We have discussed some of these ideas on venturewoods before, but I thought I would get more specific thoughts. We are seeing more and more businesses around the theme to offer a $100 a year service to a million users. Few ideas that have got discussed here include:
1. Online DVD rentals
2. Online photo printing
3. Online tutoring (export oriented – ok more like 100k x $1000 here)
What are the views around feasibility and scale on some of these? Will these land up being more like 100k x $ 30 plans in the online context? Given that 5-10 startups are starting out at the same time, will the market fragmentation be too high?
Any other ideas that might fall in this conceptual framework?
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Regarding online DVD libraries: Is there any market for off-beat movies ? I think libraries that have a collection which is not available in the local dvd store and the usual music stores may be a decent bet. For eg: Award winning french/german movies. Considering the number of people who flock to Alliance Francaise and Max Mueller Bhavan, it may be a wise choice or even Hollywood movies which never get released in India.
Interesting about the MMS thing: I believe many people do not have the ability to MMS their photos over. I think what might be a good idea is to have kiosks in malls which can accept cash or cards, and where you can connect your phone (all sorts of connectors, all sorts of phones). A touchscreen shows you the photos on your phone, you select what you want, and the photo comes out a little chute. Rs. 10 per photo. This can also be customised to a “send photo” option. Addresses can be read from a credit card or you can use different “ship to” addresses. And why stop at mobile phones: Allow cameras as well.
I like that idea, actually. An experiment in Forum mall in Bangalore may be a good idea; a one month manned kiosk (so no credit cards are needed initially) to gauge response. Can be done as a beta for Nokia mobiles exclusively. Hmm. Anyone game?
DVD Piracy wise: Quality is not so much an issue anymore. You can get pirated DVDs that have the same quality for something like Rs. 100, inclusive of a printed sheet and a DVD case. The issue here is the local dvd rental shop (of which at least one exists per area in India I would think) which buys such DVDs and rents them out. That simply kills the online DVD rental by undercutting.
But still, there is an interesting market for sitcoms and perishable content, which is too high strung and technical for the local shop. Essentially, get the producers to send you content over the wire, and you stream it to your local locations when they need it. All they do is burn a DVD when someone requests content – a process that can take 10 minutes for a rewritable DVD (apart from the download time, which you can shunt out through quality lines and torrent style non-public peering) Royalties and revenue shares are the way to go, and investment isn’t too high.
I accept most of the skepticism on online DVD rental due to piracy — however, I think there is still a market there, even if 10% of the consumers value the benefits of a branded service (quality of DVDs, better availability, good service). As an example, there is a lot of under-reporting in cable industry in India (which is equivalent of piracy), but even then, DTH seems to have had a good run in its limited availability so far… I think the key point here is that consumers are not necessarily getting a good deal because of piracy — in my observation, relatively few customers have easy access to Rs 30 DVDs…
Piracy could be a large factor as far as economics of these businesses are concerned, but branded businesses can still get user traction.
Agree with Himanshu, piracy will kill online DVD rental business unless the government decides to do something about it , I toyed with an online peer-to-peer DVD exchange model but when you can buy an DVD containing 2 movies for Rs 30 (here in Chennai) how do you compete against that.
Online photo printing: keeping in mind the low level of internet penetration in India coupled with the fact that mobile phones with built in digital cameras are notching up huge sales numbers, if we could have a service where I could click a photo on my mobile, MMS it to a service provider along with an address, service provider prints it and mails it to the address and charges it to my phone bill. This is a service I can use today.
Mobile Marketing…
Subscription Base: ~1950 millions [World – GSM]
Subscription Base: ~ 730 millions [Asia Pacific – GSM]
Growth rate: ~ 30% in last 4 quarters [Asia Pacific]
India: Total subscription base of 9.5 crores…[GSM+CDMA]
If an application is targetted around this, and generates a bare minimum revenue of Rs 1 per month per user/subscriber….it has the potential to generate 9.5 crores INR per month…
regards
Ajay Jain
ajayjain78@rediffmail.com
http://jainajay.blogspot.com