One of the cardinal rules of PR is this: “Never become the story”

But thanks to a raging fight between the Hanmer MSL, the flagship brand in the MSL Group’s Indian portfolio of communication agencies, and the PRCAI, the umbrella body that represents all PR agencies in India, it’s a little too late for that.

“They’ve violated the spirit of business. Some of our member companies have received legal views that what they’ve done is defamatory,” says Sharif Rangnekar, the head of PRCAI and of Integral PR, one of the still independent PR agencies with some critical mass.

But Jaideep Shergill, Hanmer MSL’s CEO, says he is surprised with PRCAI’s questions. “We did it because nobody else was doing it, and because we wanted to educate everyone in the industry. We didn’t do it for ourselves.”

The bone of contention, if I can call it that, is this – “Understanding the Public Relations Industry in India: Challenges, Opportunities and 2012 Outlook” (PDF).

The 24-page report was brought out by Hanmer MSL in early January upon which it was promptly picked up and reported by The Holmes Report which wrote:

Reports of this nature are usually blighted by a heightened sense of caution, with firms afraid of offending clients or discussing their peers (to say nothing of Sarbanes-Oxley concerns). That this study shows so much less of this restraint should probably be welcomed.

The report’s unnamed authors first went on to pour some (refreshing, I might add) cold water on the prospects for PR in India. The ills cited – an over reliance on “media relations”, extremely low fees, inability to attract or retain talent and lack of emphasis on training – were by no means new.

In fact I had written about them exactly a year back in the magazine, with the hope that the entry of numerous foreign agencies might cause the situation to change.

In many ways, that environment remains but change has begun to happen. A wave of international firms is sweeping over India’s shores. They see the potential to take the business of public relations to a more professional, systematic and pro-active level. They are trying to shake up a smug Indian industry used to treating PR as a minor cost centre focussed on managing a few journalists; and help it prepare for a more assertive and connected consumer base. In the process, PR is becoming a more strategic but expensive affair for companies.

All of these issues are well known about agencies and clients, so no surprises there in the report.

Maybe the report’s authors got carried away with all the candour – often a very scarce commodity in PR – because they then went on to deflate the size of the industry down from the $6 billion that an Assocham study had estimated and the PRCAI too had quoted in its May 2011 report titled “Public Relations Practice – Ground Realities” to $140 million.

Now we all know that industry estimates are notoriously unreliable and must hence always be viewed with some margin for error. But according to Hanmer MSL the margin was 96.7 percent!

Hence, there’s a vast gap between what the market says and what independent surveys claim.
There’s more supporting evidence. Many independent surveys say the size of the Indian advertising industry is Rs 10,000-12,000 crore ($2.2-2.5 billion). This begs the question, how can the PR industry, which is much smaller, clock Rs 27,000 crore?

By now the authors must have been on a roll, because they decided to go for the jugular – individual financials for most of the large firms.

These are the top five and their estimated revenue, according to it:

1. Adfactors, $13 million
2. MSL Group India(Hanmer MSL and 20:20 MSL), $11 million
3. Concept PR, $7 million
4. Genesis Burson-Marsteller, $6 million
5. Corporate Voice Weber Shandwick and Edelman India, both $5.5 million

Now that set the cat among the PR pigeons!

Rangnekar first dashed off an angry letter to the MSL Group CEO Olivier Fleurot, asking for the estimates of agency revenue to be “retracted”.

Firstly, he says, “the figures are, according to our members, inaccurate and quite far off from the reality”, including those of his own firm, Integral PR ($3 million).

Secondly, Rangnekar says Hanmer MSL’s revenue estimates had no legitimacy because it was an interested party itself.

Lastly he says Hanmer MSL made no effort to validate its estimates by either contacting the PR agencies themselves, or even by viewing mandatory declarations filed by the agencies with the Registrar of Companies.

When I ask Shergill about these points, he says, “Estimates are estimates. We collated these from company websites, research reports, industry people and newspaper articles. We don’t expect the information to be accurate, nor are we claiming that they are.”

That sounds surprisingly shoddy, for an agency that highlights the following as an “opportunity” in the same report:

Transparency and reliability
PR measurement should be transparent. For media measurement, mention clearly the source along with analysis methodology.
For surveys, make clear the methodology (sample, margin of error, geography, etc), the questions (wording and order) and statistical methodology (how specific metrics are calculated)

Physician, Heal Thyself?

While I admire Hanmer MSL’s honestly in laying out the industry’s challenges in plainspeak, unfortunately it compromised the integrity of the report by not being diligent and transparent enough about all of its contents.

From the same report:

Most experts agree that the PR industry has a PR problem. Many stakeholders, including media and businesses, think of the industry as one large spin doctor.

[...]

Many of the industry’s problems are  self-inflicted. If clients don’t understand the value of PR, the industry is clearly not telling the story well enough.

It’s ironic that a report that sought to address issues like these ends up repeating the same mistakes.

And my advice to PRCAI which is still waiting to hear back from the MSL Group’s CEO on its demand for the revenue figures to be “retracted” is another cardinal rule of PR: “Once information is public, it can never be retracted.”

I’d view this as an opportunity for PRCAI to bring out its own impartial, transparent and level-headed analysis of why and how the Indian PR industry needs to get its act together.

Just when you thought Indian Telecom finally had a chance to make a clean break from its past, Boom!

Via these two interesting articles in Business Line and Rediff comes along the latest case that seems destined to carry on the unsavory legacy of Indian Telecom regulation.

Firstly, Thomas K. Thomas of Business Line writes that Reliance Industries Limited, the sole winner of pan-India broadband wireless spectrum in last year’s auctions, is requesting that the tenure of its license be increased for another 18 months beyond the original 20 years. Why?

“Qualcomm had won the airwaves during the auction held in 2010 but DoT has not yet awarded the spectrum to the US firm due to issues with its application.

According to RIL, the delay in getting the spectrum has ironically worked out to the benefit of Qualcomm as the US chipmaker will be able to offer services for a longer tenure. RIL has pointed that while its spectrum will be due for renewal in 2030, Qualcomm will be able to offer services beyond that since it is yet to get its licences.”

In October last year we had written about RIL’s plans to build India’s first 4G broadband wireless network. After missing its first launch date of December 28, the late Dhirubhai Ambani’s birthday, RIL had set its sights on launching during the middle of 2012. That date has now been pushed even further, according to the industry chatter (when it comes to RIL and its plans, there’s an unwritten code of “Omerta” followed by all partners) and now stands nearer the end of 2012.

Even then, there doesn’t seem to be any signs of a competitor.

Firstly, Qualcomm is still battling to have its licenses cleared. The Department of Telecom, that beacon of transparency and effectiveness, is foisting demand upon demand of backdated tax claims on Tulip Telecom, one of Qualcomm’s Indian partners in the 4G joint venture. From the Rediff article by Paranjoy Guha Thakurta,

“On November 30, 2011, the DoT raised a demand on Tulip for dues of Rs 146 crore for the assessment years 2009-10 and 2010-11.

A shocked Tulip then filed a representation with the DoT to re-evaluate these demands. Tulip’s argument was that the revenue emanating from its non-licence business had been added to its licence revenues for calculating licence fees.”

[...]

“Qualcomm waited for Tulip to settle these issues with the DoT but, after a while, offered to clear Tulip’s dues by giving an undertaking or a bank guarantee to pay in case Tulip did not cough up the money. Qualcomm’s new offer was made through a fresh petition filed on January 23, 2012.

The DoT was supposed to respond to the Qualcomm offer within seven days and discuss the issue on January 31 this year.

The DoT’s counsel informed the TDSAT that he had no instructions and would require more time to reply. The matter to be heard on February 6, when the DoT’s counsel said that he still had no instructions from his client (the DoT) and got an extension till February 13, 2012.

Curiously, on the day of the TDSAT hearing, on February 6, the DoT faxed a fresh demand of Rs 264 crore (Rs 2.64 billion) to Tulip for the financial years 2005-06, 2006-07, 2007-08 and 2009-10. Tulip had presumed that the dispute had been settled for at least three of these four financial years.”

So in the lucrative circles of Delhi and Mumbai – together representing the most profitable and earliest adopters of 4G broadband – Qualcomm is still waiting for spectrum in spite of paying over $1 billion for it. That means Airtel, the current Telecom leader cannot buy those licenses out to offer its own services. Neither can any other operator, because guess what, the DoT has in its infinite wisdom ruled out sharing of 3G (and naturally, 4G) spectrum between operators.

Which rules out the first of RIL’s two possible competitors (three slots of spectrum had been auctioned in most circles, and four in a few).

Meanwhile BSNL, the state-owned operator that was supposed to be the second competitor to RIL, has “returned” its spectrum back to the government. That spectrum is now due for auction, whenever that is.

Which is why its perplexing to see RIL – the only company with 4G wireless spectrum all over India, and an effective monopoly in most lucrative markets – complaining to regulators about how Qualcomm has been given an unfair advantage!

But then, stranger things are known to have happened in Indian Telecom.

Meanwhile, do try to pick up the latest issue of Forbes India from the stands. Aside from the meticulously researched and expansive report on Innovation put together by my colleague Seema Singh, there’s a series of articles put together by me and Forbes India deputy editor Shishir Prasad that argues in favour of a “New Deal” for Indian Telecom just like the original put together under Franklin Roosevelt for America in the 1930′s.

Tulip's Next Big Bet

Good news and good sense are usually in short supply in the unpredictable world of Indian Telecom.

Courts cancel licenses en masse, balance sheets bleed red from sky high debt, regulators fiddle while the sector burns and most consumers can’t seem to find a mobile connection that lasts through a call.

But far from the madness of it all, behind a long road flanked by concrete-and-glass structures and young technology professionals smoking in small huddles outside them, stands a massive building that may be the best news I’ve seen in a while.

Surrounded by electrified intruder-sensing fencing, recently transplanted palm trees and a phalanx of security guards, it is the Tulip Data City – a massive data center measuring nearly a million square feet, making it Asia’s largest and the world’s third largest. The hulking tower can seat 12,000 server racks and over 1500 people, using up nearly 100 MW of power at peak in the process.

It’s owned by Delhi-headquartered Tulip Telecom, a company that has cannily and progressively moved up the Telecom value chain in India since getting its first big break in 2003 installing wireless radios in Kerala’s Malappuram district. I first wrote about Tulip and Col. H.S Bedi, the retired Army colonel who heads it, two years back.

Back then the surprisingly foresighted Bedi was just beginning to transition Tulip from being primarily a low-bandwidth wireless connectivity provider to a high-bandwidth fiber-optic enabled one.

Bedi’s goal was to introduce his own fiber-optic connectivity first in the central business districts (CBDs) of India’s leading metros, and then the top 100 cities. Doing so would allow Tulip to become a more complete telecom services provider to enterprises, in many cases competing directly with the likes of Bharti, Reliance Infocomm and Tata Teleservices.

When I met him yesterday at his newly inaugurated data center, I asked him how the plan had fared.

“We had initially planned to connect just the CBDs but found the demand so strong that we laid over 20,000 km of fiber-optic covering 300 cities. That gives us the largest intra-city (within a city) fiber network in India,” he said.

From Fiber to Cloud

With the addition of the massive data center, incidentally it’s fifth, Tulip is now attempting to segue into the next higher level of services in Telecom: managed services and data centers.

“Over 75 percent of the Forbes 500 list are now our customers. And many of them don’t want to deal with multiple vendors for connectivity and infrastructure,” says Bedi.

By vendors he means managed infrastructure providers like HCL, Wipro, IBM and HP.

“Because they are not telecom providers, they cannot legally sell bandwidth to customers. So if a customer has to choose either us or them when trying to reduce their vendors, it has to be us,” he says.

The Bangalore data center is Tulip’s Rs.900 crore (that is the amount it is estimated to have spent on it) wildcard entry card into this game.

Through it Tulip plans to offer a suite of infrastructure services like managed services, network security, server hosting and soon, its own cloud offerings.

Analysts expect the third-party data center market in India to grow at a compounded rate of between 25-30 percent over the next five years, thanks to robust demand from virtually all major sectors. Reports also suggest Tulip is expecting a steady state revenue of Rs.950 crore from the data center, which should happen in four years.

Asset-Light, Common-sense Heavy

Though Tulip’s bets appear audacious, in reality they are often conservative and textbook examples of expansion.

“My business model always has been that investments should follow (customer) orders,” says Bedi.

So unlike most of his peers who invest billions of dollars in pursuit of often ephemeral markets, Bedi prefers to line up customers for Tulip’s services before incurring the capital expenditure for the underlying infrastructure.

So it scopes an anchor customer for its connectivity in a new city before spending 1-2 months laying down the fiber-optic that will deliver it. And instead of spending serious money laying inter-city (between cities) fiber-optic, it cannily chose to lease that capacity from other operators thanks to the glut in supply there. In contrast, intra-city fiber is usually in short-supply.

As a result of these moves, Tulip has been able to increase its addressable market tenfold from Rs.1400 crore to Rs.14,000 crore within just 3-4 years.

What is Tulip’s expansion strategy, I ask Col. Bedi. “We prefer to keep learning on the ground while moving forward,” he says.

Visitors to the website of TRAI, India’s apex Telecom regulatory body, are first subject to a splash screen featuring a black and white photo of Mahatma Gandhi speaking on a telephone. Underneath it are printed the following words, in bold type, “Truth Alone Triumphs.”

But for many years now that photo and message have signified nothing but irony, even a perverse sense of humour, for most visitors thanks to the rotten state of regulation in the world’s fastest growing telecom market.

Till 2nd February, that is. Because that’s when India’s Supreme Court delivered a resounding judgement cancelling en masse 122 licenses issued in an arbitrary “first come, first served” manner by erstwhile Telecom minister A.Raja, who is currently under imprisonment in Delhi’s Tihar Jail. Here’s the full PDF text of the judgement, worth saving and going through due to the immense ramifications it will have on this sector for years to come.

While such large scale cancellation of licenses was in itself a major decision, there was another even bigger bomb hidden in the judgement: “while transferring or alienating the natural resources, the State is duty bound to adopt the method of auction by giving wide publicity so that all eligible persons can participate in the process.”

The Intelligence of Markets

By specifying the auction as the preferred way for the State to allot precious and scarce natural resources – of which radio spectrum is a prime example – the Supreme Court has indirectly favoured the intelligence of markets versus that of ministers, bureaucrats or industry experts.

“When you pay a price for something, it automatically ensures efficiency,” says Alok Shende, Principal with telecom consulting firm Ascentius.

There were immediately some cries of alarm. In an unsigned editorial, The Economic Times, India’s largest business newspaper, called the Supreme Court’s preference for auctions “a simplistic assumption devoid of economic analysis.”

“Low-cost telecom spreads fast, increasing, with each additional connection, the utility of being connected for everyone on the network. The result is efficiency and productivity gains across the board, leading to faster economic growth. Crores of lives improve and the government nets superior tax receipts, far in excess, over the years, of auction proceeds. Auctioned spectrum jacks up the telecom industry’s capital costs, which will either raise tariffs or delay further expansion and upgradation.”

Why not distribute spectrum through a draw of lots, among financially and technically qualified aspirants, asked the editorial.

Why indeed? Here are a few:

• In no market are all aspiring participants equally capable. While they all may be financially and technically above the minimum cut-off threshold, some will be better at converting allotted resources into consumer services than the other. So spectrum will be far more productive in Bharti Airtel’s hands than in, say, Videocon’s. A random draw of lots does not guarantee that.
• Practically no one today – Indian or foreign – has any confidence in any “draw of lots” that will be conducted by Indian Telecom regulators, no matter the oversight or audit controls they bring in.
• In any auction, rational bidders ensure that their bid prices take into account future profits as well. There is no need for the State to be concerned about that.

Unfortunately in Indian telecom, things have been purposely muddied for so long, that even rational and publicly-listed operators like Bharti Airtel have ended up “over bidding” during auctions.

For instance industry experts tell me that 3G adoption among consumers is so abysmal in India today that most operators who spent billions of dollars on it aren’t even able to service the interest on their debts from customer revenues. Which is the reason why we’re seeing a gradual increase in the prices of 2G voice services.

“All the big operators are making money on 2G, so there is no reason for them to hike prices further. Yet they continue to keep doing so, because their balance sheets are saddled with 3G debt,” says a partner with a strategy consulting firm who did not want to be quoted directly.

But the fault for that doesn’t lie in auctions, instead in the deliberately unpredictable nature of Telecom regulation till now.

Taking Regulation Back to the Drawing Board

The reason sane firms end up overbidding in Indian telecom auctions is because they have no visibility into the future roadmap. So when an auction comes round, everybody piles on, not knowing when the next batch of spectrum will be made available.

The troika of TRAI, Department of Telecom (DoT) and Ministry of Communications have over the years created a climate of opacity and randomness, that practically no operator, large or small, can take anything for granted.

In light of the Supreme Court order, might we suggest they genuinely revamp the sorry state of Telecom regulation in India?

A starting point could be the US telecom regulator, the FCC. Head over to the section titled “FCC Reform” on its website, and you can have a look at various elaborate tools that explain how the sector operates.

There’s the “Spectrum Dashboard” that allows anyone to graphically view and analyze the allotment of hundreds of different spectrum brands, including who own them and to what use they are being put to.

In India that process is managed by an arcane group within the DoT called the “Wireless Planning and Coordination Wing” which mostly prefers to keeps its cards close to its chest.

Imagine if there was a web-based, easy-to-understand spectrum map for India that not only shows who owns and does what with various spectrum bands, but also what spectrum is likely to come up for auction during the next few years. Operators can confidently plan their future strategies knowing what resources they have the potential to buy, leading to much more rational prices during auctions.

FCC’s “Data” initiative exposes to citizens and developers tons of data from its underlying databases, including tariffs, fees, equipment authorizations and radio call signs. It encourages software developers to build applications that access this data to present information in innovative ways to consumers.

In comparison, information about Indian Telecom regulation is hidden inside hard to read PDFs across multiple websites, often just typewritten notes that have merely been scanned.

Imagine if all decisions, orders, applications and reported data is electronically stored into databases, open to any citizen through a web browser or software developer through an API?

Another regulator whose work is worth looking at is UK’s Ofcom. It’s Spectrum page is a great resource for operators to understand its philosophy and spot opportunities to acquire additional spectrum, through auctions.

In addition to the list of bands that are currently being auctioned, Ofcom has also listed bands that will come up for the same in the future.

While Indian newspapers occasionally publish rumours or unconfirmed reports of spectrum being made available in India, especially in the lucrative “digital dividend” band, iImagine if regulators could publish the same in a timely and transparent manner on their website?

Re-imagining Telecom

The Supreme Court’s direction on having auctions determine allocation of resources in spectrum has the potential to change many equations within Indian telecom.

Spectrum Allocation: assuming the government is unable to impress upon the court, through an appeal, to reconsider its decision, we will see over 500 Mhz of spectrum becoming available for auctioning after 4 months (the period determined by the court).

All talk of a “base price” of over $2 billion for 6.2Mhz of spectrum should be thrown out the window. Simply because those prices aren’t realistic in today’s economic environment and Telecom sector. The classical idea of a reserve price was to discourage frivolous bidders, but over the years governments across the world have jacked up prices many times over, usually by benchmarking it to frothy past auctions.

But in a sector saddled with too many players, too less innovation and bloated balance sheets, high reserve prices can act as a deterrent for new and existing players. And spectrum is a perishable commodity in a sense, meaning any that isn’t auctioned or used, is essentially waste and serves no economic benefit to society.

Our regulators would do well to understand that their long term objective is to create a vibrant, competitive and healthy sector instead of maximizing the revenue from one auction.

So bring down reserve prices, allow all serious and qualified players – domestic or foreign – and let the market determine the correct price.

Mergers and Consolidation: It’s actually a travesty that in a telecom market as large, growing and competitive as India, we haven’t see any meaningful mergers for so long. Our short-termed regulators have ensured that far too many competitors were wasting effort and capital copy-pasting the exact business models of earlier players. Its no one’s case that consumers vastly benefited after the entry of many new operators since 2009. The market share of all 122 licenses that were cancelled amounted to roughly 5 percent.

India’s existing M&A policy and approach has been to discourage mergers, by setting impossible conditions around combined market share that seem targeted at preventing all economically-sensible mergers. In cases where combined market share is okay, our regulators impose artificial limits on the spectrum that the combined entity can hold.

Here’s a thought: how about devising an M&A policy that encourages mergers? One that understands that an operator that is being sold, is being done so for its customers, brand and spectrum.

Future Technology Roadmap: Time and time again Indian regulators have been found wanting in their knowledge of how telecom technology evolves, be it GSM vs CDMA, 3G vs. 4G or Wimax vs. LTE.

So the conditions imposed on 4G winners last year prohibit voice, even though LTE (the technology that has been chosen by all winners) can allow voice calls in addition to data.

The next version of LTE, called “LTE Advanced”, will allow for use of non-contiguous spectrum, meaning isolated chunks combined together. Our regulators cannot even value or allot such spectrum currently.

But there are regulators who can. The US FCC recently announced public trials of “Super Wi-Fi”, a new technology standard that allows for fast broadband transmission over unused “white space” frequency between TV channels.

A great example of how to do this is much smaller Singapore, which publishes extremely well researched and long term roadmap reports.

Encourage Diversity: Although India has the distinction of being the telecom market with the most number of competitors, it is a rather dubious one. Simply because the competition is quite homogenous, with most operators only varying by minor degrees in service levels or prices.

Instead, allow a newer set of players.

MVNOs are operators who lease spectrum and/or infrastructure from other operators to offer their own services. Though Indian regulators have never quite banned MVNOs, they haven’t explicitly allowed them either. “MVNOs allow those operators with unused spectrum to derive a market price for it,” says Shende.

The other side of MVNOs could be wholesale telecom providers. The best example of that (notwithstanding their current spectrum clash against GPS devices) is Lightsquared, a US company that is building a $7 billion nationwide 4G (LTE) and satellite network that it will offer only to other operators.

What prevents our regulators from allowing such competitors?

So while the Indian newsmedia is in a huff over the Supreme Court decision to cancel all 122 telecom licenses granted by erstwhile telecom minister A.Raja, their Twitter and blogger counterparts are getting all worked up because Amazon has dusted up a service they bought 14 years ago and launched it in India – Junglee.com.

Originally launched as a price comparison engine by a bunch of sharp Indian engineers – Venky Harinarayan, Rakesh Mathur, Anand Rajaram, and Ashish Gupta – Amazon bought out the company in 1998 for nearly $200 million.

While the core technology got assimilated into Amazon’s own services, the brand was forgotten about and duly consigned to the footnotes of Internet history. Till today that is.

Junglee.com has been launched by Amazon specifically to target the Indian market. Minus all the hype around the announcement, it is just a cleanly designed product comparison service. You can browse or search various products like books, mobiles, toys, baby stuff and computers. Junglee will show you which retailers – online or offline – offer the product, at what prices and on what shipping terms.

That’s it.

It’s up to consumers to then complete the purchase either by visiting the third party websites like indiaplaza.com or firstcry.com; or through physical retailers like Bata or Fabindia.

There are already a plethora of such services in India, notable amongst which are naaptol.com, tolmol.com and compareindia.in.com(disclosure: a Network 18 company, the same company that runs Forbes India).

Worse, the best known ecommerce sites in India like Flipkart.com, Myntra.com, Infibeam.com and Letsbuy.com are, not surprisingly, absent from Junglee.

Of course it’s easy to figure out why that is so. All these sites have spent precious money and effort over the years to become well known brands and build their own loyal customer base. Why would they want to become just a “supplier” on an Amazon site, competing against any number of random competitors on (usually) just price?

Conversely, why would Amazon genuinely want to funnel more sales to brands that it will inevitably have to compete with in India?

Mind you – India is absolutely critical for Amazon as I had argued in an earlier story in Forbes India.

Much Ado About Nothing

While I haven’t got any insights from Amazon on their Junglee launch (the company is notoriously guarded about revealing its plans, like Apple. It hasn’t acknowledged multiple requests I’ve sent in the past for comments on stories), I don’t think it is that significant a step for Indian consumers.

That’s because the things Amazon is well known for – world-class service, an infinite range of products, super fast shipping or fantastic product reviews – will not be available through the Junglee service.

Worse, those customers who end up using this service to find and order products will in many cases end up with sub-optimal service and shipping delays because the sellers aren’t exactly best-of-breed.

I’ll even submit that there might be a negative rub-off on Amazon when customers end up having bad experiences after having found and purchased products through Junglee. Granted Amazon can always say, “Look, we are only pointing out stores to you. After that you’re on your own!” but the human mind isn’t always rational. Consumers will expect some ownership from Amazon for this service.

When that happens, what do you think they will do?

They will realize that shopping through a marketplace doesn’t always guarantee the same service levels or experience as doing so from respected brand. The same reason why most of us prefer to shop from Amazon instead of Ebay.

So why is Amazon doing this?

Junglee Trojan?

The FAQs for Junglee mention that in addition to Indian retailers, the service will also ship from Amazon.com.

Check out the seller results for the Nikon Coolpix L120 digital camera.

8 Indian sellers offering the camera for between Rs.12,438 and Rs.13.530 and delivery ranging from 1-3 days and 4-7 days.

And Amazon.com offering the same for Rs.9,836 in 3-5 days, albeit exclusive of shipping and custom fees. Inclusive of those the price ranges from Rs.13,676 to Rs.15,294, depending on the shipping times chosen.

Those prices can come down significantly once Amazon decides to charge less for shipping, as it is a past master of lean and fast logistics.

But guess who was selling the camera to me?

You’d think it was another third party seller, via Amazon’s well established Global Program, right?

The seller is “Amazon Export Sales, Inc.”

For the slightly well-heeled, ordering from Amazon.com and shipping to India was always an option.

Now through Junglee, Amazon will be able to push those to a wider audience, using Rupee prices. With volumes it will bring down shipping prices too such that the differential between ordering from an Indian retailer and from Amazon will become minimal.

Of course this isn’t Amazon’s endgame. Shipping products internationally still takes more time and more money (thanks to custom duties). But its a good way to progressively ramp up in India.

“Google, what were you thinking?“ went Stefan Magdalinski, the CEO of Mocality, on his company’s blog on 13th January. Mocality is Kenya’s largest online business directory.

Mocality has built a database of over 170,000 Kenyan businesses painstakingly over the years, in part of offering cash incentives to businesses (about $100,000 in the last two years alone).

In the long and detailed post, Magdalinkski explained how Google Kenya had been systematically scraping this database and then having employees call them up to offer its own paid website hosting and domain services. Worse, the callers claimed Mocality was a partner to Google.

Incidentally, many of these calls were coming from Google India.

Thanks to Mocality’s well-thought out and documented effort to bait and trap Google in the act, it had no way out than to accept the charge and offer an apology. In a public Google+ post the company apologized to Mocality, laying the blame on a few contractors working for it.

Three days later, on 16th January, OpenStreetMap, a free and community-edited global map project that competes with Google Maps, reported instances of unknown people vandalizing its map database. Though not anywhere as widespread or systematic as the Mocality incident, the vandalism involved deleting or moving map data and mischevious acts like reversing the directions of one-way streets.

Once again, the culprits turned out to be from Google India.

And once again, Google owned up to the act and pinned the blame on contractors as first reported by Stephen Shankland, a CNET writer. T.C Sottek of The Verge went on to quote unnamed sources saying the contractors had also been fired.

Is it too much of a coincidence that different Google India teams were involved in unethical acts within days? Specifically, was it a problem with contract employees?

Paroma Chowdhury, a Google India spokesperson, refuted the latter point saying employees and contractors were treated and trained pretty much the same way at Google. There are over 2000 employees at Google India and an unspecified, though “significant” number of contractors. Collectively they work on most of Google products.

What I would be curious to know is what was the brief given to the Google contractors in India who were editing OpenStreetMap data? Google has its own product, Map Maker (which incidentally started out as a test project from India), that competes directly with OpenStreetMap. So why were its workers modifying a competitor’s raw data?

Some people have pointed out that Google is a “supporter” and “sponsor” of OpenStreetMap, but I think “competitor” beats both those definitions.

Google is keen to mention that both of these were isolated incidents by rogue contractors, linked together only due to the coincidence of being a few days apart.

I spoke to Mocality’s CEO Stefan Magdalinski yesterday and he refused to buy the “isolated rogue contractor” theory for what happened to his company.

“While the OpenStreetMap incident may have involved lower level contractors in a few instances only, in our case nearly 30 percent of the customers in our database (170,000) were contacted. I want to know who at Google took a call on this operation, or who ought to have known about it. Google had told me they would investigate and get back to me with an explanation by Monday (16th January) but I’m still to hear from them,” he said.

While Magdalinski waits for an explanation, Google has suffered a significant dent to its credibility in the tech community. And this after the terrible incident where Google was caught running a paid-links campaign for its Chrome browser which violated its own guidelines.

In that instance Google came out respectfully by punishing itself – relegating its Chrome page much lower down search results.

And, oh, in case you were wondering, “Hebdomada” is “week” in Latin.

An 1882 painting by artist Albert Robida imagining a futuristic view of air travel over Paris in 2000.

It started as an innocuous discussion thread on the Forbes India email list. My colleague N.S Ramnath posted a link to a BBC News article about how in 1900 John Elfreth Watkins, an unknown civil engineer in the US, uncannily predicted many things that would come true within a 100 years.

The predictions ranged from digital colour photography to mobile phones to the rising height of Americans.

After a few comments from colleagues marveling Watkins’ eerily prescient predictions, our deputy editor Shishir Prasad weighed in with his own prediction: “Rohin will diss this in the next post!”

And sure enough, I did. (to paraphrase the Oracle from The Matrix, would I have dissed it if Shishir hadn’t said anything?)

While agreeing that Watkins had done some nifty Nostradamus-channeling, I felt that predicting the future so far out wasn’t that big a deal. Half the stuff is already been done by science fiction writers and Hollywood directors. The rest can be extrapolated by any reasonably intelligent and well-read person.

To prove my point, I put forth my own list of predictions for 2100:

- Human beings will live to 150 using medical advancements

- We will communicate with people around the world instantly, and without using any aids(embedded chips that read our thoughts and transmit them)

- Machines would have become sentient, with a collective and individual intelligence of their own(singularity)

- Sex, both for procreation or pleasure will become very rare(super efficient IVF that guarantees perfect children; avatars/humanoids /virtual reality for pleasure)

- Physical travel will be unaffordable for most people, unless you’re mining on Mars.

- Our diets will consist of man-made tablets, powders, juices.

- Natural fruits and vegetables will be more for the gazillionaires.

- Knowledge will be implanted/transferred to our brains.

- People will have multiple life-like holographic avatars that can perform tasks for them simultaneously, often with other avatars.

- There will be one global currency, of which there will be no physical variant.

- Programmers and hackers will be the investment bankers and bankers of then.

Ramnath then raised a very valid objection to my list, saying “If people agree with your list, you are probably wrong. In the sense, it might not take 100 years.”

He was right. Many of the things I talked about, for example about thought-based communication, programmers becoming the new global brahmins and personal avatars might not take 100 years to materialize.

IBM says mind-reading machines might become reality as early as 2017. According to the WaPo, programmers are already the political elite. And one of the predictions made by Prof. Lynda Gratton of the LBS in her very interesting book, “The Shift: The future of work is already here” (which incidentally, I’m currently reading), virtual avatars and agents will already be performing much of our work by 2020.

So I took another shot at my predictions, pushing the boundary of my thinking to hopefully a point where others would find them implausible, and therefore possible.

- Mankind would have engineered a third sex – neither/both man and woman – combing the (cliched) strengths of men(e.g. spacial correlation) and women(e.g. EQ).

- Children will be born inside newly grown surrogate clones, who will be discarded after birth.

- There will be no states by large corporations who control everything.

- The same states will auction the right to have children(not to bear them), but only the very rich will be able to afford them.

- Our home interiors will be made of shape shifting materials that will rearrange to form newer shapes depending on designs fed to them. For instance your living room may be a beach with a beach chair one day and a meadow with a view of the swiss alps another.

- We will be completely and utterly self sufficient on energy(solar), food(artificial), water(desalination) and population(seriously below threshold rate). Mankind will then be pointless and aimless.

Do they sound more outlandish compared to my first set? Possibly.

Here’s when our resident social media editor and nocturnal man-of-words Peter Griffin chimed: why not ask Forbes India staff to add their own predictions to this list, then have our readers rank those ideas and make some predictions of their own.

Sounds like a plan, Peter!

Watch the Forbes India blog pages over the next few days on how to join us in this interesting exercise.

Edit: Readers are welcome to add their predictions or critiques as comments to this post too.

As the last day of 2011 drew to a close, employees of large retail chains like Big Bazaar, Spencers, Reliance Fresh, More and Spar were busy putting up notices near all of their billing counters.

They all said, “From 1st Jan 2012 we will not be accepting Sodexo/Ticket Restaurant vouchers for any purchases.”

This sudden and seemingly coordinated decision by all retail chains to stop accepting these food vouchers has put the two French companies that offer these vouchers – Sodexo and Edenred – on the defensive. Though I could come by no official estimates, at least two experts who spoke on the issue to me on background estimated the size of the meal voucher market in India at around Rs.3000 crore annually.

And though both Sodexo and Edenred have other revenue streams in India like facilities management and in-premise catering,meal vouchers are estimated to account for a bulk of their revenue. A Business Standard story in Nov 2010 estimated that 65 percent of Edenred’s India revenue came from vouchers.

These vouchers, originally a way for employers to offer employees a Rs.50 tax free meal(up to two can be provided per working day) outside office, over time became a parallel currency that could be used to pay for practically anything sold at a grocery store.

So from 1st Jan as the conversations started traveling around office water coolers and Internet forums, Sodexo and Edenred scrambled to email employees of client organizations, reassuring them that between 10,000-20,000 outlets across India still continue to accept the vouchers. With the exception of cafes and fast food chains like Cafe Coffee Day, Domino’s, Subway and a few retailers like Nilgiris and ‘In & Out’, it’s mostly a long tail of small stores on that list.

Most employees aren’t convinced, because they’re used to doing their food and grocery shopping in modern hypermarkets and supermarkets, not at the neighbourhood kirana store. Very few are going to change their shopping habits around voucher acceptance.

Uncoordinated Coincidence

In spite of the seemingly coordinated decision by practically all large retail chains to stop accepting these coupons from 1st Jan, they are very keen to suggest exactly the opposite.

The retailers maintain that this was not a coordinated move, and that their apex body – the Retailers Association of India (RAI) – was not involved at all. The stock answer being given out by each retailer is this: the administrative cost of accepting and processing the paper vouchers was too much for them. And hence, each of them independently seemed to have arrived at a decision to stop honouring them. From the same day.

But background chats I’ve had with experts suggest that the real reason is to put pressure on Sodexo and Edenred to reduce their commission rates.

The way the meal voucher market operates is like this: Sodexo and Edenred market their vouchers to employers, who then pay them the full value of vouchers procured for their employees.

The employees use them at stores, who have to then send back the vouchers to Sodexo and Edenred to get back cash. Except, retailers get back anywhere from Rs.94 (the smaller retailers) to Rs.96.5 (most large retail chains) of every Rs.100 that was spent by a customer. That too, after a credit period of 30 days.

When the meal voucher market kicked off in India, most retailers were concentrated primarily on growing their topline (i.e. revenue). But over the years as competition, and now a slowing economy, has taken a toll on their profits, the focus for them is shifting to the bottomline (i.e. income).

Paying 3.5 percent to Sodexo and Edenred while operating around gross margins of 7-8 percent is something that most retailers aren’t kicked about. The next closest benchmark are credit card companies who charge around 1-1.5 percent.

The decision to stop honouring Sodexo and Edenred vouchers were hence a shot across the bow of those companies, pressuring them to lower commission rates.

But if just one retailer stopped accepting these vouchers, customers would merely shift to others who would still accept them. Hence the seeming coordination.

So why is everyone so eager to suggest that it isn’t coordinated?

The three letter acronym that most likely explains this uncoordinated coincidence is the CCI, or the Competition Commission of India.

There’s no doubt that consumers are being inconvenienced by this move by large retailers. It’s also quite possible that if things don’t change, many employees and companies might stop collecting meal vouchers altogether.

Collusion isn’t something the large retailers want to be drawn up for, especially by an increasingly aggressive and proactive CCI.

It’ll be interesting to see who blinks first in this stand-off. Will it be the retailers, under threat of collusion and anti-consumer behaviour? Or will it be the French giants, whose voucher business might start collapsing as companies and employees find them less useful for purchases?

I suspect it’ll be the French.

So expect this situation to sort itself out in a month or two at best, with reduced commission rates for large retail chains. Will that lead in turn lead to a demand by smaller stores too? Quite possible.

On a surprisingly warm afternoon early-December afternoon in Bangalore, I land up at the offices of Karbonn Mobiles to meet its chairman, Sudhir Hasija.

I look around the narrow street where it’s supposed to be, and find nothing but a small ground floor office in an unmarked building. Above it there’s an unremarkable board with Karbonn’s logo but it looks so much like an afterthought that I wonder if I had mixed up the address and landed up somehow at one of the company’s distribution centers.

I’m wrong. The nondescript building is the headquarters of India’s fourth largest mobile phone maker by volume, as per Gartner. That was my first surprise of the day.

After a wait, I’m shown in to Hasija’s cabin. We start talking but are interrupted within minutes by his phone. It’s someone with an order, and judging by the fact that he’s calling the chairman of the company, must be a fairly large one.

Hasija holds his phone to his ear with one hand and with his other, opens up a tall notebook filled with orders. He negotiates with the caller on the best price and then notes it down duly in the notebook across 5 or 6 ruled columns.

The chairman of Rs.1200 crore company noting down orders in a notebook is my second surprise of the day.

The call over, Hasija whips out a cigarette and starts smoking. No explanation or excuse is offered. Being an enclosed cabin, smoke surrounds us.

He takes out a phone from the drawer in his desk and pushes it across the table to me and his PR rep. He’s got an impish smile on his face.

“What do you think of it?”

It’s a pretty standard looking touchscreen phone.

“Er, it’s nice,” I venture.

Without a word he takes it back, but under the table into his lap. He fiddles around with it for a few seconds and then slides it back out again towards us.

This time its a standard candybar phone with a numeric keypad.

“Is it the same phone?” I ask him.

In reply he takes it back and slides out keypad…and voila! It’s back to a touchscreen.

Nifty trick, but does it really move phones by the hundreds of thousands?

How did he manage the remarkable feat of beating Micromax to become the number four player in a competitive market like India, I ask him.

Hasija smiles, then tells me that his company actually has been number three in the market (after Nokia and Samsung) since April 2011. “I’m selling around 8.5 lakh phones per month right now which should increase to nearly 1 million by January,” he says.

The mobile market in India is crazy, competitive with new models and lower prices almost every week. How has he managed this?

Do Unto Others
Hasija lights another cigarette, takes a couple of puffs, and then says, “We’re more transparent with distributors”.

That’s it? What does that even mean?

“You see I used to be a Samsung distributor once, and before that a Nokia distributor. The way it worked was this: the company would pressurize its national distributors who in turn would pressurize their regional distributors who would finally pressurize dealers.”

As a result, says Hasija, dealers would often be left holding the baby for no fault of theirs.

“Take the example of a price drop. Usually the company would sell its stock at full price just before the drop, in order to meet its monthly targets. As a result the dealers are left holding expensive stocks while the MRPs have been dropped by the company.”

Because Hasija felt that pain, he claims to be more sensitive towards inflicting it on his own distributors. So he today offers a 15-day ‘price guarantee’ to his distributors to protect them from such incidents.

I’m not convinced, because its sounds too vague to power such hard growth numbers.

But Hasija has moved on to a new phone on his desk. This one has a user interface that looks exactly like Android, including the apps.

“So its an Android phone?” I ask him.

No, he says. “We call it the Tornado and it copies Android’s look, skins, apps totally.”

I’m flabbergasted. The UI felt zippier than the real Android UI on my year old Google Nexus One.

I want to ask Hasija if its even legal? But he’s already switched tracks in his mind to real Androids.

2012 is going to be about Android smartphones for us. We launched our first Android, the A1, at Rs.6500 two months back. Next month we’ll launch three more.”

He’s already on to his third cigarette.

“But we now have to get to a mindset that technology means experimentation, experimentation means failure, and failure means learning. Indian leaders and business mentors need to talk about failure openly.

Here in the US, they even have a word for failure — ‘pivoting’.”

That was super prolific professor, researcher, columnist, business advisor and serial entrepreneur Vivek Wadhwa in an interview to me in July last year.

The word that drew me back to this interview was “pivoting”.

Primarily a US startup phrase, it means the act of changing your original business model once you find that customer or revenue traction was hard to find.

Here’s a great post that explains the concept of a pivot.

For many years, the concept of a pivot didn’t exist among Indian startups. You either did extremely well, middled along towards eventual irrelevance or failed abruptly.

But as Valley-style venture investing and entrepreneurship has taken off in India, we’re beginning to see the rise of pivoting among Indian startups too.

So Ibibo which started off in 2007 as an India-focused social networking site later pivoted to becoming an online gaming site. It’s now also trying to become a travel site.

inMobi, the mobile ad network that pulled in a staggering $200 million in venture funding in September 2011 started out as mKhoj, a mobile search engine in early 2007. They pivoted.

SMSGupshup, an SMS-based social networking service that has seen runaway growth in India started out as Webaroo, an ambitious software to download websites for offline viewing in 2006. They too pivoted.

Then there’s July Systems. When Rajesh Reddy started it in 2001 it was meant to be a “wireless superstructure” to deliver all kinds of mobile content. Six years later he was forced to pivot his business model to becoming a white label mobile app maker for businesses.

Guruji.com launched in 2006 as an India-specific search engine. After being unable to make a mark with its original goal, Guruji pivoted to becoming a music-search engine two years later. After getting sued by T-Series for encouraging copyright infringement, Guruji shut down the music search service and pivoted, in April 2011, to becoming a platform for real time bidding on mobile ads.

Another India-specific startup, Minglebox, also started in 2006 with the goal to become a social network for the youth. In two years it had pivoted to being an education portal for teens and college goers.

While I don’t have conclusive evidence to say if Ibibo, Guruji and Minglebox have achieved success after their pivots, the others in the list seem to doing quite well.

The obvious learning from pivoting is this: a startup brings together tremendous talent, energy, ideas and products. Just because an initial idea failed doesn’t mean all of those should be disbanded.

The trick is to pivot in a direction that best utilizes the work that has already been done and the lessons that have already been learnt, while significantly increasing the size of the potential market.