Just Dial Search Plus Monetisation Hit Hurdles, Omni ERP in Focus

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JustDial Search PlusJust Dial’s management has been talking about opportunities in “Search Plus” (hyperlocal transaction enablement) offerings for quite some time. Management has indicated difficulty in monetisation of Search Plus transactions. We also have concerns on monetisation of Search Plus, given the bandwidth necessary to manage a large number of offerings (over 25) and competition from several vertical specialist companies.

In the last couple of months, the focus seems to have shifted more towards its mini-ERP offering for small and medium sized merchants—JD Omni. JD Omni is synergistic in the sense that it targets the core classifieds business customer base (mid-to-small sized merchants) to a large extent. On the other hand, it represents a completely different business model for the company (a software product business vs the current listing services business). And the company’s ability to cope with this different business model has yet to be tested.

While there are several products

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Reliance Jio Phased Launch in Next 3 to 6 Months

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Reliance Jio Launch IndiaReliance Jio Infocomm wishes to integrate 800Mhz Spectrum from Reliance Communications before launching commercial services in a phased manner spanning over the next 3 to 9 months. The next 2 months will see upscaled trials (beyond employees), to test scalability and coverage. Their biggest advantage is the pan-India 800 Mhz spectrum for LTE, while none of the incumbents are launching LTE on sub-Ghz spectrum.

Reliance Jio is unlikely to use the 2G/3G network of even roaming partners like RCOM/BSNL, their network coverage needs to be near-perfect

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How Akash Ambani is Positioning Jio Mobile Data LTE Offering for 1 Bn Consumers?

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Akash Ambani's Jio Mobile Data StrategyReliance Jio Infocomm launch still looks to be a few months away. This has been the ongoing dilemma for the past few years now, and the uncertainty is not helping anyone. Management attributed this to a combination of some more testing to be fully-ready for all data applications, being able to integrate 800MHz, etc.

What is Akash Ambani’s Mobile Broadband Strategy for 1 Billion Consumer Market ?
Jio is basing its approach on poor data speeds and low internet penetration in India, and expectation of high growth over the next 10 years in data traffic, especially video

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Jabong Bid Adieu to Aggressive Discounting, Path to Profitability

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Jabong Path to ProfitabilityThe drastic QoQ improvement in Jabong.Com gross margins (900bps) implies that GMV (gross merchandise value) per transaction has improved by 22% to the highest ever even as revenues fell by 8% QoQ. Our reading is that cash-strapped or undingconstrained portals could witness reduction in revenues as they look to monetise the existing customer base with the convenience of range and shipping over pricing.

Jabong’s gross margins (500bps improvement in CY15) seem to indicate that discounting has reduced but operating margin of -49% in CY15 clearly indicates high customer acquisition and retention costs. While discounting on own inventory

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How Reliance Jio will Mitigate Network Quality Issues with 800 Band Spectrum ?

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Reliance Jio Launch DelayedAkash Ambani led Reliance Jio Infocomm has created the required hype and expectations for a High Speed 4G Mobile broadband. However, like any other Telco, Reliance Jio has its share of woes to stabilize and achieve network coverage with the spectrum band its is operating in 2300Mhz and 1800Mhz thus pushing the big bang nation wide launch further ahead. In this backdrop, Jio’s boss Mukesh has smartly shed his ego and shook hands with his estranged brother Anil Ambani’s Reliance Communications which owns 800Mhz spectrum, the best suite for 4G-LTE services.

Jio will manage launch well before December 2016

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Airtel 4G LTE PAN India Spectrum Complete, May Skip 700Mhz Auction

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Airtel 4G LTE PAN India SpectrumIndia’s Largest Telecom Operator, Airtel has acquired 2300MHz in 8 Circles from Aircel to complete Pan India 4G-LTE Footprint by virtue of combination of 1800Mhz and 2300Mhz contiguous spectrum blocks.

The acquisition of spectrum in three circles has been done at a total consideration of INR35bn (~4% of current net debt at the company). Aircel had paid INR 34bn for this spectrum in the 2010 auction, which implies a 47% premium that Bharti has paid when adjusted for residual life. The same spectrum has a reserve price of INR 44bn in the upcoming auction, so Bharti has only paid a 14% premium when adjusted for residual life vs this. The impending entry of Reliance Jio has

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State of 4G LTE Device Eco-System in India

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4G EcoSystem IndiaSmartphone adoption in India is increasing at a fast pace driven largely by device affordability and increasing relevance of devices in day-to-day lives. At the same time, mass adoption of 4G in the rest of the Asia Pacific region has led to steep fall in price of LTE components and consequently LTE devices. The two factors combined with the Indian telcos’ accelerated 4G launches, are driving radical changes in the Indian smartphone market.

Around 42% of all mobile phones shipped into India in CY2015 were smartphones as compared to 10.8% in CY2011; during the same period (CY2011-15), total smartphone shipments grew at a CAGR of more than 50% (source: Gartner). 4G devices are also increasingly

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How RCom gets Free Ride on Reliance Jio’s 4G Network ?

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RCom Gets Free 4G from RJioRCOM has entered into active infra sharing with 4G entrant Reliance Jio, which allows RCOM to offer 4G services without investing much capex. RCOM active sharing limits the upside for the buyer of RCOM towers assets as demand by RCOM (anchor tenant) for additional towers in the near to medium term may not be much.

In our view RCOM had the option to either ask for a premium from Jio for trading of 800 spectrum or leverage Jio’s 4G network and offer 4G services. Charging a premium may have allowed RCOM to pay down some debt and invest in 3G but may have prevented RCOM from participating in 4G.

RCOM has chosen to offer 4G by leveraging Jio’s 4G network. Given that in the medium to long run 4G is likely to be more popular than 3G,

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How is India Graduating towards Digital Money Society ?

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Digital Money in IndiaIn India, cash still rules. 41% of India’s households are unbanked and credit card penetration is a measly ~2% (debit card penetration is much healthier at ~33%). The situation is similar on the retailer side, where only

There are several trends/ initiatives (described below) under way that will transform the financial landscape in the country. Over the coming years, we are set to see a sharp rise in debit card penetration, a shift of banking transactions from offline to online, a greater adoption of electronic payments and greater use of mobiles for conducting electronic transactions. These developments present large opportunities for players operating in the broad mobile money ecosystem.

Pradhan Mantri Jan Dhan Yojna (PMJDY) – The long-term vision of PMJDY is to lay the foundation of a cashless economy and

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Can Reliance Jio Exploit the Net Neutrality Loophole for Free 4G ?

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NetNeutrality Loophole IndiaWe were the Strongest Advocates of 100% Neutral Internet in India. We recommended the TRAI specifically not to leave any loopholes and had clearly written in our recommendations about the potential loophole of Intranets / Closed Electronic Communications Network, yet the TRAI has kept the door wide open for exploitation with veto power in its hands.

How Reliance Jio / Airtel / Other Telcos will Exploit the Loophole ?
The regulator clearly suggested in its recent tariff order that rules prohibiting differential pricing for data will not be applicable to Closed Electronic Communication Networks (CECN) or in other words, the intranet platforms of telcos. Hence telcos may attempt to monetize such an opportunity/regulatory exemption. That said, telcos will find it difficult

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