Author: Aditya

iPhone and the high non-iPhone mobile tariffs

Apple‘s iPhone is widely hailed as a must-have for most mobile operators, so much so that some go to quite some lengths to get the phone on their networks just to stop haemorrhaging of high-value customers.

There seems to be an un-talked-about additional benefit to mobile operators from the rise of iPhone – higher ARPUs on non-iPhone plans than they’d otherwise get.

The iPhone Tide

As visible in the graph above, after taking out the retail cost of the phones, the monthly cost of an iPhone contract is consistently lower than that of the relatively no-risk SIM-Only plans. As a comparison, the similar ex-phone monthly cost of a Samsung Galaxy S3 is also higher than that for an iPhone on both EE and Vodafone (though surprisingly lower on O2 and 3’s networks Note 4-G).

It appears that the operators are giving up margins in the device (compared to pure hardware sellers like Amazon or Curry’s Note 4-F) and/or margins in monthly tariffs (compared to SIM-Only plans) to ensure the iPhone users stay with them. Add in the higher network traffic from iPhone owners (as frequently reported in media Note 5), and higher risk (compared to no-hardware SIM-Only plans) and it seems that the operators are killing the very reason they want iPhone owners so desperately on their network – higher revenue realisation.

My guess is that something else is happening. Instead of a SIM-Only plan being a baseline price, of sorts, and iPhone plans being built upon it to at least recover the phone subsidy, it’s the other way around. Operators have set the ex-phone monthly cost of an iPhone contract at the baseline figure – the minimum revenue realisation they want from a pay-monthly customer. Then, they’ve built all other phone and SIM-Only plans on top of that baseline figure.

This ensures that instead of haemorrhaging on iPhone contracts, and making normal profits on all other contracts, the operators now get to make normal profits on iPhone contracts and above-normal profits on all other contracts.

Thus, the cost of an iPhone contract acts as a high tide raising all the other contract prices along with it, resulting in higher ARPUs for operators than would have been possible in a non-iPhone scenario. Obviously, the telcos must love the iPhone Note 6.

 

Continue reading iPhone and the high non-iPhone mobile tariffs

Thoughts, from a lost context

Discovered these thoughts scribbled (hypothetically) on a note in a draft on my phone. Have lost the exact context in which they were written, but they still seem intuitive yet incisive:

Now that I think about it after a few hours, maybe it’s not just who you work for. Another factor could be what state is the organisation you work for in. I was comparing my state – kindling a startup – to theirs – working in huge, established organisation. My priority is speed. The priority in their organisations may be stability. My focus is to get there somehow. Anyhow. For their organisations, the focus is to stay there.  And to stay within the rules, norms and processes. My focus is quick iteration. Their organisations must be focussing on long-term strategy. Though, one thing is common – the target for both of us is survival. That doesn’t change with size.

Android Jelly Bean – Search/Now App & Voice Commands

Android Jelly Bean - Google Now/Search App - Weather
Google Now weather card on left; Weather card from Google Search app on right.

The Good

Voice commands now recognise my Indian accent, and do a pretty good job of it. Much better than any other speech recognition service I’ve used so far. Thanks Google!

The Not So Good

When using voice commands (or just regular text-input search) from home screen, the Google Search/Now app forgets all about my location, and other relevant data.

For instance, by default the app shows a card with weather in my location (London, UK). But when I ask for temperature (weather) using the same app, it shows me a card with weather in Washington, DC!

I tried a few other searches too – pizza joints, bus services, etc. In all cases, the app just displays generic results without using my location (or time zone) information. Is something badly broken here, or am I doing something very wrong? Hope folk from Android team notice this issue (there seems to be no way of sending feedback/bug report) and sort this out.

Also, there’s the small bit that the Indian accented speech recognition works only with an Internet connection. Offline recognition only supports US, UK and Australian English :(

More, as it comes.

Netflix – Good Strategy, Bad Execution?

Read this interesting piece on cnet about Netflix’s problems last year, and their CEO Reed Hastings. The author blames, not in these exact words, Reed Hastings for everything that happened, and hints at hubris as the cause.

After reading the article twice, the only fault I can find with the initial decision (of separating DVD & Streaming subscriptions, and increasing prices), is in the way it was rolled out. The decision itself seems strategically perfect.

In fact, had they not so messed up with the execution of that strategy, that decision should’ve gotten Mr. Hastings a standing ovation for foresight and business acumen.

With the benefit of hindsight (and probably even without it), here’s how I think the strategy should’ve been executed:

  1. Limit the number of movies/shows available for streaming to about half of what the median user was streaming. Don’t mess with the price.
  2. Offer a separate unlimited streaming package for $7.99, as they did.
  3. Offer a separate unlimited DVD only package for $7.99, as they did.
  4. DO NOT offer an add-on unlimited streaming bundle to the 1st option for $4.99

This laddering of subscription options will slowly filter the customers into one of the three buckets. Moreover, the lack of the 4th option will help push more customers into choosing one of option 2 or 3, instead of staying with option 1.

Now, keep the new pricing for a year. End of the year, if a majority of the customers are still on #1, increase the price to, say, $14 while still keeping the cap. If not, retire the 1st option forcing the users to choose one of the other two.

Using this ladder & stagger manner,

  1. doesn’t make the users feel like they’re being sucker punched on pricing.
  2. lets the users filter themselves into one of the new buckets without feeling they’re under an ultimatum to do so.
  3. lets the market confirm your business strategy before you’ve made the final split.
  4. reduces the negative voices when you finally decide to remove option 1.

Unless there was some internal politics at play, or pressure from content providers (Hollywood studios or, maybe, Starz), there doesn’t seem to be a good reason for the abrupt, arrogant, even amateurish manner in which the strategy was executed.

Wonder if this could be cited as one of the few instances when having execution-oriented external business consultants at hand would’ve been helpful? :)

Continue reading Netflix – Good Strategy, Bad Execution?

Android Jelly Bean – First Impressions & Suggestions

Android - Jelly Bean
Android – Jelly Bean

Great Things

  • Super fast responsiveness.
  • Love the transition effects in/out of apps, but would’ve loved to have an option to switch them off.
  • Google’s own apps have been optimized and work really well.
  • Default Gallery app has been fixed – use to take ages to load albums, now is faster than even QuickPic.
  • Google Now works brilliantly.
  • Face Unlock now works despite my having encrypted the phone (in ICS, only options were password and passcode), and works really well!

Issues

  • While Google’s own apps have been optimised for Jelly Bean, most of 3rd party apps haven’t. This causes quite a bit of dissonance – both in appearance and performance.
  • Google Now works really well here in London. Wonder how it’ll do when I visit back home to my small town in India. Or even smaller towns here in the UK.

Suggestions

Matias Duarte and the Android team have done a great job on the looks and responsiveness of Android. They now need to sort the issues around wide variety in quality of apps, and of OS upgrades. I suggest they exchange notes with the Chrome team.

For homogenizing the app quality, they should take a similar approach to what Chrome team has announced for roll-out of Manifest Version 2 to apps on Chrome Web Store ( See ‘Manifest version 1 support schedule‘). Also, as earlier suggested by Abraham Williams, OS updates should be moved to a rapid release schedule, and (my input) be turned into silent upgrades – just like Chrome.

These changes might require some heavy lifting at the OS/update architecture level, but can be real game changers for Android in the platform wars.

Continue reading Android Jelly Bean – First Impressions & Suggestions

The Perfect Travel Blogging Tool

Google Glasses with:

  1. auto-upload images to Google Photos enabled.
  2. offline voice to text function, text saved in a Google Doc.
  3. a Google Apps Script adding a time-stamp (and, if possible, a GPS location) to every piece of text saved to the Doc above.

 

Now, go out on your trek up Ben Nevis. Whenever you like a sight, take a picture and dictate a description. Dictate a note every time you cross a milestone or just wish like noting something. It all gets converted to text and saved in a Google Doc, on your Google Drive.

Another script could pull in auto-uploaded photos and add them to the Google Doc with time-stamped dictations.

That’s it, without having to type anything, you now have a blogpost with all your photos and thoughts from the hike listed together in a time-ordered sequence. Edit it if you want, or just post it away!

(You could even have a script which would automatically upload this to your Blogger blog as a draft, and add a reminder in your calendar to preview and post)

Required: Google Glass, Google Docs and someone to write those Google App Scripts (that could be me).

Note: This piece is just a figment of my imagination, and this idea or I are in no way related to Google. Also, like everything on this blog, this idea is covered under the CC-BY-3.0 license so feel free to use it as you like, with attribution.

Stop Hustling

Loved the idea of Clik. As an end-user, and as a developer – a product that takes away a lot of pain for us while developing an app we are starting work on. Thanks!

However, there’s one note of concern. In this post-Path fiasco world, I (and quite a few people I know), have made it a habit of reading the ToS and Privacy Policies of apps and services before we get down to using them. Combined together, those two documents for Clik are over 20 pages of densely packed jargon.

Having read through enough of them, I know which parts of a legal document to read carefully and which to browse through. Most people don’t. And this is what causes them to ignore these at the time of acceptance, and cry foul later when they realise their trust has been broken.

Wouldn’t it be better, for the sake of users’ sanity as well as to prevent the nascent firms falling into trappings offered by legalese, to present a concise, truthful summary of those documents (ToS, Privacy Policy and like) in a language that every day people can understand?

Let the lawyer’s version be there, it can be helpful in certain, usually unfortunate, circumstances. But let there also be a concise, non-legal lingo version of it as well. Something that normal people, the end users, will read and understand. Something that defines the spirit of the legal words. Something that says, that though the legalese leaves space for doubt, we promise we’ll do just this & this, and never that, with your data.

Who writes it is secondary. The entrepreneurs could write it, or they could hire someone (non-legal) to write it. What’s important is that it be short and clear enough for everyone to read, and that everyone signing up be encouraged to read it.

———————————————————-

The current trend of hiding behind the legal version can be problematic not just for the end users, but also for the companies involved. It can make the entrepreneurs feel assured that the legal document gives them enough cover to do everything within its limit. Which is true in a court of law. Not so true in the court of public opinion. For Instance, the address book uploading that Path and many other developers did may be legal and covered in their ToS/PP but still created a furore in the media. Had they been required to write what they were doing in a couple of clear, concise sentences and tried that everyone who signed up read them, I doubt they’d have suffered the same fate.

P.S.: Your post above is less than 300 words and you do a good job of introducing the company, explaining the product and making a pitch. I’m sure start-ups can explain the core of their privacy policy and terms of service in under 500 words with equally simple language.

Posted a version of this post as a comment here.

Tizen viewpoint – Sept 2011

I wrote this note on Tizen last September when it had just been announced. Someone I was pitching for work to, had asked me for a brief note on Tizen, and this was my submission. The recent announcement by Samsung about merging Bada with Tizen reminded me of this note and so I decided to post it here. [Having just read it again, it again showed how quickly this industry changes – what seemed so unlikely a few months ago seems one of the likeliest outcomes now.]

The Background

The Tizen project is a coming together of multiple organisations, OEMs, Intel, Linux Foundation and maybe even telecom operator, with unusually varying motives and thus has both the advantages – becoming a widely accepted industry standard – and the disadvantages – lack of ownership and direction – of any such project.

The OEMs have for some time now been in a struggle for control of industry profits and dynamics with the big three platform owners – Apple, Google & Microsoft. Till recently, Google with its open, free & independent Android was the platform of choice for these OEMs. However, all three of those qualities of Android are now in doubt thanks to Google’s pending acquisition of Motorola, Microsoft’s patent taxes and moves from Google to tighten control over development and deployment of Android.

Intel has long been trying to get a foothold in the smartphone industry, where ARM designed chip-sets dominate. With mobile OS platforms being adapted and extended to tablets, TVs and other connected devices, Intel realises that it could be left out of a huge and fast growing market catering to all possible connected devices. While MeeGo and its AppUp store may be part of its attempts to develop a complete platform, at its core Intel is fighting for relevance as the industry moves towards a low-energy, connected device environment.

For LiMo and Linux Foundation, this coming together of Intel, OEMs and, possibly, some mobile operators may present an unprecedented opportunity to promote Linux’ acceptance as a wider consumer platform. Being committed to an ‘open’ environment, Linux Foundation could also provide a neutral outlook to Tizen by ensuring no single promoter could lock-in the platform to its own proprietary technology.

On the technical side, the development and widespread acceptance of HTML5 standards opens up another opportunity for a new platform. When combined with the Linux core of LiMo or MeeGo, HTML5 obviates the need for an advanced set of proprietary tools to enable app development while allowing for quick porting of applications from established OS platforms. This had been a handicap for both LiMo and MeeGo with the requirement of native apps and, Nokia-owned, Qt apps, respectively.

The Strategy

Although the background to announcement of Tizen seems clear now, the future strategy is still a little hazy. However, considering the primary goals of key backers, a possible strategy for Tizen may be to develop the core OS and a set of development tools, with a very basic platform of content and services around it.

This would allow its key supporters – the OEMs, Intel and telecom operators – to customize the platform to their own individual needs and branding. All of them also want to independently capture the benefit of content sales flowing through their devices or networks, and an open, independent platform may suit their needs better. Intel would benefit by reducing the control of big three platform owners in deciding which chip-sets may be supported and ensuring Tizen is fully Atom-compatible.

One aspect critical to its success, though, will be support from app and content developers. Use of HTML5 as a development platform eases the transition path for developers but without a single large market or a strong promoter (like Microsoft with WP) backing it, developers might be vary of committing to the platform. Also, remaining to be seen is the DRM support on the platform – a lack of which may keep off content producers.

Ultimately, solving the riddle of ‘Which comes first – Apps or Customers?’, may require strong actions from Tizen’s backers beyond making announcements. These actions could be in a form similar to Intel’s recent $300 million Ultrabook fund, incentivising developers for apps and content for Tizen and OEMs for using the OS along with Intel’s AppUp store. Quick release of an SDK with a set of APIs and the initial set of devices will also encourage the developer community to take the device seriously.

The Future

Over the longer term, the biggest determinant of Tizen’s future may not be its own development, but how the industry dynamics with other OS platforms play out.

Of the various scenarios possible, the one best suited to Tizen’s success is one in which the bigger OEMs and Intel perceive themselves being further restricted by big three platform owners, are unable to promote their own OS platforms, and see their immediate bottom-lines threatened.

However, in an alternative scenario, if Google decides to sell off the OEM bits of Motorola, resolves the patent issues surrounding Android, and comes to a mid-way understanding with the OEMs over control of the interface and content, it can still rally the independent OEMs behind itself and cause the Tizen initiative to flag.

Also, if the big few OEMs – mainly Samsung and HTC – decide to bet on their own OS platforms by developing in-house (e.g. Bada 2.0) or buying orphans (like WebOS), it could still weaken their support towards Tizen’s development.

At the moment, Tizen is an outcome of spread betting by leading industry supporters while they see how the industry dynamics resolve themselves. To be successful, it will require strong support in terms of development, incentives and new devices from its promoters but that stage is still some time away. Till then, the core OS itself may continue development but as a platform it is likelier to follow LiMo’s graph than that of Android.