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The mobile entertainment story

The great Indian market with its gigantic size is a marketers dream come true, writes Puneet Mehrotra.

business Updated: May 10, 2006 21:42 IST

If cinema is a reflection of the state of the nation then Do Bigha Zamin, Mother India aptly defined the plight of the poor, debt ridden farmer in rural India in the 50's and 60's. Fast forward to 2006, in Taxi Driver Nana Patekar's Nokia mobile rings Beep Beep.

The great Indian story of prosperity and mobility

In the last five years the mobile phone has literally become a part in the upward mobility of the average Indian. The chaiwala, the taxiwala, the farmer, the housewife, the kabadiwala, and just about everyone today has a monthly budget to keep their mobile phones alive.

The Great Indian Market with its gigantic size is a marketers dream come true.  India has emerged as the second largest mobile handset market. According to reports the total market for handsets alone was valued at Rs 8.05 billion ($2billion) in 2005 and this will surge up another 62% by 2007, with approximately 100 million subscribers nationwide.

In early 2006 there were approximately 98 million (TRAI March 2006) people in India who owned mobile phones. Late last year in a single month 2.9 million new Indian mobile phone subscribers were added: the GSM subscriber base grew by 2.11 million users (for a total of 65 million) and the CDMA platform added 0.8 million (for a total 20 million).

The great Indian mobile democracy

Democracy through the mobile seems to be the buzzword in the entertainment industry of India.  Consider the case of Sa Re Ga Ma Pa. The winner received over 1.25 crore votes through SMS just in the final episode. The episodes were spread over 9 months. Each episode received a few million votes through SMS. The cost of an average SMS is approximately Rs 2 in India. Just in the final episode the winner and the runner-up got 1.25 crore and 1 crore votes respectively. Hence, the value of SMS just in that single episode was Rs 2 X 2.25 crores = Rs.4.5 crores.

These days every soap, ever news channel, every radio station, every portal has mobile voting. According to a Lehman Brothers report a market of Rs 2,300 (including texts) crore has been created. Over 98 million mobile users, straight from their living room, offices, buses, farms, workshops, railway stations are contributing to this huge mobile entertainment boom. The market is split into three major players -- mobile operators, media companies and aggregators.  The revenue split is in the ratio 60:30:10 with the operators calling the shots.

Contests to ring tones, wallpapers, gaming, weather forecasts, railway and airline ticketing banking, astrology services just about everything is on the mobile phone now. There was even a SMS a Loan service launched by a banking major last year.

The content opportunities

Significant opportunities for content providers are available in this booming market. In India, wireless operators, music and film companies, cartoon artists, game makers and musicians are all aggressively entering the mobile market for ring tones, gaming, mobile imagery and streaming audio and video.

Telecommunications firm like Qualcomm, promoter of CDMA networks, have highlighted India as a future hub for mobile development on its BREW platform last year. Binary Runtime Environment for Wireless (BREW) is a suite of software tools that help developers create small, creative applications for mobile users. These are bought off the developer by CDMA cellular service providers (Tata and Reliance in India) and offered to mobile users for a monthly fee of Rs 30-35. Applications range from games, to astrology to just about anything you can think of.

Airtel recently launched a service to save your phone book to the server so that you don't lose your contacts even if your phone gets damaged or lost, which comes at a price of Rs 30 a month. According to a report, out of 18 million Reliance subscribers, more than 10 million use data regularly.
 
The great Indian rural market

Currently the consumption of value added services is greater in the urban markets, but with subscription levels approaching their saturation point, rural and semi-urban markets will potentially offer tremendous growth for the value added industry.

Noteworthy, mentioning is that the mobile phone will probably do what the computer couldn't do to the rural market. Electricity is a scarce commodity in India. The capital of India is starved of electricity and the rural belt hardly gets it. A mobile phone doesn't require continuous electricity and is capable of providing services that can prove to be handy.

Localized content such as video clips, mobile comics and mobile magazines in regional languages, would provide entertainment to various rural pockets. E-learning and e-governance initiatives would meet a major need of the rural users and would have a great appeal to rural masses. Such content would help mobile services providers to open up largely untapped rural markets.

The future of mobile entertainment

Broadcasting and value added services are witnessing a lot of changes and innovation across the globe. Just yesterday British Sky Broadcasting (BSkyB) announced plans to conduct technical trials of Qualcomm's MediaFLO technology in the United Kingdom.

FLO technology, a multicast innovation and key component of the MediaFLO system, is an air-interface technology designed to increase capacity and coverage, and reduce cost for multimedia content delivery to mobile handsets.

Engineered specifically for the mobile environment, FLO technology is designed to offer several advantages over other mobile multicast technologies. Those advantages include higher-quality video and audio, faster channel-switching time, superior mobile reception, optimized power consumption, and greater capacity concurrently as compared to other multicast technologies.

The key for growth of entertainment on mobile phones is spectrum and handsets. India has one of the lowest spectrum allocations in the world.  Even for that little spectrum companies have to battle it out. The spectrum is divided in the ratio 2:1 between GSM and CDMA.

Taking the bigger picture into account, with the biggest companies in the business and the increasing industry size it's only a matter of time when the spectrum issue is resolved and technologies like 3G are introduced. Boom! is the word for mobile entertainment industry, in times to come.

Puneet Mehrotra is a web strategist at www.cyberzest.com and edits www.thebusinessedition.com you can email him on puneet@cyberzest.com