Microsoft Launches Navteq Powered Maps For India; For How Long?

Microsoft has launched listings and street maps for India, powered by the Microsoft Virtual Earth platform, and with map data from Navteq and the Goverment of India.

In India, the service has street level data for 9 cities, business listings across 29 cities and highway networks to 20,000 cities and towns. Try out the internet version at http://maps.live.co.in and mobile version at http://m.live.co.in

It’s important to note that while, last year, Microsoft had signed “multi-year deal” with Navteq, Navteq itself was acquired by Nokia. This puts Nokia and Microsoft in an interesting competitive situation - since Nokia has its own plans for Navteq, particularly around local information, perhaps extending to location based services. Navteq had launched Maps for India last year.

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At TiEcon2008: On OnMobile, Nokia And Entry Barriers; What They Said, Didn’t Say, And What Can Change The Game

What they said
Cutting a deal with an operator is difficult
Arvind Rao, CEO of OnMobile: In the telco space, winning your first customer is the most difficult thing. Telcos aren’t dinosaurs, but they’re very very complex entities to deal with - they’re risk averse. They’ll say ‘go deploy with someone else show me it works, and consumers want it.’ It’s a chicken and egg problem. You’ll have to wheel, deal, do anything to get your first customer, but be fair and cut a deal that you can renegotiate at a later point. We had access to all the operators through our VC contacts, but we couldn’t get a break.

Scale is an issue, and we’ve already have the distribution, revenue model, and access to the consumer
Arvind Rao: We have our platforms installed in almost all operators in India. We are migrating to a point of opening the platform, and launching the OnMobile Developer Platform. Entrepreneurs can create companies and application, and wont need to go through the hassle of negotiating with operators, discussing commercials and integrating with such huge systems. You can’t manage with 20-25 people - for managing telcos, you need Industrial strength. A telco sent us such a team to us - they liked the technology and didn’t want to deploy, so they asked OnMobile to deploy. We liked the technology, and decided to buy them. So the thing you have to think about is “Why am I doing this? Am I looking to build an institution and a large company? Or something that I’ll sell in 3 years. There is consolidation in the VAS space in India.

What they didn’t say
If you don’t partner, we’ll just take you out
Look at what OnMobile has done in South India - they went into the market, and signed up 40 odd deals with SIMCA, using the money at their disposal to take many of the existing players out. Nokia also has in the works a music service, just as Motorola has MotoMusic. With larger distribution network and operator tie-ups, if you’re not creating exclusive content or have a large community at your disposal, it looks like you don’t have an opportunity in the mobile space.

In a way, Nokia did respond to this situation - very soon the consumer will have to choose between one location based service ad the other. You don’t know who will win. When people approach the same consumer and same market from different sides, they will approach it differently. Internet companies approach messaging from a web base point of view. Operators will approach it from revenue point of view. Nokia looks at messaging as a part of every service that we offer - even N-Gage. When Nokia enters the space, we don’t just look at one payment or distribution mechanism, so there’s opportunity for entrepreneurs.

What can change the game?
Sitting pretty at the top of this value chain, but apparently not-very-interested, are the mobile operators. They’re tedious to work with, but by opening up to smaller players, they can easily take the opportunity away from Nokia, OnMobile and everyone else who’s moving from their traditional role (as a platform company or a handset manufacturer) and to a services role. A step has perhaps been taken in the right direction, with Airtel launching its incubation fund. One opportunity is in going off-portal - whatever their cost of operation, MyToday and SMSGupShup have shown that if you spend big, you can create a large enough consumer base, irrespective of the operators, VAS players and handset manufacturers.

Nokia To Launch Music Store In India In Early 2009

At the TiEcon2008 conference, Vineet Taneja, Head of Go to Market (India), Sales for Nokia disclosed that the company intends to launch the Nokia Music Store in India early next year (2009). D. Shivakumar, MD of Nokia India later confirmed the plans to us, but declined to comment on specifics.

The Nokia Music Store allows users who have purchased a Nokia 5310 or a 3G enabled N95 to download all the music they want, for one full year. They just need to register their phone, and can download the music to their PC, and transfer it to the mobile handset. The service is currently live in Finland, UK, Germany, Ireland, Italy, Netherlands, Singapore, Australia, France, Sweden and Spain.

There are two elements at the core of this launch - the first is the content acquisition, and the other is the distribution. Nokia is already acquiring content for the launch of its Ovi service, though the words “Free Music” will scare away many a content owner. DRM will be key to content acquisition, and an “all you can eat” plan won’t come cheap for Nokia. The other is the distribution - Broadband penetration is abysmally low in India, and Nokia will have to either allow users to download content over the mobile (which will end up being rather expensive for consumers). What will also limit the service, is the fact that it is restricted to particular handsets, so Nokia will use it primarly to sell the handsets.

Note: The access to content for Ovi will also be enabled early next year, Taneja had said.

Nokia Q3 Sales, Marketshare Down; $70 Million In Chennai NSN Facility; Push For Push Email

Handset manufacturer Nokia, which has the largest marketshare in India, warned of uncertainty as it reported a decline in Q3 net sales of 5 percent year on year, and 7 percent quarter-on-quarter. During the analyst conference call, Nokia CEO Olli-Pekka Kallasvuo said that the it is unclear how the global financial situation will impact different markets, particularly since many consumers in markets like China, India, AsiaPac and Latin America have consumers who prioritize their spending; spending from this segment was impacted by high commodity prices over the last year, but that bubble has now burst, with a decline in the price of oil and rice.

Reuters reports that Nokia Siemens Network will set up a factory in India, near Chennai, investing $70 million over three years on the facility. The factory will make and distribute mobile communication equipment.

Nokia’s global marketshare fell to 38 percent (down from 39 percent), though device volumes were down 3 percent sequentially in Q3 at 117.8 million units. While India numbers were not shared, Nokia suggested a 3 percent q-o-q decline in overall handset shipped volumes in the Asia-Pac region. Kallasvuo blamed the decline in marketshare on competitors who “have cut prices to either clear stock, or drive scale. We have not participated in these unsustainable price wars. This time we decided not to participate in the price competition. We will and try and take marketshare in a sustainable manner. We will continue to manage the business tactically, and manage the margins and market share.” According to Nokia estimates, over market volumes were at 310 million unites, up 8 percent y-o-y. Nokia expects a seasonal uptake in Q4 in the device market, but is slightly muted.

Push Email: Nokia appeared to be quite bullish on its Push Email solution: Kallasvuo said that the company has shipped over 1 million units of the E71 - “This is our first true mass market QWERTY device”. They’ve seen a great deal of activation of email with his product, and expect it to be popular going forward. “We are beta testing our consumer push email solution, which we plan to roll out commercially soon. We are going to add more languages.”

Details: Earnings Call, Earnings Call Transcript, Earnings Release, Presentation , Financials

Nokia To Power Ads On Airtel WAP Portal; Ad-Supported Ovi?

Update: We’re been informed that Nokia getting the Airtel account isn’t news either - Enpocket used to power the Airtel WAP portal ad-platform, and Nokia got that account via the Enpocket acquisition. The deal apparently expired earlier this year, and others were bidding for the account.

An industry source gives an example of the calculations on basis of which Nokia might have calculated the guarantee:

There are essentially three variables that will drive the size of the guarantee:

• Projected inventory volume: Assume that Airtel does roughly 50-60 million page views per month on Live!
• Projected fill rate: Assume a fill rate of somewhere between 50% and 70%
• Blended CPM: Assume that Airtel sells much of its inventory at between Rs 100 to Rs 120 CPM.

So, the calculation: 50m – 60m PVs x 50% - 70% fill x Rs 100 blended CPM = 36 – 40 lakhs/month

Note: Please keep in mind that is an example, only for your reference :)

Original story: Well, AdMob, MKhoj and MobileWorx are in for some serious competition in India: we’d heard about companies bidding for managing advertising on Airtels WAP portal “Airtel Live”, and according to Reuters, Nokia has won that account. Nokia had acquired Enpocket earlier last year. Its website now redirects to Nokia Interactive Advertising. This is another instance of the handset manufacture flexing its muscle and expanding up the value chain.

Also makes me wonder if some part of Nokia’s Ovi business (content) is going to be ad supported. They’re tying up with content partners in India, and it might just end up a dud like Nokia Downloads, if usage isn’t driven with either free samples, or ad supported content. More on this later

Nokia Roundup: Tough Q3; Ovi - Phone Backup; Mobisodes

Nokia may have followed up the iPhone hype in India with an announcement of their own - the launch of the N96 - but the company has now said that Q3, globally, for them isn’t looking as good due to “weaker consumer confidence in multiple markets”. Basically, there is a price war at the lower end of the market, and Nokia expects a drop in their market-share; they’re not willing to compromise margins in the segment which defines their profits and volumes. Another comment worth noting - “users in developing markets are taking longer to replace their handsets.” More at Reuters and Bloomberg

On the services side, Nokia has unveiled the new version of their service Ovi, alongwith the Nokia Ovi Suite, which allows users to sync their calendar, contacts, notes and tasks with Ovi.com. This free service is similar to the paid Phone Backup service that OnMobile is offering with mobile operators in India.

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Nokia To Target Rural India Market For Growth, With Microfinance Options, Services

On why Nokia needs the Rural Indian Market

Olli-Pekka Kallasvuo, President & CEO of Nokia was in Delhi to announce the companys plans to launch entry level handsets in India, in order to cater to the non-urban consumers. To facilitate adoption, Nokia will initially offer a base phone with microfinancing options, and is currently running pilots in order to tweak its offering to make mobiles more affordable, reports the Hindu. In terms of services on offer, Nokia is in talks with content providers for information on the weather, and market prices for agricultural products. That’s fairly similar to the Reuters Market Light product which Reuters India has piloted, and I wonder if there’s a tie-up in the offing there.

In Q1 of 2008, around 10,000 phones per hour were shipped to India. Nokia has a significant lead over its nearest competitor - LG. Nokia has a market share of 52.8 percent, followed by LG at 10.2 percent, and Samsung at 8.3 percent in terms of units shipped during the quarter ended March 31, 2008. There are around 25 handset vendors operating in India, and the average selling value of handsets has been steadily declining, according to IDC. However, IDC doesn’t mention how many of the handsets are actually sold.

Handsets are essentially consumer durable items - you really don’t need to buy a new one. The entire handset business is dependent on creating a new need - whether it is a higher resolution camera, more storage capacity, clear music, a slimmer phone, a gold or a pink phone. It is this durable nature of the handset which has driven innovation. From a feature perspective, the urban Indian markets are plateuing (do I really need a camera with more than 5 mega pixels?), and Nokia faces a significant challenge from the iPhone, which Vodafone and Airtel will introduce later this year.

A rural push offers Nokia the opportunity of entering a market that is still in its early stage of growth, and then pushing for users to upgrade their phone, feature-by-feature. Of course, rural markets do not operate in complete isolation to urban centres, but it will take time to plateu. In order to drive this growth, Nokia will have to push consumer adoption by educating users and a significant distribution and service push.

Update: As Shefaly rightly asks in the comments to this post, what does Microfinancing refer to in this context? Nokia is studying means of making it easier for rural consumers to purchase mobile phones, probably with Equated Monthly Installments (EMIs), or some tie-ups to reduce the cost of purchase. This is different from the Microfinancing that one associates with the Grameen Bank.