Messages

766

4G / LTE / Why Can't Reliance Jio Match China Mobile ?

« on: March 23, 2015, 11:17:15 AM »

China Mobile built a whopping 720,000 4G base stations in 2014, covering all cities/towns and villages on the East Coast. Average of over 10mn 4G subscriber new add per month in 2H14 driven by tariff subsidy and better network coverage. The maturity of 4G smartphone technologies helped to push 4G penetration. China Mobile sold over 100mn 4G smartphones in 2014.

And on the Other Hand Mukesh Ambani led Reliance Jio Infocomm has been talking and talking and I wonder if their coverage has even reached a pathetic 1/10th of what China Mobile has achieved ?

767

4G / LTE / Hectic bidding for 800Mhz LTE Spectrum

« on: March 20, 2015, 11:18:48 AM »

?800MHz spectrum saw a price escalation of 5% on the 14th day of auctions. This is higher than the price escalation witnessed on the previous day.
 ?Price increase in the 800MHz band was seen in 6 of the 20 circles where 800MHz spectrum is being auctioned: AP, Assam, Delhi, MP, Maharashtra and North East. 800MHz spectrum costs Rs 51bn/MHz for the 20 circles where such spectrum is auctioned.
 ?Frenetic bidding in the 800MHz band is being seen in circles where 5MHz of contiguous spectrum is available: Assam, MP, Mumbai and North East.
 ?In Delhi, MP and Mumbai, 800MHz spectrum is now priced higher than 900MHz spectrum!
 ?1800MHz spectrum saw price escalation in 2 circles: HP and Kerala.
 ?2100MHz spectrum didn?t witness any price escalation.

768

4G / LTE / China Telecom FDD-LTE to Cover 80% by 2015

« on: March 20, 2015, 09:01:32 AM »

China Telecom intends to cover all cities with 4G services in 2015, representing92% by population and 80% by geographical span. CT plans to expand its network to over 320k macro 4G base stations (+200k YoY)and over 140k indoor distribution systems(+80k YoY) by 2015-end,making its claimed 4G network quality comparable with that of China Mobile in urban areas. 4G users ramped to 7m at 2014-end.

The co delivered Feb-2015 mobile net adds of 0.9m, including a0.9m 2G user loss and 1.8m 3G+4G user adds. We believe the extensive deployment of base stations will trigger a clea ruser recovery in 2015. Nearly all subscribers should be 4G by 2016-end.

769

Technology / Qihoo Business of Enterprise Security

« on: March 19, 2015, 04:35:06 PM »

On enterprise security, management believes that the market in China was about US$1.5bn in size in 2014. In the past, the industry has been growing at an annual rate of 15-20%. Now it is growing at ~40%, according to the management. Management noted that 400 big enterprises have already become Qihoo enterprise security users, but most of them have yet to pay. Management believes the enterprise security business will see a non-GAAP operating margin of 30%.

On the search business, management believes that its PC search traffic is still growing and taking market share. Organic search traffic (users type in so.com or Haosou.com) currently accounts for over 50% of total traffic. Out of the ~100K search customers now, the company estimates ~5% are KA (Key Accounts).

Management is still comfortable that it can continue to gain market share in China's mobile game market, aiming for ~70% YoY growth.

770

Web 2.0 / SouFun - Online King of China's Real Estate

« on: March 19, 2015, 04:29:50 PM »

SouFun's coupon business is still growing YoY while its new direct sales business is growing much faster. For earnings contribution, however, the take rate of the coupon business model is stable at around 50%. For the direct sales model, the commission rate has been steady at 2%, but SouFun still needs to pay out to third-party cooperators or end customers to attract more transactions. The rebate to end customers is now around 60% (vs. 80% in 2014) for internally generated transactions. For transactions generated by third-party partners, SouFun normally pays out 80% of the revenue to them in order to retain and attract new users. Management believes that competition from new business models such as Fang Duo Duo is likely to continue and the competition is not likely to stop any time soon

In the secondary transaction model, SouFun is making good progress by charging a lower commission rate (0.5%) than traditional offline agents (~2.5%). Management expects to keep the 0.5% commission rate in the next two years. Traditionally the lack of available-for-sale secondary property information has been a weakness for SouFun. However, now SouFun has over 600K unique and real available-for-sale secondary property information points. Home owners in Beijing actually add 5,000 new secondary property information points to SouFun?s database on a daily basis. As such, SouFun can utilize this database for both internal sales people and
franchisees.

771

Web 2.0 / eCommerce Complaints Rise in china Too

« on: March 18, 2015, 10:38:50 AM »

China's March 15th World Consumer Rights Day focused to an unprecedented extent on complaints from the e-commerce space. According to a report analyzing China e-commerce related complaints released by the China ecommerce Research Center (CECRC) in mid-March, the total number of complaints rose 3.3% YoY to over 100,000 in 2014. Online shopping was the top target for consumer complaints in each month of 2012, accounting for 47.6% of total complaints. Offline-to-online (O2O) and mobile e-commerce ranked 2nd and 3rd with 24.2% and 12.4% of total complaints. Notably, 2014 witnessed a surge in complaints on the internet finance front, likely reflecting among other things the fact that legislation currently is lagging behind industry
evolution in this segment.

According to the CECRC, unreasonable returns and replacement policies, difficulties in obtaining refunds, and counterfeit products & fraud were the three main areas of complaints for consumers in using e-commerce and Internet services in 2014, representing 16.4%, 13.5% and 11.7% of total complaints received, respectively. The rise in complaints around unsatisfactory returns and replacement policies (+6.3% YoY) may have been aided by the more intensive enforcement of the amended ?Law of PRC on Protection of Consumer Rights and Interests? act of March 2014. The law mandates that an internet-based business is required to entitle the consumer to hassle-free returns within 7 days of the receipt of the product. The number of counterfeit product & fraud-related complaints remained at high levels last year, and did not see any marked improvement.

CECRC also disclosed the top 10 most successful online retailers in customer satisfaction, as well as the 10 lowest scorers. JD was selected as the top online retailer, followed by Jumei and Suning.com. By contrast, Taobao* marketplace (the C2C platform) saw the lowest ranking, with Dangdang and Xiaomi marketplace placing just above it. China's B2C players generally deliver better service levels and faster complaint response times, and lead in various other metrics, over their C2C counterparts.

772

5G / Wi-Fi / Spectrum Auction - Action Shifts to 800 MHz

« on: March 17, 2015, 03:18:56 PM »

All action seemed to have shifted to 800MHz spectrum where prices escalated by 3.5% on day 10. Persistent activity in 800MHz could be due to incumbent operators looking to acquire spectrum in select circles which can be later leveraged using e-GSM or LTE technology.

800MHz witnessed steady action in few circles, such as, Assam, North East, Madhya Pradesh, Maharashtra, Andhra Pradesh and Delhi, where spectrum prices have escalated by 23.7%, 15.7%, 9.3%, 6.1%, 6.1% and 3.0%, respectively. Prices for 800MHz spectrum escalated by 47.8% over the reserve price on like-for-like basis. In 3 circles for 800MHz spectrum ? Andhra Pradesh, Madhya Pradesh and North East, demand continued to be in excess.

We believe that incumbent operators could be interested in 800MHz as the prices for 900MHz spectrum are high and this spectrum band has similar propagation characteristics, emerging LTE ecosystem and availability of contagious 5MHz spectrum in some circles. Although price for 800MHz spectrum has increased by 47.8%, it is still cheaper than 900MHz spectrum by 46.9% on like-for-like basis.

773

Smart Connected Devices / Apple Watch - All Models Price List

« on: March 13, 2015, 09:41:08 AM »

WE present to you the complete pricing of all the models of Apple Watch from Watch Sport, Space Black Stainless Steel, 18-Karat Rose Gold and their Accessories as shown below.

774

Smart Connected Devices / Promote Ads in Google AppStore

« on: March 11, 2015, 12:56:31 PM »

Google has announced that it will soon let software developers pay to promote their apps in the Play store for the first time. Building on our analysis of the App Economy.

We estimate that if only 3% of the 57bn apps estimated to be downloaded via the Play store this year are downloaded as a result of an app store ad and that the average CPI (cost per install) paid to Google is $1.50, that Google could generate $2.5bn in app marketing revenue via this initiative. It?s unclear what, if any, revenue sharing arrangements Google may have with its wireless handset and carrier
partners for this product, but even if as high as 30-50%, this still represents a significant new revenue opportunity for Google.

775

SmartPhones & Apps / Android Gaining Share in Mobile Transactions

« on: March 11, 2015, 12:52:39 PM »

Although not a direct competitor to Apple Pay, Pichai also mentioned that Google and Samsung would work closely to see how the two companies could align the also newly announced Samsung Pay (an Apple Pay competitor) with Android Pay.

Recent news such as PayPal?s acquisition of Paydiant, Samsung?s acquisition of LoopPay and the subsequent announcement of Samsung Pay, as well as Google?s announcement of Android Pay are all supportive of our expectations for continued share gains for mobile transactions. As of the end of 2014, iOS devices continued to account for the majority of mobile transactions at 66% of the total, but this was down from 73% a year ago. Android is taking share from Apple, and according to Adyen, Android mobile will likely hold the largest share of transactions for all devices in the latter half of this year with current share at 25%.

776

3G / HSPA / EVDO / Spectrum Auction - Day 6 - Near Ending

« on: March 11, 2015, 11:04:49 AM »

Although prices for 900MHz spectrum escalated only 1.9% on day 6 (1.7% on day 5, 5.2% on day 4, 11.8% on day 3), demand continued to outstrip supply.

Demand for 800MHz spectrum is limited to 14 circles, while the average price increased 5.7% on day 6. In the 1800MHz spectrum, price rise was limited to only 3 circles, while Gujarat and Kerala circle saw demand for the first time on day 6. While prices for 1800MHz spectrum jumped 8.7%, those for 2100MHz spectrum rose 0.4%.

Although the pace of price rise has slowed down, demand continues to outstrip supply across all spectrum bands, except 2100MHz. We anticipate Bharti to aggressively bid for spectrum to expand its footprint. Idea may opt out of spectrum renewal in 1 or 2 circles such as Karnataka, where it has bought sufficient 1800MHz spectrum and has relatively low revenue market share, or Kerala, where it has already bought 10MHz spectrum in the 1800MHz band

777

3G / HSPA / EVDO / Spectrum Auction - Price Rise Modest on Day 5

« on: March 10, 2015, 10:03:44 AM »

Day 5 of spectrum auctions indicated that auction activity is limited to a few circles. As excess demand is in maximum 3 circles in any band, the pace of price rise will be slow.

900MHz spectrum: Only marginal price rise on day 5
Prices for 900MHz have increased by an average 78.3% over reserve price, with only 1.7% price rise on day 5 versus 5.2% on day 4 and 11.8% on day 3. Spectrum renewal costs for Bharti and Idea have escalated to INR101.6bn and INR218.8bn, respectively, for 5MHz spectrum in each of the circles, an increase of 64.8% and 73.8%, respectively; the replenishment cost of entire spectrum has jumped 63.6% and 71.2% to INR151.8bn and INR288.8bn, respectively. For 900MHz spectrum, excess demand is only in the Haryana circle. Gujarat and UP (West), must-win circles for Idea, clocked price escalation of 58.7% and 224.3% over reserve prices, respectively. Price for the Rajasthan circle, a must-win for Bharti, escalated 89.4%.

Demand for 800MHz spectrum is limited to 14 circles, while the average price increased 5.8% on day 5. 800MHz and 1800MHz spectrum have excess demand in 3 circles and 1 circle, respectively. There is no excess demand in 2100MHz spectrum. In 1800MHz and 2100MHz spectrum, price rise was limited to only 1 and 3 circles, respectively, on day 5.

778

4G / LTE / Demand in select circles for 800MHz, 1800MHz

« on: March 09, 2015, 11:28:55 AM »

Demand for 800MHz picked up in select circles as 900MHz spectrum started becoming more expensive. On day 4, 800MHz spectrum evinced demand in AP, Delhi, Gujarat, Punjab and West Bengal circles, which did not see demand on Days 1 and 2. In 1800MHz spectrum, price for AP circle spectrum escalated 43.7% over reserve price, whereas price escalation in other circles has peaked at 2.9%. For 2100MHz, only Assam, North East and Rajasthan circles have seen double digit price increase.

Demand for 1800Mhz increased to 14 circles, from just 9 circles on day 1.

779

3G / HSPA / EVDO / 900MHz spectrum - Prices Rise Whopping 75% - Day 4

« on: March 09, 2015, 11:27:19 AM »

Prices for 900MHz have increased by an average 75.3% over reserve price, though the pace of rise slowed materially on day 4 to 5.2% from 11.8% on day 3 and 14.8% on day 2. Spectrum renewal costs for Bharti and Idea have escalated to INR101.3bn and INR214.6bn, respectively, for 5MHz spectrum in each of the circles, an increase of 64.3% and 70.4%, respectively. The replenishment cost of entire spectrum has jumped 63.2% and 67.7% to INR151.5bn and INR282.8bn, respectively. For 900MHz spectrum, excess demand is limited to only 2 circles?Assam and Himachal Pradesh. Gujarat and UP (West), must-win circles for Idea, witnessed price escalation of 58.7%% and 208.8% over reserve prices, respectively. Price for the Rajasthan circle, a must-win for Bharti, escalated 89.4%.
 
 

780

SmartPhones & Apps / JustDial Search plus and transaction revenues to match search revenues

« on: March 09, 2015, 11:23:46 AM »

The launch of the new Just Dial app was delayed as the company wanted to introduce a best of breed app integrating all the search and transaction options with its traditional search model. It currently has ~150,000+ vendors on its search plus platform. At present the company is conducting ~4,000 (40-60% conversion rate) reverse auctions per day and gets requests for upto 2,000 doctor?s appointment per day. This is significantly higher than anticipation and the management is very optimistic about the segments such as ecommerce, travel, doctor appointments and food ordering segment over the long term. In their view, revenue from search and search plus services could be equal in 2020.

The management believes that amongst the ecommerce players Just Dial has the most efficient pricing discovery platform. Key advantages above the other ecommerce marketplaces are (a) faster and same day shipping as majority of vendors operate locally and (b) replacement of goods purchased is faster as compared to other players. The aim is to offer superior and rich user experience. It does not see any reason to alter its business strategy

Growth in the traditional online classifieds business is strong. The technology eco system is driving many consumers online and hence vendors are looking for online presence. Voice search is coming down due to higher adoption of mobile and PC searches.