Franciso Varela, YouTube’s Global Director of Platform Partnerships, was recently in India meeting industry stakeholders. In part 1 of this discussion, we speak with Varela to find out more about how YouTube is doing in India, the company’s plans for improving YouTube access on mobile, the status of YouTube consumption on mobile in India, device fragmentation and videos not being available for certain devices, net neutrality, partnerships with telecom operators and whether YouTube subsidises data plans, among others things:
Medianama: What brought you to India?
Varela: It’s just the opportunity. Everything is starting to kick in for this market. In the western markets, for YouTube on mobile, we had data connections, phones, access to networks for a while. It’s catching up here and having its own data revolution here. We have seen it quicken in the last two years in our radar for mobile.
Medianama: How is YouTube on mobile doing in India? I would assume that bandwidth (speed) is still an issue.
Varela: 90% of the users are on 2G, only 10% of the users are on 3G. There’s going to be 70 million smartphones in the market by the end of this year. Hopefully, video can be a compelling reason to take 3G connection and take advantage of what we have to offer. My team at YouTube manages all the mobile implementations, YouTube on your TV, through a game console, smart TV, over the top box, Apple TV, and we also work with TV and cable providers worldwide to bring YouTube to all through these implementations, in a scalable way. We have men on the ground doing quite a bit of work in high growth markets like India and Brazil. We won’t reach our goals unless these markets start firing. Giving access is the most important thing that we can be doing. There are 6 billion plus people in the world, only 2 billion are online.
Medianama: What is the percentage of traffic coming through mobile and which are the devices it is coming from?
Varela: Globally, about 40% of our traffic comes from non-PC devices. There is tremendous growth. When I joined 6 years ago, that traffic was 0%. Here in India, the basic YouTube growth has been tremendous. I think we are doubling every year here. The mobile base is growing here quickly, but its a small base. The next step for this would be to make mobile data more affordable.
When you at countries where there is mobile data, you will see common characteristics: one is that people have predictable and understandable data plans which are unlimited, or had high enough data caps so they didn’t worry about accessing the Internet for services. The second s that people want the same services as they want on the Internet. They don’t want a specialized Internet, like eBay, Google, Twitter, Facebook. We see this around the world. I’m here to speak to the key players in the industry and see how we can help.
Medianama: One of the key challenges has been partners enabling their videos for mobile. Typically, you are not able to see the same videos on mobile because the publisher hasn’t enabled it for mobile. How are you addressing this?
Varela: Actually, not in our case. In the last two years, we have been making sure that a video is available across all platforms. One example of that is our application on iOS for the iPhone. The application was built by Apple and pre-installed on the device. That didn’t change in a long time. We had a great partnership with Apple, and it was wonderful to have that distribution, but there were a lot of things that we were changing that they just didn’t have the resources to keep up with. So, we fundamentally changed that strategy with them last year and started publishing our own applications for iOS. One of the key reasons for it was not just the features but the content. Users would get the message that you talked about (“I’m sorry but this video is not available for this device”).
Any time that a partner built an application – iOS was an example of it, but a lot of the early TV implementations we did with Panasonic and Samsung , they were building the applications. As a consequence, we could not build any advertising as a part of the brand requirements that our partners asked of us. So our strategy was to take back our applications and developing them and making them full featured, ensuring that the content would be available across that set. So it is now quite rare to have a video that is not available on the phone while it is available on our PC site.
Medianama: How are you dealing with the language situation in India in terms of interfaces for the Indic script script? Are you looking to address that to increase users?
Varela: Language across services is a key priority for us. Voice search is going to be important to us. There are a number of ways, and I’m not certainly the expert on this one.
Medianama: How is the cost of data access impacting you?
Varela: That’s another part. Anywhere you see YouTube on Mobile take off, people can access data for very predictable, reasonable and affordable prices. Most of our usage is directed usage. Which means someone sends you a link. People won’t go watch videos unless they are sure about its cost on a data plan. We are having conversations here on how we can provide that predictability to the user.
Medianama: What are the partnerships that you have done globally with carriers, hand-set providers that have helped increase access?
Varela: With handset providers, we make sure that the applications are working on the handset. There are loads of handsets that carry the YouTube icon right on the front page. We have worked on deals making sure that there are data packages available. If a carrier wants to partner with us and use our logo and market with YouTube, then they should have a reasonable data plan available to the user. That’s at the heart of our proposition.
Medianama: Do you also subsidize plans for users?
Varela: No we don’t.
Medianama: How are you handling consumer education in India especially when users don’t use Internet on a phone that can be data enabled?
Varela: In our research, we found out that there are more 3G devices here than there are 3G users. People buy 3G phones and use 2G capabilities with a 2G card. That’s not something that we’re going to win on our own. To provide a mobile ecosystem to make video work, you need to have good device technology, access to good 3G, broadband at home, affordable and predictable data and a good product along with good awareness of the offering. Of all these things in a country, we can take responsibility only for one thing to work on, and that is the product. Everything else, including awareness, relies heavily on partnerships and that’s what we have been doing for these six years.
Medianama: From a product perspective, what kind of device fragmentation do you see in India and how do you deal with it?
Varela: We work better on smartphones than on feature phones. There’s iOS and Android that are massive part of the smartphone market and then there is the rest of the market that uses the mobile web. We provide that through HTML5 for makers like Blackberry, Windows etc. Their YouTube implementation leverages our mobile website so do other higher end feature phones. For the other phones, we have mobile site that is one step lower and not as rich but it still provides access to the same videos. We are not trying to address each platform individually. However, we are working with handset manufactures to make sure that the specifications for YouTube are on their phones. For example, if there is a new phone coming from Micromax. They would take a look at YouTube.com on the browser and see if it works. If it doesn’t they will call us, talk to us about what the issues are. However, we are not building a different product for each phone. Phones have to leverage the Internet to bring YouTube to different screens across these devices.
Medianama: Are you seeing greater usage on feature phones or smartphones in India?
Varela: Greater usage comes from feature phones. They outnumber smartphones in terms of sheer numbers, 9 to 1 and even those smartphones are not connected to 3G network. 2G network data is far exceeding than 3G network data. The bulk of the traffic is from 2G for YouTube.
Medianama: Do you see wide usage of YouTube even through Wi-Fi on mobile in India?
Varela: I have to look up the exact numbers for India but globally there is tremendous use for YouTube through Wi-Fi on mobile. Obviously, there is better access to Wi-Fi in other countries. I just don’t know what the split is here in India.
Medianama: In India, there has been the problem of net neutrality with operators. They want Google to pay them to provide YouTube to users at particular bandwidth? Did you face this problem?
Varela: I didn’t come across this discussion during this week. Everything was very positive with folks at the highest levels. We saw a lot of enthusiasm and acknowledgement to provide YouTube.
Note: Part 2 of this interview will have inputs on how YouTube views MSO’s, DTH and Cable operators