Friday, 13 June 2008

Connectivity- and the mobile phone business


“Man is a social animal”. I remember this from the preface of our Civics text book in school about 20 years ago.

This thought returns to me often now as I look around at the world, its technologies, its new consumers and its new businesses. And on reading about Nokia now being the most trusted brand in India, I was motivated to put together some reflections on this entire notion of connectivity.

Man being a social animal implies very strongly a desire for connectivity. From telling around a fire to flying around the world- we have continuously evolved ways to enhance our connectivity. Rock paintings, ancient texts, smoke signals, carrier pigeons, horseback riders, telephony, telegraph, post, radio, automobiles, ships…these instruments have made mobility and communication central features of our lives, no matter which corner of the world and in what period of our history we live in.

No matter who we are and where we are, we want to share our opinions. That is a reason why I am blogging and writing this piece.

Over time, different technologies have advanced human connectivity. But each technology succeeding on the basis of Availability (product availability), Accessibility (price/ infrastructure) and Reliability (pigeons get lost, wireless signals- mostly not).

The development of wireless transmission in the past few decades however, has been the key driver in enhancing “mass “connectivity of the human race. For the basic reason that the accessibility and reliability have been high. And the cost per user has fallen fast enough to put a radio transistor (to begin with) in almost every household in India.

On the same path, penetration of TVs is increasing as the price per unit falls and the income rises. And the internet too is on the same trajectory.

But my focus here is on telephony. This is more than transmission. This is communication –two way.

Telephony, since its invention has grown steadily. In India its availability unfortunately was restricted till the late 80s by the infrastructure (cable) availability. However, once this medium too got independent of cables and developed on the wireless platform, its evolution has followed a dramatically different path. Again driven by availability, accessibility and reliability. Compared to TV, print and radio, telephony allows us the advantage of two way communication at an affordable price point. Mobile telephone takes this one step further by freeing us of cables. So while man is a social animal, man is also a “free” animal seeking to be unrestrained in his movements.

So what does the meteoric rise of mobile telephony tell us?

1. People like to be connected. Connectivity at most times (if not all) is actually OK for us since the choice to be disconnected rests with the user. Think empowerment.
2. People will pay to be connected. More so because, mobile connectivity helps to make money (think the neighborhood vegetable vendor who takes your order while he is pushing around his cart and delivers at your doorstep)

Compare this with a TV. It’s an entertaining/ informing medium. Mostly one per household is sufficient. And it costs about Rs 8000.
A phone on the other hand can be as cheap as Rs 2000. And its utility enhances when each member of the family has one. It is not rare to find that mobile phone households usually have more than 1 handset per household.

Riding on the “miniaturization” wave of technology, over the years it has been possible to reduce the cost and size of mobile phones. The industry has been able to hit price points where a large number of Indian households can treat it as a necessity and not a luxury. The industry has created what I call “Nokia” price points. Phones at Rs 1500-2000.

If telephone connectivity can fit into a pocket and be delivered at Rs 2000, which is the cost of a radio set, connectivity will be in the grasp of every individual on the planet.

Ok, so now I am convinced one day we will be able to beam ourselves across the globe. That is the next level of connectivity.

But there is more in between.

• 3G services are pushing for video connectivity through phones.
• Networked web sites and games are allowing social connectivity through phones.
• Nokia handsets now advertise direction finding on the phone.

I am waiting now for the next generation phones that provide me a real time translation facility. While I speak into the hands free mike, a built in device should be able to translate and transmit in real time any other language of the world. Then I am even better connected to my world.

I bet on this being the next “killer app” in the mobile space. Navigation systems will become standard within 3 years. Translations software will definitely take over from then on as the next differentiator.

Now let me focus on Apple.

I believe they have understood that connectivity today is seen in two forms:
1. Social
2. Professional

Social connectivity is the act of being in touch with our family and friends. The device helps us speak…but also helps us make a statement. Hence cooler designs, with more technical specifications. We use this also in business transactions, but more through social protocols.

The Professional connectivity is simply the blackberry service. Basic device designed to access emails through corporate communication protocols.

Why do the two need to be different?

Why cannot one device be cool enough, small enough and powerful enough to respond to both groups? The iPhone is making this attempt and my bet is that they will be very successful.

I work in the mobility business and it’s interesting for me to reflect on the mobile phone business. As well as the media and communication business. All of these businesses recognize that man, like most other mammals, is at the end of the day- a social animal.

Cars, airlines, phones, TVs…we are all trying to satisfy that basic need to stay connected with our fellow beings. This need which comes above our need to brush our teeth, pour on shampoo or spray deodorant.

The mobile phone business, (carriers and device makers included) succeeded before all others in bringing connectivity to every pocket. That is commendable. A group of far thinking people drove the technology and the business models in this industry to where it is today.

How can the automobile industry replicate this? The Nano is a great stride forward in creating new price points. But is it possible to deliver automotive mobility solutions to a consumer at Rs 1500? Or even Rs 1500 per month?

How can the communication industry work with the manufacturers of TV sets to deliver a product that works no matter where (solar energy driven?) and that is available at Rs 1500?

These are the kind of dreams that are driving the Rs 4000 notebook PC. I salute these efforts. These are un-met needs that are waiting for a product at a price point. So people can benefit from technology today.

The challenges of the future of our planet (environment, energy, cultural differences) cannot be solved by one person. Or a few thousand. It needs the engagement and involvement of everyone on the planet.

Connectivity technologies that bring us together raise awareness of the problems and the solutions in the world today. And in celebrating the success of Nokia in India, I celebrate one industry that has made a big difference in our becoming a closer planet.

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