Archive for August, 2009

M-Commerce India – The Future & Challenges faced!!

For last couple of days have been doing lot of research on M-Commerce Models in India and lot of people have come to my rescue in making me understand perils imposed by government regulations restricting growth of e-commerce in india through mobile medium.

Best to my understanding all the existing M-Commerce model been adopted by players like M-Check, Obopay, Paymate etc require user to map a banking instrument like credit card, debit card, bank account etc to their mobile phone account and via an application installed on phone or through the provider concentrate on making payment instrument mobile enabled.

Although its a big leap from security point of you enabling people to start paying via the mobile phone WAP,SMS medium for various merchant services available though still such services have not reached a critical stage due to lot of factors like non-tie up with all the banks or people still not comfortable sharing credit/debit card account information etc.

Trying to understand with such stringent norms coming through TRAI guidelines making its mandatory to identify customers which are as stringent as required to open an saving account and get a debit card, it made me wonder telecom companies with their access and reach are in the best for forward integration into becoming a bank then other way around. If today i using my mobile phone account could start paying at merchants like credit cards or using pre-paid cards start buying stuff like vegetables etc, my bank usage for daily transaction would reduce significantly.

I am sure it may make you think why are people at telecom companies doing same though biggest barrier understood from various experts is the TRAI license fees calculation system which is approx 6% of annual gross revenue. So until unless you register as VAS provider with operator and clearly revenue parted is shown in books it will be still counted as net reciept revenue making the commerce business unviable as merchants wont be ready to pay for transactions around 7-8% where banks are charging between 2-4%.

Compliance to RBI banking norms is much simpler task for such telecom companies for handling banking, fraud transactions but the biggest barrier imposed by TRAI in terms of license fees need to be cleared.

The way around for now is to build MVAS application which can be charged to user account on service or tangible asset delivered for consumption on mobile device then its workable.  The TRAI Guideline paper(linked) actually doesn’t restrict telecom companies to use their platform to accept payments as when you clearly read 2.1.3(iv) it clearly states in case of M-commerce one needs to adhere to RBI guidelines where ever necessary and if you goto RBI guidelines(linked) it states clearly that these guidelines are for “BANKS” for dealing with customers via mobile as a medium, this still doesnt govern the telecom companies.

I  am talking to lot of telecom’s to get their views on same and will do a follow up post if see some success.

Health Startup Opportunity in Indian Market

For last couple of days had been trying to demystify the health space in India and found out most of the startups rising are targeting the B2C space where doctors are the businesses and connecting them with consumers. Though the space tend to be bigger but if you try to work out revenue per user and scale required to breakeven without the right money muscle power it makes it difficult to pull of the same.

Although a niche space not being explored and which can be scaled easily to other markets and have higher adoption by the doctors is to create a Doctors startup kit for independent practitioners which is primarily a vehicle for pharma and other medical device companies to reach out to smaller practitioners. The kit can take either of 2 directions

i)  Medical Journal Route where one discuss new happening,drug discovery and tries to push such information on regular basis, host webinars and conferences for doctors and takes care of sending free medical samples, garner feedback for medical companies etc. Help bring down cost of marketing for Pharma companies. The model is different from which again concentrates on just the research information part but not concentrate on the business model for organizing free medical supplies and feedback loop from practitioners to Rx companies.

ii) Online Clinic Management Tools for doctors which help doctor use power of internet,mobile to manage patients their history etc free of cost again sponsored by Rx companies where access to patient data to pharma companies and doctors schedule help them push relevant diagnosis and suggestions of their products. is another startup based out of US which has taken similar B2B route in the overcrowded B2C market and has great potential for growth if it clearly keep launching services which will enable doctor to keep moving more of his offline MIS online for more convienence.

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August 2009