Dis-incentivising Prostitution

From a brief scan across all the proposals and demands from the industry one gets a feeling that government is out to dis-incentivise their particular industry and government is doing a damn good job of this. But look at prostitution, the world's oldest business. Many a government has tried to ban prostitution (dis-incentivising of course) to no avail. The worst affected by the ban were the prostitutes. They were exploited by various people starting from pimps to law enforcement agencies. And still there is no end to prostitution. Hence many governments have taken steps to legalise the system. Can then the government learn from its exceptional good job in other industries and use it where it matters most?

The Horns of the Devil!

If we observe this business we understand that there are three core players, prostitutes, pimps and customers. Prostitutes are the exploited ones, they are there (in most cases) because they do not have alternatives, they are helpless. The pimps are middlemen. But most critical element are the customers! At least in India they always try and catch and prosecute the "prostitutes" but customers are often let free. It the customers you have to catch if you want to eliminate prostitution!!

How do you do it?

The first way government can di-incentivise this trade is by taxing it! Simply take the details of the customers and put an additional 10% tax liability on these people. Or if I were Finance Minister I would call it a cess and channel the money into health care for these sections.

Second deals with the way British enforced law in India during their occupation. They used two major weapons. No it wasn't the baton or gun, it was information and social pressure. Lets say, if government were to take a photo and details of every person who is caught with a prostitute and publish the same on some website. Or track connected near ones like office, friends, home and supply this information across these places. Will social stigma not cause the customers' to vanish?

The Dance Bar Phenomeon

Mumbai now has another issues and its Dance Bars which government was trying to ban. The Mumbai High Court recent allowed these dance bars to operate. Using our earlier logic we can work on an effective solution to the Dance Bar problem.

First way is to simply get details of people who come to dance bars, the amounts they spend and share this information with income tax. Or simply make entry in the bar subject to swiping / scanning of PAN card! (India's equi-valent of social security number for tax purposes)

Second again will be to share the details with the friends and near ones along with details being publicly posted on some common website. Regulars should be tracked and traced across dance bars.

In sum...

Basic economic sense can be used to contain a lot of industries, often these techniques are used on legitimate industries in era of control. Same techniques may be deployed where it actually matters. What Say??

Inorganic Growth and Organisations' Risk taking ability

As students of business we understand that organisations can be classified into three types based on their growth strategy. Primarily organisations follow, Organic Growth, Inorganic growth and some use both. In many industries there are examples of players resorting to organic growth whereas some resorting to inorganic growth. I always wondered why is it that some companies cannot grow rapidly in organic way?

Growth Risk and Organisational culture

Risks associated with inorganic growth are well-understood and documented. In fact, it is easier to take "inorganic growth" risk rather than "organic growth" risk. Also the risk is taken by top management. Logically Inorganic growth requires risk taking ability at the top of the corporate hierarchy whereas Organic growth requires risk taking ability that is distributed across the hierarchy.

This leads us to a reasonable hypotheses about the organisation culture. Organisations that emphasise more on inorganic growth may be risk averse, explaining the association of risk with the top management. Conversely an organisation with high organic growth is almost always flamboyant, empowered down to the line functions.

Inherent disadvantages of Inorganically growing organisation

When you extend the logic a little further you realize the implications of both these strategies.

For One, a flamboyant organsiation has its ranks full with "risk-taking" experience across the hierarchy. Hence succession planning is not much difficult. Such orgaisations can find within its ranks potential leaders, CEOs etc. On the other hand in a risk averse organisation the ranks have no experience in taking risks. So effectively any modifications in the current top management shakes the very foundations of such a company.

Secondly, it is difficult for such an organisations to take-up new take-over/ merger options because it cannot find within its ranks leaders who can take up the integration work post the merger. A flamboyant organisation can effectively take up inorganic growth and thus be even more successful.

Finally, even in the middle of merger, a flamboyant organisation is more likely to energize the other organsiation, with its people taking up most of the challanging positions in the merged entity. The risk-averse organisation has to either find leaders capable of taking up this challange or resign to domination from the other organisation. (This is not a generally seen conditions because "risk averse" organisations do not take-over flamboyant organisations because of cultural issues)

Is your organisation risk averse?

How can one deduce if his/her organisation is "risk averse" or "flamboyant". Well, even though there is no track-record of inorganic or organic growth it is possible to decide where your organisation belongs. Of all people employees can definately decipher the actual behaviour from stated slogans. I believe these are some hypothese that will expose the true behaviour of your organisation. There are more and I havent thought of all of them so let me know if you think of any other.

Lets look at following hypotheses:

• Hypothesis 1: "If it aint broke dont fix it!" A performing function in a "risk averse" organisation is almost never challanged. Top management just lets them be. On the contrary, in a flamboyant organisation, a new wave of strategic initiatives is undertaken to improve the best performing function. Check in the best performing department, is it subject to improvement initiative? Are the processes in place?
• Hypothesis 2: New initiatives are always led by top management or identified leaders. A "risk averse" organisation never risks a new initiatives with unknown leaders. And this means new initiatives are all big initiatives. On the contrary, flamboyant organisations have smaller new initiatives manned across the ranks. Such organisations do not wait for "proven" "sizable" opportunity rather they explore every possible opportunity with the resources they have. List out the major opportunities your organisation has gone after? Do you see familliar faces manning them? Do you see enough grass-root level opportunity exploitation?
• Hypothesis 3: Flamboyant Organisations have a Fast-track program for employees. Typically, a team that takes higher risks needs higher rewards and this shows in the flamboyant organisation. A typical fallout of this is high person in-dependance in such organisation. The top performers are often moved across departments across functions to man the new initiatives. A fast track program may be a structured program or un-structured program but the key point is every employee knows how he can be selected for this program.
• Hypothesis 4: Meritocracy must for Risk taking organisation! Most of the Risk taking organisations have a mechanism to reward the best employees. GE consistently separates the extra-ordinary from the ordinary!
• Hypothesis 5: In flamboyant organisations, new Ideas get heard, financed and manned at first level where decision can be taken on them. If you have pitched for a new idea and your boss has referred it to his senior and you have not heard anything about it from then on, most likely you are in a "risk averse" organisation. In flamboyant organisations if someone is responsible he/she takes the decision and gets it implemented.

My new Samsung D600!

Finally I migrated from my year-and-half old Sony Ericsson K700 to Samsung D600!! Its been a well thought out decision after a lot of deliberations. I also found a website wherein you get amazing reviews of mobile phones(www.mobile-review.com)!

Yet, even after careful selection I found some drawbacks and its just the second day of using it! I guess every good thing also has a little scope for improvement!!

Migrating to D600
I found it extremely difficult to migrate my contacts from Sony Ericsson K700 to D600. I did not have the data cable for K700 did not help the matter. However, I used the Send all option from contact menu of K700 and selected via bluetooth. The D600 received the whole transmission yet only showed one contact in the address book. I eventually had to transfer all my contacts one-by-one! (I know using a computer things would have been simpler but the fact is sending entire address book did not work in D600)

Short service "SMS"
In D600, I cannot choose the default storage for SMS messages. It directly comes into SIM. There is also no option to backup the SMS into the memory card. Also try saving the number from whom you receive an SMS into one of the existing contacts. You cant do it!!! ( I usually get SMS from people saying "This is my new number" rather than getting a vcard!) Life is going to be hell!!

Where are the "Text Notes"
Thirdly, there should have been option for text notes (not those included in the calender but simple stand-alone text notes).

"Menu"s in context
The menus do not change according to context. For example, if I am typing an SMS, the left soft key shows "options" where I click to reach send. However, ideally send should have appeared as the soft key option and options should have come at the right soft key. The right soft key shows "back" which deletes the message if you are not careful.

Samsung does not believe in taking the "Short Cut"
You cannot assign all menu options to the shortcuts. The options are restricted and rest of the menu are out of bounds!!

Cannot fly without a "Flight mode"
Lastly, an executive phone that does not have a "airplane mode" or "flight mode" is hard to believe. They should have included it on D600. Of course Mobile-review team has mentioned this in their review but this is something what I call a must have!

MP3 Player, No radio!!

Where is the radio? With a phone equipped with good quality sound the lack of radio is a disappointment.

In sum...
So there it is the list of some of the drawbacks of what basically is a "potentially" great phone. There are loads of features like TV out and great camera and a lot more. I am hoping they have sorted these things out in the next edition D800 slim slider phone! For more on D600 / D800 and other mobile phones visit www.mobile-review.com!

Mobile Devices - The New Business Model

Currently almost all the "valuable" functionality of the mobile phone is derived from connecting with the network. Almost all business models are based around this central theme and already there is a lot of clutter in this space. However there is a lot of space for innovative business models to exploit inter-device interactions. The next stage of development of mobile devices will be in exploitation of the inter-device interaction.

The "Close-By" opportunity
One serious impediment for exploitation of mobile services is the lack of location tracking at close range. At the most a phone can be tracked to the nearest tower. Lets imagine if it were possible to track a phone right down to within 5-10 meters. We all know Bluetooth can enable this very effectively.

The stumbling block
First constraint is that people switch off their bluetooth communications. Can one overcome this constraint? Of course, if offers are flashed only on bluetooth then people will switch on their bluetooth.
Second is privacy. People will not welcome spam on their mobile devices. Frankly the messages one gets while roaming are extremely irritating.
Third is security. Why will I enable my bluetooth connections for others to send messages to me? Will it mean I will be exposed to Viruses or any other threats?

The Bright Idea
To avoid this advertisers need to place constraints on themselves. These could be enforced technologically too. Like for example imagine a program, a bluetooth message trasmitter server and a receiver client, that makes sure the messages are customised and welcome. How?
Imagine the "client program" has options that let me choose the products for which I want offers. The "server program" knows and only sends me those offers that I have asked for!! This "client program" can be freely distributable with mobile phones (just like our dear Adobe Acrobat). The "server program" will be bought by local advertisers (shops, malls, bus service providers etc) and telecom companies will run them. We all know that the "client Program" can be configured to be independant accepting only from "known" "server programs" thus eliminating security threats.

In sum...
I think this means my mobile experience will be much more valuable, there will be additional revenue for Telecom service providers, and local advertisers will have lower advertising cost enabling highly targetted advertising. Wont it make a better world? What Say?

Engineering Diamonds

While I am on the subject of Jewellery, let me also say a few words about diamonds. The biggest question that faces a layman like me is about the authenticity of the diamond, its material (is it really a diamond or is it polished glass!!), the cuts (apparantly more of them are better), weight in carats, flaws ( diamonds always have some of them). Not many people can look a diamond in the eye or pass light through it and tell if its a great piece or not. We all go by experts view. Is there any other way?

Optics and Diamonds

At the core of diamonds value is light or better optics. A diamond appears bright and sparkles. Also when light is passed through a diamond it forms patterns. When the diamond is manufactured they should establish what pattern it forms and share it with the consumer.

So long as the light is consistent (same frequency) and the way it is passed is consistent ( angle of incidence etc) it should produce the same pattern throughout the life of the diamond. This can be used as a metric to measure the genuine-ness of the diamond. For example, it should be possible to design or designate one particular frequency of light that shall be used for the purpose of reading patterns. Using this it is possible to create a testing equipment which can observably indicate if the diamond is of high quality or if its quality has deteriorated.

Artistic Inclinations and Observable Quality

Turning the idea around, theoritically, it is possible to design a diamond's cuts given a light pattern. Lets say a hexagon of certain dimension with bright vertices is a pattern. Now can we work back from this pattern and arrive at what design will form such a pattern? I think we can. Just that not much "engineering" thought has gone into designing of diamond patterns.

The general artisty in diamonds is currently confined to ability to design the cuts that creates the best value. Another form of artisty can be applied to diamonds and that will be pattern creation. The more complicated the pattern (and more recognisable) the more value can be derived from the diamond.

Imagine...

People can be offered diamonds that emit a pattern (under certain conditions) that says "I love you" or "Ferrari" or "Intel Inside" and even customized names like "Rahul" and the value of these diamond can appreciate far more. I am sure once this happens it wont be long when real pictures can be encoded into these diamonds so that the pattern that they form is actually a photo. And that will be the first step in making diamonds more valuable. All it needs is a few engineers putting their heads into the design departments in this industry. Dont you think so?

Engineering Jewellery

Long ago I had a look at various kinds of Jewellery designs. The designs I saw were uninspiring and dated. Considering that India is one of the biggest consumer of Gold and that too in jewellery form with a history dating thousands of years in jewellery design, this was totally unexpected. Through each of the designs I found there are only x number of patterns out there in the market. The forms of jewellery is also the same. I kept looking for innovation as the industry became more and more organised. But alas! No innovation in a product of such a high value!!! I believe the main problem is that currently the industry is dominated by artists rather than engineers.

Base of Jewellery Design

At the base of jewellery design are three basic items:

1. Designing patterns (these form the elements): This aspect is more of the artist type of work where differnet designs are created through use of symmetry, forms and look. These we will call "elements".
2. Designing links (that hold various elements together): If you observe different jewellery pieces (except the ring) you will find that various elements are meant to position themselves on the wearer's body. The links help positioning these elements and holding them together.
3. Designing Clamps or holders for gems: The element comprises of gems or diamonds(sometimes it doesn't). These gems (and diamonds) are required to be held by clamps. These are of different types crab-like or ring-like and many more.

Two paths for innovation from Engineers!

First would be bringing CAD (Computer Aided Design) to this field. I think using CAD far more imaginatively designed links can be used. In fact engineers can effectively use their design skills to make the links the focus of attention (thus morphing them into elements) or submerge them totally so that they stay invisible to the observer.

Second would have (I believe) far reaching consequences. For example, imagine a necklace that can morph from a simple necklace into an elaborate bracelet or a watch! Or imagine a necklace that you can customize with a set of jewels! This will lead to buy once and use as many!! Girls can wear one configuation each day and never will people know its just the same necklace reconfigured!

The Future of Jewellery!

Of course human infatuation with jewellery will continue! (Ok, its female infatuation for jewellery and male infatuation for females!) However, in no way has the industry even scratched the surface of innovation. The answer to me seems to lie in increasing involvement of engineers in this field.

A new way to advertise online!

Long time ago email was a big thing and to get it free I did not mind my information being shared. I also agreed to look at some ads in the bargain! Not so today! Today I have a keen sense of screen map of my favourite email programs Gmail and Yahoo! Today my eyes conveniently ignore what is flashed across the screen that is not relevant to my email!! So can you make ads better? I thought of one way!

Do you know Yahoo! gives you an option of Avtars where you design a web personality for yourself. Now can you put that in the ad? Along with flowers and Avtars of my buddies (from my contact database of course) and can you not create an on-the-fly ad that makes sense for me? Like can you not describe a flash presentation of my Avatar giving a watch (Omega, Esprit, Casio etc) to my friend's Avatar with an option of buy a gift click here!!

I think thats a good way of inducing me to click on the watch site and I might actually buy something relevant. The key will be to identify the relationship between me and my friend correctly!!! Can Yahoo! or Google do that? Sure they can scan the emails through a web-crawler-like program and figure out what ads suit best. In fact Google can call it Relationship Rank algorithm!! (Hey if you are from Google and reading this post and planning to implement this please name it Rahul Rank!!) The Ranking can be based on frequency of emails, content in emails, key word search in emails and many more parameters.

Now let me hope that they make better ads to help me enhance my relationships!!! Fine trade-off for viewing ads!!!

Happy New Year!!!

2005, by all means, was a very tough year. But nestled in the tough twigs of challanges, there were tender eggs of promises. I managed some unbelievable things in 2005:

• Lost everything in the Mumbai Floods but put it back together very soon. Rented a new place near Office cutting commuting time by solid 3 hours!!!
• Got married to my sweetheart!! Had a dream honeymoon in the hills of Sikkim!
• Won more deals than I could recollect till March! Lost more deals that I recollect but managed enough to achieve my targets till December!
• Went on a Cruise and tried to imagine myself with Captain Cook!

What an eventful year!!!! And now to top it all 2006 is here!! Here is wishing everyone a warm prosperous and cracking 2006!!!

Police Officer at every corner!!

Recently I read an passage where it was depicted that a lady calls for help and a cop arrives on the scene. I was amazed. If I call out "HELP" not one police will ever come. In fact, like in the Bollywood movies, police will only come in last.

How important is it for a developing nation to have an evolved police force. For all the power that exists in a nation is personified in that police officer. A nearly omni-present Police is greatest of crime fighters. But more importantly, it is also essential for development. (Assuming that Police are doing their duty)

I can imagine Police preventing Garages from repairing automobiles on the road, Hawkers creating new road-side stalls, Slums from coming up, People spitting on the roads, or to sum prevent abuse of public property. They would also protect small children trying to cross the roads, accompany the elderly through traffice crossings, prevent chain snatchers and in general make the environment exceptionally safe.

Eutopia is it? I am told Hong Kong already has such a thing, and Singapore too. India is far behind!! Can we say that the real roots of reforms is in police reforms. Law and Order is first step towards REAL development. What say?

Why Bihar should ensure there are no slums in Mumbai?

Slums are seen as a great blemish to any urban settlement. Various efforts made to eliminate these are rendered futile.

A slum dweller has substantially reduced cost of living as compared to a legal resident. The total cost of working for a legal resident includes rent for property, facilities like water, electricity telephone, cost of travel etc. There are also long-term expenses for maintenance of the facilities they use. For a slum dweller these cost do not include the major heads of rent and in some cases cost of travel is also reduced. The maintenance is almost as negligible as the rent. Due to these cost advantages the slum dwellers are able to work at much reduced wages as compared to the legal residents. This has cascading implications.

Firstly, this prevents any increase in the cost of labour in the city. Alternatively the labour costs may also reduce. This allows the city to retain its cost advantage over other competing areas. Corporates and revenue contributors do not feel the need to shift base to the newer areas, the newer areas do not get adequate returns on the investments. But as this is only a pseudo‑advantage it actually strains the infrastructure of the city. Investments in the infrastructure generate more jobs and more jobs attract more people. This goes into a degenerating spiral till the area cannot take any more modifications to adapt to the increasing demand.

While superficially it seems that the cost of living of only the lower end of the wage spectrum is affected, a peek at the economic mechanism reveals how this affects the entire range of incomer earners. It reduces the cost of living by making maids, drivers and other services available cheaper than it would have been possible otherwise. In its absence the pinch of increasing costs would have felt earlier creating a trigger for economically rational action.

The political impact of this is even greater. The local legal residents are not able to compete against this new workforce that enters this local markets. This forces the local labour force to move out of their “homeland” leading to “son of soil” movements. The fact that the political parties promoting the “son-of-soil” movements themselves are promoting slum rehabilitation schemes shows the hollowness of the intentions on both grounds.

The major political impact is of the vote-bank politics. The work force that migrates into the city needs a support structure and political leaders exploit this need to gain a hold in the area. The fate of the politician depends upon the number and not their legality (which can often be purchased by politicians themselves). The politicians therefore are in favour of migration into the area rather than out of it. This gives a situation the last push down the spiral out of which recovery is rather impossible.

Rational action assumed as a solution for slums is enforcement of laws against encroachment of private and public places. When this rational action assumed is broken the system fails miserably. The system needs to be redesigned so as to be fail-proof in such circumstances.

Notes and Points
Slums have an effect to lower or maintain the cost of labour in the city. This effect is short term and has a detrimental effect on the investments made in the city in the long term. Over the long term these investments are less profitable than investments in economically viable legal locations.

Artificially decreased cost of living denies the lesser developed areas to get a share in the limited investment capital available. This means Bihar and other lesser developed states should be more keen to eliminate the slums in metros and urban areas than the metros themselves.

Slum problem can be tackled politically or economically or both. Political solution would be to restrict the right to vote to locations where they have a valid house. Economically, taxation could be increased for investments in congested cities and metros. This will make investments in congested cities unviable thus allowing development in towns and cities other than those already congested. However we also need to ensure that there also a pull from other cities for such investments to come through.

There should be a great interest from the central government to make sure that congested cities do not get the investments for the greater good of the economy as a whole. Developmental bias is certain to clarify the same.

Essentially what it means is that if you ensure Law and Order (and not let slums come up in the first place) to allow the economics to shape the development you will have ideal country!! Will India create an atmosphere where Economics is able to efficiently take its course? That is a big question!!!

Low Cost Airlines

There is suddenly a spate of launches of Low-Cost Airlines in India. Each Airline claims a fare lower than the lowest. If this really continues soon Air travel will actually be cheaper than walking!! (kidding of course).

I have been thinking about how these airlines continue to survive. Recently, I read about the discussion on how Low Cost Airlines can be viable and it triggered some thoughts.

Actually to look at the viability I believe, we can look at Transport operators (cargo-trucks) model. They have the kind of Hub-&-spoke model that Dr. Krishnan is talking about. In fact the viability of the model actually lies in the hub and spoke mechanism.

For people-carriers though, there are slight problems as they have to break their journey and that consumes time. The viability of these low cost airlines must come from other revenue streams. Air-Cargo offers a good alternative.

I am not actually aware of the percentage of the revenues from Air-Cargo but I know that the local inter-city buses make a significant revenue from transport of cargo. A bus (in India) usually carries around 1-3 tons of cargo in addition to the people and their luggage. This cargo is typically mail and small goods. Similarly, I would expect Air Cargo to actually contribute significantly to the revenues. Typical Air Cargo is Mail (again!) and perishable goods. An airline based on this duel revenue model will most likely survive.

What say?

Cruising Along

Last weekend, I went for a cruise from Mumbai to Goa on Star Cruise Libra!! I will soon post some pictures of the trip but it was a life-altering experience.

Firstly, I now rate Columbus, Vasco Da Gama, Captain Cook and gang much higher. The feeling of being on a ship surrounded by water on all sides is something amazing. How on earth can some guy stand on a shore and dream about crossing the wide ocean! Ok I understand curiosity must have gotten better of discretion but what about the second time. What on earth were these people thinking when they started their second voyage! And the most important, how did these guys convince their mothers! These guys were not simply good "sailors" they were good "sellers" also!!

Secondly, there are sights seen to be believed! I was totally enthralled seeing the ship cut the water and splash it around. Watching the moon set in the sea you realize why moon is called a heavenly body! Just before the moon sets it paints the entire sea silver! Boy a site to watch! The breeze is so strong that you realize how sailboats could make their way across the world!

Thirdly, what a wonder is this Star Cruise Libra!! I am told its a 15 + year old boat! Its like a great factory, everything is impeccably right. Things (tables, racks etc) are fixed to the ground in a neat manner. The decks are cleaned every night! The wood is polished and everything is very perfect. The rescue boats are cleaned regularly and look in perfect shape! The staff is impeccably dressed. Perfection is everywhere. There is a gym, swimming pool, sauna, jogging track, basket ball court (half court), table tennis and what not! Sailors will have a complete life just like a factory worker.

Fourth, there is party atmosphere everywhere. And I believe so it must be even on cargo liners. I must say sailor life is something very organised and well planned and loads of fun! Two days definitely left me longing for more!! Maybe if I have a lot of it I will be bored, will I?

Of course there were sore points!!! The service at the restaurants leave a lot to be desired. The staff is very courteous but simple courtesy is not enough. We need GOOD food!!

I believe these people have created a problem for themselves. They have created a faulty system and they follow the system effectively. They are not empowered to circumvent the system for better results. I believe they need process consultant to work with them. Guys if you are reading this, please invest time and resources in TPM, 5S, 6 Sigma, Kaizen, Quality Circles etc. It will help you be perfect. If you want even I can help!

Advertising the "New Age"

Can you recall 10 ads that you saw on television yesterday? Ok can you recall 10 ads you saw today? No? It is reasonable to expect that I am part of the target market for a lot of companies for a lot of their products, yet I do not notice their communication on the television. As a marketer I guess its the worst problem. A 30 sec slot at prime time costs a bomb and no one notices!! Today advertising is facing it worst crisis.

There are far many number of channels today than I can care to recollect. And there are absolutely no programs that can make me watch through the commercials till the program begins again. Invariably I switch the channel and find something more interesting. I wanted to see the channels of similar profile co-ordinating the timing of the ad-spots so that even if I switch to other channel of the same profile I should see the same ad. Not so yet! I think channels should sit together and set-out rules (for say coordinating ad-spot timing)so that they can assist the marketer to reach their targets.

If you have noticed, barring Cricket and Tennis there arent many games I know of wherein you get regular breaks to show your ads. Cricket is a marketers dream there is a break every 6 balls!! I think marketers / channel owners must make a co-ordinated effort to popularize this sport. They will get more bang for their buck. But even here some channels get greedy and show only 4 balls encroaching the ad space into first and last ball. Obviously, if the viewer has an option he switches to other viewer-friendly channel.

Broadcasting Technology is changing with launch of Microsoft Windows Media Center Edition that lets you pause "live" broadcast and play it back. Soon some geek will invent a program that will "catch" the commercial and elimiate it while recording to the hard-disk. So viewers will actually prefer the media center rather than "live" broadcast!

Advertising the future!

I believe, advertisers should also look at their business and really alter the mechanics. If I draw parallels between watching a program and driving a car then ads currently are like "Red Signals". Rather effective model will be the "window shopping" model. So ads come and go they do not hinder my driving / walking but they are attractive enough to entice me to stop and have a look. the "Red Signal" approach has killed the ads ability to woo the prospect. What say advertisers?

Check-Out The "New" Mumbai Airport

How much earlier do you need to reach the Airport so that you can Check-in for your flight? Of course I know that there is Tele-checkin facility. But one has to finally check one-self in physically! And try doing that at Mumbai Airport during the morning time.

I telecheckedin a day before (some luxuries of loyalty program!). I reached the airport at 5:30am for 6.45am Mumbai Chennai flight. I waited for 10 minutes at the baggage screening counter, 15 minutes at the Check-in counter, proceeded for security check and spent 50 minutes waiting for security check and finally boarded the plane at 7.45am! I was early because rest of them took about 15 more minutes to get to the plane! And this is the new terminal at the Mumbai "International" Airport.

For more than 30 check-in counters they have 4 security check counters and 7 Boarding gates leading to one Bus pickup platform! (Thats right there are no aerobridges!!!) Now anyone will tell you that these proportions seem to be TOTALLY wrong! They did not read "The Goal!". What a shame that all this investments have yielded almost nothing!!!

So much for infrastructure!! And to think of it Mr. Prime Minister wants to make a Shanghai out of Mumbai!!!

Music to My Ears

I have always been a fan of Old Hindi Music. Except for Bryan Adams, Shania Twain, Sheryl Crow and some pop numbers my love of English songs is quite limited. Few days back, I discovered Frank Sinatra and Elvis (Can you believe I never heard them before except some remixes!)

I have found Sinatra and Elvis quite unbelievable. The songs are really good and best of all I can understand the lyrics when they sing!!! Now that reminds me, I have to go out to buy another Frank Sinatra CD! See you soon...

A long absence

Well,

I am back after juggling a job and a long distance courtship (which happily ended in marriage) I now have the "proverbial" breathing space. So many days have passed that I realise my ICE post is no longer relevant (God that industry moves fast!!) So I am chucking it and moving on to here.

currently I am tracking the blogs on IIPM after what I read about Gaurav's post. Will be back with some more ideas. So see you soon...

ICE: The Telecom / Technology story PART II

Introduction
In the last articles we had examined how some of the issues with Communication revolution are resolved. Now, will it be possible for the communication revolution to hit us as hard as had been predicted? Again I do not have the answers.

Yet, when I observe the ICE space evolving in the Indian context, I see a clear dichotomy of evolution. Service Providers are seeing great business models in the application segment. Hence they are pushing applications to the consumers. Some of the very basic applications have been a hit. “TV on the mobile” has not really taken off but downloading ring tones has been a money spinner. Consumers are accepting some and rejecting many applications. The service providers and instrument manufacturers are eager to understand what the next money spinner could be.

I believe the key to the success of new applications rests with the device. Let us look at the device in more detail.

Device
A device is a piece of equipment we use to access the bandwidth. These devices are tools for processing information, communicating tools or entertainment platforms.

Components of the device
Any component can be disaggregated into:

• Processor
• Memory / Storage
• Human Interface
• Identification
• Power unit
• Network Interface

Processor

A significant development is happening from each of the devices getting a piece of silicon in them. Things from alarm clocks to washing machines to cars to televisions everything has become “smart”.

If you look closely, you will realize that in devices where there was enough space and supply of power people have thought of putting a processor. Nanotechnology is making these chips smaller and faster and cooler (lower heat generation). This is assisting the development.

Applications can be developed for devices that have a general purpose processor with an operating system. The Application based business model will imply that environment will favour these devices. In fact, many of the applications that currently use special purpose processors (Fuel timing chips in cars) will start using this business model. But just wait before you start dreaming about the kind of possibilities.

Memory / Storage
As with the processor chips, memory chips are getting smaller. Sure, but there is a difference. Let me bring your attention to the different business models. They demonstrate the evolution discreetly.

Your Mobile Service voicemail, which is a form of storage of information, resides on the network, but your SMS messages need to be stored on your device. Have you thought why?

Well the simple answer is that Voicemail was bulkier than SMS and memory in the device was scarce so smaller size application moved to the device first. So does this mean that eventually when we have “a lot” of memory all the data will sit on our mobile phones? I guess not.

The key question one needs to ask is what happens when the bandwidth access speed becomes so fast that we can access most of the application on the fly. To answer this, look at the email. Email for most cases is stored on central servers.


What I am stating is that there are various models, the email model wherein data stays on the server, applications stay on the mobile. There is SMS model, where in the data stays with the person and the application goes to the server.

Where what is stored is decided by the bandwidth available at your disposal. Consequently, as the bandwidth increases, we might shift towards fetch as you need models.

Moving further…
The components that I am discussing below are a little far fetched. I am not sure if they will happen as there are some economic / strategic / competitive reasons for suggestions not happening. If you know any reason what are the reasons these would not happen please write to me.

I will however, continue with the series of components of the devices. The next being the human interface.

Human Interface
Human Interface is something wherein we are able to interact with the device. This is also an area where least development has taken place. The reason is just that collectively we take a lot of time to learn the new ways to interface with machines. In one sense “driving a car” is an interfacing function and so is interacting with a computer.

But beyond the weirdness, if you simply concentrate on computer – human interface, you will find discrepancies. For example, computer screen is now our primary media, yet we type documents in A4 format. Does that make the documents more readable?
Mobile phone manufacturers are telling us that we should watch television on the mobile phone screen. No one asked me am I comfortable watching it.

There are some developments worth noticing. People have put television screens in cars, behind aircraft seats and possibly wherever they could. Also the projection technology is improving substantially.

What can drastically alter the interface aspect is the internetworking of all these interface technologies. Like your laptop keyboard can be used for your mobile. And your television can show the photo you just received on your computer. We get the hint with the new software that comes with the cell phones these days that allow you to peek at the Cell phone contents thorough your computer.

So it means that we will use what ever screen we have in close proximity to us. The software that will allow for this versatility will have to hit the market. But there is a strong case for such internetworking to happen.

Sounds weird doesn’t it? But there is no reason it should not happen. And though it has already started sounding magical there is more.

Identifiers
Identifiers are those parts of devices that enable the network to know your identity. The SIM card in the mobile phone is one such identifier. On the computer there is a login-password mechanism that is used as an identifier.

As is well known the identifiers are key to security! (PUN intended) In fact a lack of developments in convenient scanners has limited the growth of the online transactions. It is primarily why Bill Gates is tracking security closely. That is why he is such a visionary.

There are two / three elements in the security environment. One is scanning the user input and second is transporting it across the bandwidth securely.

Public Key Infrastructure promises to deliver this very functionality. Coupled with a hand held reliable finger-print scanner, this will transform the way we conduct business. I think we need to watch for a day when hand held scanners can be connected with or embedded in a cell phone.

There will be a substantial discontinuity in terms of electronic transactions when that happens.

Yeas of course there is still more.

Power
Every device needs power. Mobile devices carry their power pack along with them, rest of them are plugged to the wall because of power.

Improvements in battery technology have allowed us to have longer battery life out of a smaller battery. It has allowed us to have lot of applications running on our mobile devices.

Battery has played a critical role in the number of applications the mobile device can take. The better the battery the more applications you can load on it.

Charging technology has also improved. Apple has made some progress in this area by making the iPod charge while we play the songs from it.

Yet, have you noticed that the device manufacturers do not have a standard battery packs. Each device comes with its own charger and its own socket. We cannot use a Nokia charger with Samsung Phone, or we cannot use a cell phone charger for a laptop. If these devices have interchangeable power plugs, it will mean a lot more convenience for the consumer.

When we will see a movement in that direction is God’s guess.

Summary
We have seen how the different components of the devices can change and unleash a new wave of applications. At the outset some of the thoughts may seen outrageous, but it is not that far fetched.

For example, the power units of computers are standardized across motherboards so it is not unrealistic to expect that we can have a standard for power plugs in mobile phones. These are changes that have happened and will happen sooner or later.


The way forward
In the next article I will examine what are the different kinds of functionalities that can be added into mobile phones as an example. I will propose a hypothesis that there is a convergence in devices as well in terms of components. I will also give you examples where components are added to the device to create better value and also examples where components are sold separately to create value.

Feedback
Please let me know what you think on this. Your feedback is critical and will enlighten me. And do check back again to read about the new devices and the future of ICE.

ICE: The Telecom / Technology story!

Introduction
Communication and Technology revolution has flummoxed many in the so-called "real" world. On one side, more people are comfortable in downloading ring-tones and watching movie trailers. On the other, there are others who are still wondering about what happened to the future when the refrigerator would talk to the online grocer and order groceries. In the business world the top management is scared that their ERP solution will become obsolete even as they roll it out. But will it actually happen is a question to which there is yet no answer.

I am as confused as everyone else. Yet, in the following these are a series of articles detailing some aspects of these issues that may provide an answer. I have read some literature on these issues from various sources and Telecosm by Gilder is something that I would like to recommend. Yet the views expressed in the following articles are my own and may be wrong. I invite you to please provide me valuable feedback and opinions on these.

The Issues with Communications Revolution
We all expected that communication revolution that started with the Internet to invade every aspect of our professional and personal life would hit us soon. We all waited but it hasn’t come yet. There are reasons that are apparent in the hindsight. Some of the prominent ones were:
1) Lack of Cheap bandwidth
2) Lack of last-mile access Infrastructure
3) Lack of Ideas.

Bandwidth Problem
The applications thought possible, during the peak of the 2001 tech bubble were conventional applications. Like “movies-on-demand”, a lot of these applications required bandwidth that is simply not available. Some applications like Internet based real-time ERP faltered because bandwidth across international borders was absent. This connectivity was essential as the businesses became more and more globalized.

But as of now, a lot of band has come up. There is a lot of fiber very close to where you are sitting and reading this article now. A significant gain has also been because of the price discovery of the fiber bandwidth by the service providers. Service providers now see fiber-optic cables as information pipes and are focusing on capacity utilization. This seems to be common sense wisdom and they were focusing on these earlier. But there is a key difference. I will highlight it as we come to it.

Last Mile Access Infrastructure
Last mile access was unavailable. By this I do not mean that we had no solution to last mile connectivity, but that it was expensive.
Often the accessing equipment could be used for little else. The desire was never urged on by a need. This is exactly what mobile-phone revolution has done. The coming of age of 3-G mobiles has given the mobile users different ways and means to be connected. The revolution has changed the lifestyle of people making them comfortable carrying a device with them 24X7.
Only two other devices in human history have created such a powerful change, first being wristwatches and second being the Walkman. Yet the key aspect of the mobile revolution is that now people carry with them in the form of a mobile phone, a processor, memory and a modem. And they carry it 24X7.
This has subsidized (mentally) the cost of getting the last-mile-access device with you.

Lack of Ideas
The foremost problem was the lack of ideas. Of course business has a way of weeding out the bad ideas sooner or later. But there are a lot of things that are starkly visible. Like for example, what Gilder says in Telecosm, we have voice networks (Telephones) carrying data (Fax) and we also have data networks (Internet) carrying voice (Internet Telephony).
Similarly we have different business models running on same “bandwidth”. Like we pay per minute for calls on mobile phones, but FM radio on the same device is free. Some of the data (voicemail) is stored on remote server, some on device (SMS, voicemail). Some data (PIM data) that ideally should be on a remote server is replicated on different devices; where as some data that should ideally be on the device we need to download (MP3, Songs).

Problems are solved…
But all these problems are getting sorted out. And a new reality we all were anticipating is emerging. But it is not something that we envisaged. The new reality is mix of partly things that we anticipated and partly of something totally different. So what is the new reality?
In the next article we will examine the future gadgets that can exploit these developments. We will also examine which gadgets can succeed and what infrastructure can profitably come up to serve the new information applications that will thrive in the new world.

Feedback

Please let me know what you think on this. Your feedback is critical and will enlighten me. And do check back again to read about the new devices and the future of ICE.

India China Agreements

India and China are signing various memoranda of understanding today. I am interpreting these in the light of the few things I have heard and know about India and China. These things make me think really hard about the implications of the interest both countries have shown in coming together. If I can read correctly this is a major "joining of forces" of India and China.

Here are somethings that, if they pan out well for both the countries, should make the world sit up and take notice. Are the current development being undertaken keeping in mind these things or are they simply a matter of chance. That question has a great bearing on the outcome of this "joining of forces". In the case of former there is a very high chance that things will hot up in Asia in the coming decades. In the case of latter, well its a far stretch.

Please let me know your views.

DISSIMILARITIES

1. Roughly 50% of India's GDP comes from the services sector, whereas roughly 50% of China's comes from manufacturing.
2. India has a large english speaking (fluently) population. China is facing that challange.
3. Indian development is spear-headed by private players, givernment is acting as a facilitator (or a hindrance) whereas Chinese development is more government sponsored and private players enjoy a comparatively marginal role.
4. Currently China has got more people in the working age-group than India, however India will have more people in the working age-group than China over the next 30 years.
5. If you look at Indian manufacturing its geared towards more of short-run multiple variety products. China on the other hand is very large runs and few variety products.
6. China has well established infrastructure whereas India is facing that challange.
7. Indian Banking (Development Funding) System is the best in the world whereas China is sorely lacking in that department.
8. China has a structured sports program compared to a nearly non-existent one in India.
9. All said and done China has better regulation and possibly implementation than India which lacks in both adequate "appropriate" regulation (with abundance of "inappropriate" regulation) and a lack of enforcement (and enthusiastic enforcement of "inappropriate" ones)
10. India has the potential to be the kitchen and office of the world. China has the potential or almost is the factory of the world.
    

SIMILARITIES

1. India and China each have nearly a billion people.
2. Both have ambitious space programs, military programs, missile programs.
3. Both have strong traditions that have a similar psyche.
4. Tea! (May be China does not have "cutting" yet!)
5. Both have a similar inclination towards saving v/s spending.
6. Strong Family systems are seen in both cultures.
7. Corruption is a rampant problem in both the countries.
8. Strong tradition has given a strong art, crafts and culture possibilities. Chinese have marketed those very well but yoga and aurveda could well change the face of art and culture like what tai chi and feng sui have done for China.

INDIAN UNIQUENESS (DONT KNOW ABOUT CHINA)

1. Religion and the sheer multiplicity and co-existance of many religions and beliefs. (Dis-regarding Modi's and other politically motivated rioteers)
2. Movies and by far the greatest movie producing machinery ever put in motion (again disregarding some of the overused furniture like "couch" and "beds" and also "make-up vans")
3. Cricket or its existance as an industry that drives the global cricket economy (Forget the lack of vision seen in under-representation at the ICC, or the "arranged" Indo-Pak affairs that go around)
4. Tourism and abundance of the "tourist potential" places.
5. The variety of Cuisines of India, I am not sure if China (or the world) have as much variety.

DONT KNOW IF THAT IS SO:

• Language (Its difficult for each other to grasp the other language however India could have an advantage in swiftness to learn new language whether or not we exploit it is other matter) Bring a udipi guy (or a Punjabi or a Gujrati or anyone else for that matter) into remote chinese village and soon you will know how soon Indians can learn any language in the world.
  

Rahul Deodhar