Couple of Questions for Eric Schmidt

During Gartner Symposium/ITxpo Orlando 2009, Google's CEO Eric Schmidt spoke to gartner's
Analysts and some of the TOP points that came out and my questions to Eric on the same:

1. Five years from now the internet will be dominated by Chinese-language content.
Question 1 - With the amount of sensorship in China - why do you think "Chinese content will Dominate?" Just the Volume of content or Value of content?

2. Five years is a factor of ten in Moore's Law, meaning that computers will be capable of far more by that time than they are today.

Good for us!

3. Within five years there will be broadband well above 100MB in performance - and distribution distinctions between TV, radio and the web will go away.

I hope this happens... very optimistic approach from Eric I must say...

4. "We're starting to make significant money off of Youtube", content will move towards more video.

5. "Real time information is just as valuable as all the other information, we want it included in our search results."

6. "We can index real-time info now - but how do we rank it?"

7. It's because of this fundamental shift towards user-generated information that people will listen more to other people than to traditional sources. Learning how to rank that "is the great challenge of the age." Schmidt believes Google can solve that problem.

Question 2: "Why do you want to rank that information at all?" If I am following someone and I am going to take a decision based on that individual's recommendation, then I have built my ranking algorithm in my mind...so why do I need google to tell me the rank for the same?

http://www.youtube.com/watch?v=lHxub_yQfig

BOKU.com – Not so Rosy for MOBILE Payments

The rosy picture painted in my previous post about BOKU.com doesn’t seem to be that rosy. Based on reading fine print on BOKU.com’s website and some number crunching and deeper analysis, it might become more expensive to acquire new customers and retain customers if you use BOKU.com unless you get a phenomenal increase in conversions.

Airtel + BOKU can reach a huge user base of mobile customers in India. However, it seems like talktime currency can not be used to make payments. So the overall user reach (especially in smaller regions) reduces tremendously.

Postpaid customers – If postpaid users are going to be charged in their bills then service charge, recovery and fraud management will become an issue.

Broadly there are some more important issues to think of:

1) Customer’s Perspective: In the bill amount the user has to pay ~10% service charge. Which means that if they spent Rs. 100 they actually have spent Rs. 110 which they will realize in their 1st bill.

Merchant’s Perspective

1) Airtel + BOKU is charging some ridiculous amount of 25% – 45% fee to allow such transactions. If we go by industry standards, online payment gateways accepting credit card/debit card/Paymate(mobile), ITZ Cash cards etc… all these guys charge not more than 10%. Which means in the case of BOKU, the merchants will have to compensate nearly 25% to 45% of the cost of payment made by users. Which is ridiculous.

2) Merchant’s Perspective: If BOKU says that these numbers add up and it’s volume game and more conversions will help in driving revenues and break-evens then it means that by adding BOKU your conversions need to go up by atleast 10%(this number varies for various industries) till you break even.

3) After careful consideration and number crunching it looks like your existing customers who are already using credit or debit cards to make online payments should actually NOT move to this Mobile payment option as in the earlier case the merchant is compensating for 10% of the fee, however, with BOKU the compensation increases steeply.

BOKU Vs Merchant VS Telecom Provider
1) Credit period and liquidity – Telecom providers are asking for a credit period of 90 days before they release payments. Which means the merchant’s liquidity will get hit. They are willing to reduce it over a period of time to 30 days or 60 days. However, this is ridiculously high as compared to almost 24 hours time frame provided by Online payment gateways.

2) Money recovery from customers – Recovering money from post paid users for wrong charges on their bills might become an issue as they will have to handle fraud complaints and resolutions.

What BOKU can be helpful in is… converting new users. Making payments for the 1st time when the user is not sure about using their credit cards.

Unless Telecom carrier’s and BOKU’s combined cost doesn’t come down to something similar to other online payment gateways, this looks like a flashy new system to me which will take it’s own sweet n slow route to become what they want to become.

Digital Marketing in India - Agencies or In - House?

I would be publishing the blog post on "Digital Marketing in India" - Agencies or In-House where I am going to profile some Top Digital or Interactive marketing Agencies in India.

To get your organization profiled, send me a mail.

With this I will also be publishing the results of the in-house survey on "Internet marketing challenges and opportunities – 2008". To be part of this Global Survey...Click Here.