Appnomy: Users spend more time on mobile apps than on the desktop

[Article reproduced from Appnomy, a community portal for app developers to gain visibility and connect to other app developers.]

Mobile apps are the buzzwords these days as more and more developers are looking at mobile app development as a big business opportunity. Well there are mixed schools of thought on this one – although app development can be a highly profitable, other studies suggest that about one third of all mobile app developers earn less than $1000 per app.

Whatever the case may be,  mobile users are taking to apps at a more rapid rate than ever before. It’s not just the number of apps that are being downloaded but also the time that users spend on mobile apps is rising heavily. A recent report by Flurry based on usage trends of users in the US throws some interesting stats at us. ( Even though the survey was conducted in the US, India can not be far behind, speaking in terms of when a similar situation will be witnessed in India and looking at the increasing expenditure on smartphones in India).

Usage statistics:

For the first time ever, daily time spent in mobile apps surpasses desktop and mobile web consumption.  This stat is even more remarkable if you consider that it took less than three years for native mobile apps to achieve this level of usage, driven primarily by the popularity of iOS and Android platforms.

A closer look:

• The average user now spends 9% more time using mobile apps than the Internet.
• Growing at 91% over the last year, users now spend over 81 minutes on mobile applications per day.
• Time spent on the Internet has grown at a much slower rate, 16% over the last year.

Internet usage is rising in India and so is its mobile penetration. Recent studies show that India’s internet connectivity is rising but the average broadband speed is on the decline. So we can look at these stats as an indication of the future in the Indian internet and Mobile industry.

Games and Social networking drive usage:

Games are the most lucrative apps to develop for mobile platforms due to their monetization ability, and users too are increasing spending more time gaming on their phones than doing any other activity ( involving apps ). Social networking is the next biggest category for app usage on mobile phones.

How do you think will India story fare in the next few months?

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Village Laundry Service, Chamak Raises Series A Round

Village Laundry Service (VLS), an Innosight Ventures portfolio company has announced that it has raised Series A financing from Kensington Capital, Index Advisory, and a private India-based investor. The investments will allow VLS to continue the rapid expansion of its chain of laundry kiosks, operated under the brand name Chamak.

We profile Chamak when it was starting up (2009) and this is what we wrote:

They seem to have about 10 locations in Bangalore itself. Someone obviously heard the chatter about the pain points with the existing vendors etc and decided to give this a shot. I’m not yet debating about it being a great idea etc, but its an opportunity, and its heartening to see someone take a crack at it.

One’s heard often that 10 other people have exactly the same idea at the same time as you have it (or even earlier), and it boils down to execution, but it was still a very wow moment to come across a real world example of one such.There are opportunities galore. We often do not explore enough, or fail to understand the real pain points of the consumers we’re trying to address.  It takes ears on the ground, and a continuous interpretation of what it all means, to identify what might serve, delight the consumer and differentiate the service.

Chamak was started by Akshay Mehra (MBA from IIMC) who has more than 10 years experience in FMCG and retail industries, and moved back to India after being in Singapore for 7 years.

Chamak booths are innovatively design of be rollaway booth units (small 4ft by 4ft footprint, with self-contained water supply) allowing positioning in high demand locations, flexibility to move and most importantly reducing the rental costs per booth. The company has developed unique water handling system which allows them to use the rig without having any water connection close by, allowing flexibility in locating where the customer is and not where the utilities are available.

Importantly, technology has played a big role in keeping the pricing low (Rs. 50/kg), and the startup has found a sweet spot – i.e. the gap between a cheap dhobi and expensive laundry service.

An interesting startup that is solving real pain point using technology and most importantly, executing it well.

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ICANN Approves more Top Level Domains : Huge Opportunity for Trademark Promotion

The Internet Corporation for Assigned Names and Numbers, or ICANN, in a decisive vote yesterday said in a press conference in Singapore that it will now be accepting a wide range of new TLD ( Top Levels Domains ). TLD are the extensions that we see after the name of any site, currently there are 22 such gTLD names available, for example .com .org and around 250 country level domain names like .in, .us, .cn etc.

The new program called Generic Top Level Domains (gTLD) will allow companies to take more control over their brand on the Internet and essentially dilute the effect that domain name squatters have on brand value. For example you may be a restaurant owner looking to capitalize on your brand name and limit yourself to a city, you can get yourrestaurant.city, that is if you can pay the price for owning the Domain name. But it doesn’t end there, these domain names will be available in new language too and these include Russian, Chinese, Japanese and Devnagri!

This move by ICANN will change the way we see internet domain names today. The introduction of such new names will be a mixed bag. While large companies will benefit from this by taking more control of their trademark and intellectual property rights, they will also have a hard time keeping track of new kinds of cyber squatters. For example somebody may register a volvo.india, an obvious infringement of intellectual property.

While this is a positive move, getting approval for the Domain names will not be easy. To get the rights to a registry, the internet domain names governing body has set the application fee at  $185,000, it costs $25,000 a year to operate the registry, and other fees are possible, too. Not only that, a business will have to prove legitimacy before it is granted the rights to that Domain name. If a registrar cooperates with a “bad-actor”, the consequences would be dire and may extend upto ICANN cancelling the contract with the registrar. This means if somebody own the extension .india and grants the domain name google.india to  anyone without a legitimate claim to google then they registrar that operates .india may be fined as ICANN feel is appropriate.

ICANN will accept applications for registries from the 12th of Jan 2012 and we may see the first gTLDs approved by the end of 2012. We think this move will provide small businesses a chance to showcase their trademark on the internet and give them that little bit extra that they need to be noticed. What is your take?

Is it a good move or will domain name squatters have another field day? Let us know.

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Investing in Student Entrepreneurs, Stephen Bell of Trilogy VC

It feels like there are so many investors in China. Everyone is looking for the next Baidu, Tencent or Alibaba. The high supply of investors has created a high demand for start-ups. With so many investors playing in the same market, the trend is shifting towards earlier stage ventures. Steve Bell of Trilogy Ventures is taking ‘early stage’ to a more literal level by seeking out hot entrepreneurs in top Chinese universities.

A history of entrepreneurship

Steve studied a B.Chem at Georgia Tech and spent his early career at GE Plastics. In 1994 he was CEO and Founder of CORE Products GmbH, a tier 1 Auto Supplier – based in Switzerland and today a large global company. In 1998 he was CEO and Founder of SupplySolution Inc. which had multiple VC financings and later sold to Tradebeam. In 2006 he was CEO and Founder of ShangBy Inc. a Draper Richards VC financed company that later died in 2008. Since 2009 he has been the co-founder and Managing General Partner of Trilogy VC.

To find out more about Steve and his investment philosophy, I interviewed him.

China – full of talent and a high speed economy

“Between 2002-2006, I was Sr. VP at Trilogy Inc (needed “break” after 2 startups), I ran Product creation functions including leading Trilogy University – where each year, Trilogy hired from the best schools in the world and put the new hires outside the company in Trilogy University, where over 90 days the new hires formed small <5 person teams and created every new product at Trilogy Inc.  In 2005/06 – we did Trilogy Uni in Hangzhou China where we grew a 250 person office.

After only a few visits to Trilogy China, I was really blown away by 1 - The TALENTED people, really wanting to make a big difference and 2 – The speed of overall economic development.   It seemed to me China was the BEST place in the world to be an entrepreneur. Low cost at <5X USA for very early tech start-ups and fastest growing consumer market in the world – soon to be the biggest!

In 2006, while walking in the dirt market Beijing had a crazy idea that if we had video camera connected to web – my friends in USA could be “shopping with us live”.  Two weeks later, I started ShangBy Inc. and moved to China.  ShangBy hooked up video cameras in many Shanghai Jewellery stores and let mostly American women, shop live in the stores – just like being there with a real time one way broadcast video linkup.  They could buy and get goods in 3 days.”

Apple, Google, Microsoft, Facebook – all started by Students

“I had a front row seat to incredible creativity and innovation of top students while running Trilogy University.

When I ask students in China to name GREAT companies that become huge companies  (I have asked 1000′s through our University event programs) 4 companies are always in the first 5 names by students – they are Apple, Google, Microsoft, Facebook – all started by students.  I think student entrepreneurs have two big advantages. First, they are the most creative and most likely to do a really new idea and create a whole new “industry”. Second, they cost the least as they have very little obligations and responsibilities compared to the 30 year old or 40 year old.

I think experienced entrepreneurs have a much higher “success rate” and the students will fail more.  But students will start the BIGGEST companies and the really huge new products.

Finally, every VC/Angel I meet thinks experience matters and likes to invest in experienced entrepreneurs.  I have no competition and the students really need the help and money.”

Looking for doer’s who are determined, curious and have passion

1. “First – DOERS. People who build product and not just plans. I like engineers or product people / designers!  I have not invested in any MBA teams yet and probably will not.
2. Second – DETERMINED. People who will persevere through all the adversity and set-backs in the life of the start-up. I like entrepreneurs so committed to their product / vision – they will never give up and will do it whether I invest or not. They will always find a way.
3. Third – CURIOUS. I think the best entrepreneurs I have backed so far are all curious people who have broad based interests and can ultimately be effective CEO’s as their start-up gets big.
4. FOURTH – PASSION – I want to be “inspired” by the entrepreneur’s vision and product.”

Adding more value than money

“Trilogy VC wants to invest where we can add value beyond our money.  We focus on Mobile, Consumer Internet, Games, and New Media – areas where we have a network and expertise.”

Uni campus visits, competitions and a 3,000rmb prize

“Trilogy VC runs regular events at Tsinghua, Beijing, Beihang, Shanghai Jiao Tong and Zhejiang Universities.  We reach a 1000 + students on each campus each school year – and try to convince more of them to do start-ups.

A typical event will be me talking about how to start-up and I invite a young Chinese entrepreneur who already has a big business as a guest speaker to share their story.  Then we have 20 students give a 60 second elevator pitch to the audience. The audience votes and I give a cash prize of 3000 RMB. We have done this event more than 50 times.  We do this to build the Trilogy VC brand in top campuses.  I want every student thinking about a start-up at top Chinese Universities to think of Trilogy VC and seek me out.  I am very accessible to students at http://stevebell.renren.com and http://weibo.com/stevebell.”

Big Crowd at Beida DaXing

Letting the entrepreneurs take control

“We want to always provide at least 18 months cash to fund operations and like capital efficient small teams.  Typical investments are under 1 Million RMB.

We are active investors generally with a minority board seat. We love to talk product and distribution with the teams but the entrepreneurs run their business.  We generally get very involved in helping get ready for next funding round and making those VC introductions once the product is successful in the market.”

Most successful investments

• JIATHIS – social sharing
• Droidhen -  Android Games

 

Related posts:

1. Trilogy VC – investing in Chinese students
2. Helping the next generation of Entrepreneurs in China, Peng Ong of GSR Ventures
3. China’s Top Angels Share With Stanford Students: How to Cooperate with China’s Investors

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Ctrip: Incubator for Chinese Hotel Initiatives

Ctrip, the Chinese travel booking site, went public on Dec 9, 2003. Eight year later, to many people’s surprise, the largest travel service of its kind in China now enjoys a market capitalization of over 5.907 billion US dollars, only second to Baidu, ranking even before long-standing portals like Sina, NetEase and Sohu and online game powerhouse such as Shanda.

 

Founded in 1999 by Ji Qi, Shen Nanpeng, Fan Ming and Liang Jianzhang, Ctrip offers flight tickets booking, hotels booking and vacation tour service to its customers. According to its 2010 annual report, Ctrip’s 2010 net income grew 45% year over year to US$ 437 million. For the first financial season in 2011, its net income grew 30% year over year to US$ 117 million.

 

Although many don’t consider Ctrip as a hardcore internet business for a large part of its operation runs offline, the booking service boasts a market capitalization that every internet company would dream of. And according to Chinese market research firm iResearch, Ctrip holds over 50% of travel booking market in China, while Qunar, eLong and many others take over the leftovers.

 

In all respects, Ctrip is a successful business that generates consistent and sizable revenue with decent shareholder return. For its four founders, after nearly 5 years’ immense and painstaking labor, successful IPO brought them both big fortune and widespread fame.

New Ventures

After Ctrip, the four young and restless founders went on with new ventures. Interestingly but not surprisingly, their new businesses all related to travel and hotel business more or less. Ji Qi founded Home Inn in 2002, which has now grown into China’s largest budget hotel operator and eventually listed in Nasdaq on Oct 26, 2006. Later on Ji founded another hotel chain HanTing Inns and Hotels, targeting businessman with slightly higher price than Home Inn in order to differentiate markets. HanTing also listed in Nasdaq on March 26 last year.

 

For Shen Nanpeng, he joined Sequoia Capital China as partner. Liang Jianzhang resigned from Ctrip as CEO to study in the U.S. While Fan Ming serves as CEO till now. He also founded Starway Hotel, the hotel subsidiary of Ctrip.

 

And some ex-Ctrip executives also had a thing about hospitality industry. Wu Hai who used to serve as VP of Ctrip started his own Orange Hotel in 2006, while Zhen Nanyan, the VP of Ctrip founded 7DaysInn, another Chinese budget hotel chain in 2005, which listed in NYSE on Nov 20, 2009.

Related posts:

1. Rumor, Jack Ma Wants to Buy Ctrip
2. Tencent Bought 30% Share of 17u.com, Enters Online Travel Service Market
3. The Chinese Internet Industry: Mapping International Initiatives

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Renren First Financial Report Since IPO – Loss Narrow

Renren‘s share price has been tumbling since its mega size IPO.   Investors worried if they have been paying too much for the so-called Chinese Facebook.  It went as low as US$6.55 last Friday, more than 50% off its IPO price of US14 a share.

But every cloud has a silver lining.  Renren released its first financial report after its IPO.  It significantly narrowed its loss: 78.5% decrease from a year earlier.  And it looks like the so-called Chinese Facebook might be break-even soon.  The news boost its share price.  It closed at US%7.6 on Monday, up 8%.

One thing Renren worried investors the most is Renren’s financial.  After all, last year it made a loss of US$64.2 million and its revenue was a mere US$76.5 million.  That means it lost 84 cents for every dollar it made. The company’s net loss for Q1 of 2011 was US$2.6 million, compared with US$12.1 million in the same period last year.  And its revenue increased 46.6% to US$20.6 million, of which, advertising more than double to US$8.1 million.  And  IVAS revenues (mostly game) was up 24.7% to US$12.4 million.

If the trend continues, it expects revenue to increase to US$29 to US$30 million next quarter, representing 46% to 51% year-on-year growth. If Renren can turn profitable soon, the company might not be overpriced any more.   Actually, it might start to look like a good investment.  Deutsche Bank analyst, Alan Hellawell, gives Renren a 12-month target price of US$8.42 a share.

Other points worth noticing:

- Renren has targeted 35% user base growth per year

- The number of activated users increased from approximately 91 million as of March 31, 2010 to approximately 117 million as of March 31, 2011, and further to approximately 122 million as of May 31, 2011.

- The monthly unique log-in users increased from approximately 23 million in March 2010 to approximately 31 million in March 2011, and to approximately 33 million in May 2011.

- Within the IVAS revenues, its social commerce services (Nuomi.com), which was launched in June 2010, had US$0.9 million of net revenues for the first quarter of 2011.

- Alan Hellawell, estimates that 30% of Renren’s traffic is mobile, and that the number of mobile users tripled since Jan 2011.

- Alan also views Renren as a clear beneficiary of the 3G & smartphone age in China, and expect location-based and mobile commerce user behavior to broaden over time.

- He also estimates that college students represent 35-40% of Renren users. Their daily activity is significant: roughly 50% of these students log in on a daily basis.

Related posts:

1. Three More Reasons Why Renren Is Not Facebook of China
2. Kaixin IPO in 2 months
3. 360 Announces its Strategic Partnership with Renren

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Call For UnPluggd Partnership/Sponsorship [The Event]

Last call for those of you who want to reach out to the smartest and serious breed called Indian Entrepreneurs.

We have couple of sponsorship slots available and we are freezing the entire story by next week – so if you are a business in the business of startups/SME, do get in touch asap.

No shit – this is THE event you want to be seen at!

Most importantly, we have slabs for companies who want to showcase their product/service at the venue stall. That is, companies who want to build a brand/reach out to entrepreneurial/geeky customers for their services can put up a stall at the venue (do take a look at the demo room pic) .

Connect with us for more details regarding stall sponsorship (email: kunal@unpluggd.org ashish@unpluggd.org).

Startup Demo Slot

As far as demo slot nomination is concerned, the deadline is June 26th (apply now). We have very interesting  startups launching @UnPluggd – and if you are a startup that applied for the demo slot, you will hear from us by June 30th (or before that).

If you have built a great product, do apply (read testimonial from last event finalists/startups who demoed at the event).

Update on Speaker List

This time we are doing something very different – we are also bringing in speakers from different geographies (entrepreneurs, ofcourse) who will share how they went ahead and built a global business.

Call to Action

• Reserve your seat asap (hop to our ticketing partner site).
• Help us spread the word. This is an event for entrepreneurs and we want everybody to benefit from it. Tell your friends about the event (Facebook Event Page).

Sincerely,

The UnPluGGd Team.

Date: July 9th, 2011.
Venue: MSTS Institute of Management and Entrepreneurship. J.P. Nagar, 6th Phase, Bangalore – 560078.

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India's Largest Startup Event, UnPluggd Is Back (Mindblowing Content + Exiciting Startup Demos » July 9th, Bangalore)

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Apple’s Business Model In trouble In India? [Under Competition Commission of India Scanner]

Since its launch, Apple’s iPhone has always been available tied to a network operator, or locked to a network operator. Sure as technology enthusiasts would know how to workaround this problem, the average consumer is still relatively unsure about these methods. There is no doubt that India is a huge untapped market for Apple as its revolutionary products are available late and often at high prices.

Apple has been pulled up by the CCI ( Competition Commission of India) for allegedly using its strong position in the market to limit the choices that consumers have.

“A customer has filed a complaint before the Commission under Section 4 of the Competition Act 2002 that Apple is curbing the customer’s choice by limiting the availability of iPhones and iPads in India to a limited number of service providers, besides its signature stores”. The complainant has also alleged that a user can only download software from the i-store and the others are not recognised by the device [source].

A whole lot of confusion, right? Let’s take a look at the model that Apple uses to distribute its iPhone and what the complain actually mean.

Apple’s iPhone was a stellar piece of hardware even in its first generation and its user experience meant that the user would definitely turn into a major consumer for network operators that provide internet services. This meant that it was inevitable that the device OEM and network operator strike a deal where the phone would be available through the network operator at a subsidised price.

This makes perfect sense for both companies to collaborate to help each other and in the process help themselves. This same model has been used by many different OEMs with different network operators, both driving consumers to their services by promising exciting offerings.

Apple’s App Store approach to app distribution meant that they could keep a check on the availability of apps according to region and such. Both parties even made their services available without partnerships, meaning you could go buy yourself an unlocked iPhone that would be compatible with any network operator out of the box and you don’t have to have an iPhone if you want to use a particular network operator.
The iPhone now in its fifth generation is out in India and is being offered by network operators Airtel and Aircel, but it has run into a problem with the Competition Commission of India.

apple india launch

The complainant alleges that the users can download software only from its official Apple App Store and other app stores are not recognized Well we already know this as a feature from Apple’s walled garden approach to product development (isn’t this true for other app stores as well?).

It assures the user a good experience but at the same time reduces choices that other app stores may be offering. Jailbroken or unlocked devices can install alternate app stores to download apps but that’s a different story. Another allegation that the complainant makes is that Apple hardware can only be serviced at Apple stores and that they are expensive, this may be true but can you really tell a company what they should charge for their products?

What we here would like to focus on is how companies make their business model based on simple logic and profit motives and the governing regulatory authority tries to level the playing field for all players. If we take a business point of view to the situation, Apple’s business model works as we can see worldwide the success of the iPhone and iPad devices is unmatched.
If you look at the consumer’s point of view, you can say that Apple is forcing consumers to move network services to others by using its dominant position in the market.

But then again its the way of the world of business, both parties have brought something to the table in this deal and both deserve to benefit from it. Is there any weight to the complaint filed by the consumer or just a complaint that should be trashed? What’s your take?

[Image credit:Brajeshwar/Flickr]

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