer innumerable possibilities to the user. All you need is a GPRS connection and an Internet plan, and you have the world under your fingertips literally (Never mind the painfully slow and snapping networks!)

India will be the third largest Internet user base by 2013 after China and the US, says Forrester. And nearly 10 per cent of Internet users in India access the Web from their mobile devices and this number is fast increasing.

The advantage of the mobile medium over PC is the large mobile consumer base coupled with the infrastructure that already exists to enable the take-off, says Arun Tadanki, Managing Director, Yahoo! India.

On the other hand, the growth of Internet on PCs depends on wired infrastructure or new developments such as WiMax. PC Internet infrastructure may take several years to match the widespread wireless mobile infrastructure that exists today, he adds.

“With fixed broadband penetration still low in the Indian market, portable broadband is catching the attention of consumers on the move very rapidly,” says M.A. Madhusudan, Chief Executive Officer, Virgin Mobile India. Globally, according to Gartner, by 2013, mobile devices will overtake PCs as the most common Web access device worldwide. Says Tadanki: “We believe that in just about two to three years, the mobile Internet user base could outstrip PC Internet user base. We are seeing very strong growth in numbers both in terms of unique users and engagement on theplatform.”

Smart and data-rich phones

Falling prices of handsets that are capable of rich data experience could soon make the mobile phone a primary form of accessing the Internet. Says Alok Goel, Product Manager - Mobile, Google India, said: “2009 was the year of cheaper and innovative data plans and mobile Internet. With data plans charging a flat fee for doing anything the consumers want to do, the fear of how they will be charged for Internet usage was gone. 2010 will bring in a big economy around smart-phones. And more smart-phones will only mean more Internet usage.”

Around 17 per cent of mobile device subscribers now own smart-phones, up from 11 per cent in end-2008 and 7 per cent at the end of 2007.

Entertainment all the way

So, what is it that users are doing on the Internet using the mobile? Just about everything they can on the PC — right from news, to search, to scores to music. Entertainment-led content rules the roost among Indian mobile users. While mobile music is a big revenue grosser, there is a growing demand for entertainment such as mobile TV and video services as well as location-based service. User generated content, social networking, financial services, mobile payments and mobile banking are also finding favour among mobile users. Cricket properties also enjoy popularity among users on the go looking to catch up with the latest scores. New applications such as video TV, mobile conferencing, full motion videos and multiplayer gaming are also becoming popular. It is believed that 80 per cent of mobile Internet usage is based on search, statistics that makes search leader Google very happy.

“Google mobile usage (Google applications and sites) saw a 4x growth in 2009 over 2008,” says Goel.

Social networking sites are also a huge market for mobile Internet. The incidence of Web access through the mobile phone has grown explosively in 2009 over 2008, according to a study. “People accessing Facebook via both the computer and mobile are twice more engaged with Facebook than users accessing Facebook only via Web.

In countries such as Indonesia, South Africa and Kenya, more than 60 per cent of our users access Facebook from the Web and mobile devices. We expect that very soon more than 50 per cent of our users in India will also be using both Facebook on the Web and mobile,” says Henri Moissinac, Director of mobile, Facebook.

Some of these Internet properties have been specifically designed for the mobile phone. For instance, Google has a range of offerings on the mobile platform such as image search, voice search, maps, driving directions based on landmarks and Latitude (that lets users share their locations). Incidentally, some of these applications have been driven out of India.

There are also products that have also been specifically developed for the Indian Market. Yahoo! Cricket on the mobile is a classic example. “Our focus is to bring the best mobile experiences we offer globally (such as Yahoo! Messenger on Blackberry) along with India-specific solutions such as Yahoo! Cricket for mobile. We are also building applications on new platforms with handset manufacturers and service providers,” says Tadanki.

With mobile Internet here to stay, the thrust in on enhancing user experience. Application Stores are thus fast becoming the new solution market that promises the development of a new revenue stream for operators, handset OEMs and application developers.

While Airtel already offers app stores, Reliance and Aircel have also expressed desire to start app stores soon in India. “We feel the mobile applications industry is at the cusp of its development and the future will only see the mobile application industry maturing,” says Vineet Taneja, Director-Marketing, Nokia, whose Ovi Store has seen huge consumption from India.

“India, in fact, is already among the top five countries in terms of number of downloads for content from Nokia's proprietary Ovi Store.”

It's money too!

Mobile Internet is fast becoming a revenue model for operators. Revenue from mobile value-added services (VAS) accounts for 20 per cent of an operator's revenue — this has seen a two-fold increase since 2006. “Mobile Internet has a good share in the overall VAS market. Like any other telecom operator, we are leveraging mobile Internet on VAS as one of the key revenue drivers. Hence, we have the highest data penetration in the industry with up to 20 per cent customers every month,” says Virgin's Madhusudan.

While convenient usage models such as mobile Internet recharge vouchers and electronic recharge platforms are making it easy for consumers to embrace mobile Internet, they are also helping companies make some extra money.

Companies such as Airtel have already started to benefit from these innovative models, says Praveen Bhadada, Engagement Manager, Zinnov Management Consulting. “And BSNL, the first company to launch 3G services in India, offers 3.5 MBPS speed on the network and charges 1 paise/10kp of downloads, making it affordable for the end users. BSNL has been able to get 7,50,000 subscribers for its 3G service so far and is aggressive on expanding its reach from 300 cities currently to 700 cities by end of this year.”

But no matter what the numbers seem to suggest, all is not hunky-dory. Infrastructure and connectivity still remain the crux of the issue. Despite a chunk of the surfing population embracing the mobile device, the experience is far from satisfactory. Mobile Internet penetration in India is still in its nascent stages compared with mature markets.

Slow data download, low surfing speeds and low-end handsets supporting mobile Internet are some constraints hindering penetration of mobile Net in India.

While the handset problem is slowly being addressed by the increased availability of affordable smart phones, the infrastructure in the country does not quite match up to the needs of users.

Says Andrew Rowsell-Jones, Vice-President and Research Director, Gartner, “There are 400 million handsets in India. However, on the flip side, when we see GPRS vs 3G, the user experience is less enjoyable in GPRS network. This may slow down adoption of mobile Internet.”

The real ramp-up will happen only when 3G becomes a widespread reality. 3G technology will bring in high data transfer rates over longer distances, efficient bandwidth use, map and positioning services and multiplayer gaming.

It will also enable high-resolution video and multimedia services with audio streaming and video capabilities on the move. And industry players are geared up for that day. “We expect to promote rich content applications around videos and mobile Internet a lot more with the advent of 3G,” says Madhusudan of Virgin Mobile.

Consumer India eagerly awaits the catalyst for change. A massive change.

swethak@thehindu.co.in

Related Stories:
Small screen for big play
Move over, SMS
Your PC on your mobile phone

(This article was published in the Business Line print edition dated March 15, 2010)
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