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September - 2007 - issue > Cover Feature
Mobile consumer electronics revolution heralds progress for the masses
Sanjay Mehrotra
Sunday, September 9, 2007
Thinking of the India of my dreams, I can’t help but go back to a poignant incident that happened in my early teens. I wanted to buy a camera and had hoped to find a store that would be able to help me choose a camera to suit my needs. Unfortunately, the few stores carrying cameras had an extremely limited number of cameras and salespeople who knew well about the products. The India of the future, as I see it, will be a place where no person will experience such a situation.

This can be made possible by a revolution in organized retail. Only an organized retail chain has the funds and logistics necessary to keep and replenish an inventory of multiple products and brands and to train the sales staff to assist customers. Such services are commonplace in the U.S. and, to a fairly limited extent, in metropolitan areas in India. However, in India’s tier-II and tier-III cities, this retail model is rare. Efforts to spread the reach of organized retail to smaller towns are underway but such endeavors are still in their infancy. I envision that this arena will rapidly develop over the next few years.

The current growth spurt in the organized retail space across India increases competition among various brands and their suppliers, enhances access and availability of electronics products to the masses, and makes buyers more aware of the multitude of choices available to them. This facilitates informed consumer purchases, resulting in a satisfactory buying experience. Additionally, the inherent efficiencies of organized retail lead to greater product availability to consumers in a cost-effective manner. For a large and diverse consumer base like India, these benefits are critical to accelerate the growth and large-scale adoption of consumer electronics products across the economic strata.

In spite of limited buying power, there is a growing Indian consumer base with a greater amount of purchase power with enhanced income rates which is hungry for the kind of experience that the latest mobile electronics products provide. Whether it’s digital cameras, mobile phones, MP3 players, USB drives, notebook computers, or other portable electronic devices, the country has seen a huge rise in demand while a very large part of the potential market still remains untapped. These electronic products lend themselves to attaining a lifestyle of easy, affordable communication. They also allow for consumers to capture, access, experience, or share pictures, music, videos, and other personal or business information “on the go.” The upwardly mobile Indian lifestyle drives the demand for these products.

I must add that the desire to lead a mobile lifestyle and the necessity to stay connected at all times has fostered the mobile phone market in the country. No other device has held the interest of the country the way the mobile phone has. In fact, more than 7 million handsets have been sold in a single month. The research firm iSuppli Corp. expects the Indian cell phone market to triple over the next three years. Advances in technology are enabling the growth of increasingly affordable mobile phones with multimedia features such as built-in camera, MP3 player, video, internet and email access, and data download capability. Interestingly, flash memory storage is at the heart of enabling the digital lifestyle and mobile experience provided by such features on mobile phones. The flash memory cards from SanDisk, for example, are used to store the pictures or videos captured and shared on the phone, or they are used to store, download, and play the MP3 songs on the mobile phone.

Within the thriving market of the mobile phone lies the possibility to bridge the digital divide. The revolution in organized retail plays a big role in making mobile handsets increasingly accessible in non-urban areas at affordable rates. Furthermore, a rise in the per-capita income, decline in tariffs, and pro-industry and pro-consumer regulations enacted by the government will lead to greater usage of mobile phones by the masses. As the number of people that own a mobile phone increases, the economic divide that separates different social classes will reduce overtime. Mobile phones can enable all individuals to have equal footing in both their personal and business communications.

Moreover, over the next few years, mobile phones will have new applications supported that will potentially enable people from all different economic backgrounds and environments to carry out their personal day-to-day tasks, whatever they may be, with a new ease and with an opportunity to learn and develop. Mobile phones and related infrastructure in the future will help to grow the economy through various means. For example, they can be used to help individuals overcome their language or literacy barriers and even provide farmers with access to real-time market prices for their crops. Such opportunities can ultimately contribute tremendously to narrowing the economic divide.

However, this entire picture of the future I envision for India is missing one block – the infrastructure. Infrastructure that can enable easy, affordable, and reliable internet access on the mobile phone is just not available widely in India. In addition, the physical (roads, power, water, and communications) and social (schools, hospitals, etc.) infrastructure growth severely lag behind and remain a major hindrance to future growth. If the powers that run the country can eliminate the crippling bureaucracy, this can accelerate the efficient build up of the required physical and social infrastructure so that the Indian masses will be poised to leap to the next level. With huge opportunities ahead, the next ten years will be tremendously exciting
for India.

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