Is Reliance Buying Tiktok-India?

We are aware of the latest crunch of news that says, India’s most valuable company Reliance Industries Limited (RIL) is reportedly the latest bidder for the Bytedance-owned TikTok in India

Is Reliance buying TikTok in India?

The Mukesh Ambani-led firm had begun talks last month with the Chinese firm to acquire its operations in India. India is the largest market for the short video app outside China with more than 611 million downloads generated to date, according to data sourced from market intelligence firm Sensor Tower. However, when it comes to monetization, China, the US, and the UK accounted for 90% of the total TikTok revenues. Although Reliance and Bytedance both denied any information on the reported deal, industry analysts predict that Reliance’s acquisition of TikTok is the most likely scenario especially after the Chinese app was banned by the Indian government in June on the grounds of threats to national security and data privacy.
Interestingly, Facebook, which is the largest minority stakeholder in Reliance’s Jio platforms, has also recently launched Instagram Reels in India, where the users can make a short video, embedded in the photo-sharing platform.

While TechCrunch said that TikTok’s India operations were valued at more than $3 billion, the Economic Times said it could be worth anywhere between $2.5 billion to $5 billion.
Reliance, ByteDance, and TikTok did not promptly respond to appeal for comment. In response to the Economic Times though, the Mukesh Ambani-owned company, said the news was just speculation.

Banning of Chinese Apps

The Narendra Modi government, since June 29, has banned 59 Chinese apps, including TikTok and WeChat, for threatening its “sovereignty and integrity” after border tensions with China. Last week, US President Donald Trump unveiled bans on US transactions with the China-based owners of messaging app WeChat and TikTok, which escalated tensions between the two countries.
Microsoft Corp has been in talks to acquire the US operations of the video-sharing app, in an exercise that has been supported by the Trump administration. Social media platform Twitter Inchas also conveyed some interest to conduct a deal with TikTok, sources familiar with the matter reported Reuters late last week.
Sanchit VirGogia, CEO, Greyhound Research wrote in his note that in the present circumstances, Bytedance’s deal with Reliance Jio could be a viable option to clear the regulatory hurdles in India while also helping leverage the nearly 400 million users base of Jio.

“Despite the fact, that Instagram Reels is described as a clone of TikTok, the fact comes out, that the similarity of the features may act as an edge and help the Facebook backed photo-sharing app engaging millions of users in India who were earlier using TikTok. Facebook still has a larger user base than TikTok in India and with time, Instagram Reels can leverage the massive network Facebook has in India. Reels was first smartly tested in low-risk markets and then rolled out in India for scale and mass content – while it may not come across as integrated with other products, it may be too early to judge. Leverage with a broader FB network makes Instagram Reels more compelling than TikTok,” Gogia added.

Tech giant Microsoft had earlier said that it is planning to purchase TikTok in the US and other key markets. US President Donald Trump’s latest executive order last week serving a 45-day deadline for the TikTok sale may likely lead to fast-tracking the potential sale. Microsoft had confirmed that it is in talks with Bytedance to acquire TikTok and that the discussions will be concluded by September 15.
Chinese giant ByteDance is now engaging in some early discussions with Reliance Industries Limited for backing TikTok’s business in India for potentially saving the popular video app’s fate in its biggest market by users, TechCrunch was told by two people familiar with the matter. ByteDance did not respond to a plea for comment. A Reliance spokesperson declined to comment.

An investment in TikTok could act as a turning factor, helping the oil-to-retails giant Reliance, the most valuable firm in India to make deeper connections with consumers.
Some preliminary talks between the two companies come thatByteDanceis also struggling to retain some key employees in India. A handful of high-level executives at the company, inclusive of a policy head and Rohan Mishra, by whomHelo app’s(owned by ByteDance)operations in India, was overseen, left the company last week, according to some people familiar with the matter. Mishra did not give a response to a request for comment Wednesday noon.
Employees have been assured by ByteDance that it is in conversation with the Indian government to resolve New Delhi’s concerns and does not have any plan to layoff employees in the country. Any deal with Reliance — which is owned by Mukesh Ambani, India’s richest man and an ally of Prime Minister of India Narendra Modi — could be a great move helpingByteDance allay concerns of the Indian government, analysts said.
A new report indicates that TikTok chief executive officer (CEO) Kevin Mayer has approached senior RIL executives to analyze if RIL is interested in a stake in the app’s India division.
The Chinese giant is getting engaged separately with Microsoft to sell some of TikTok’s foreign operations including that of the U.S., confirmed by the Windows-maker earlier this month. News got reported by the Financial Times last week that the two companies had broadened the scope of the deal for includingTikTok’s business in other international markets, counting those in Europe and India.
A few local startups, including Twitter-backed ShareChat and Times Internet’s Gaana and MX Player, have launched a few freestanding apps or unified features replicating the social experience provided to the users by TokTok in recent weeks. Also, the local apps have raised some claims of having put on tens of millions of new users throughout the period.

TIK-TOK AND JIO

Jio Platforms is the Indian giant running operations as the nation’s largest telecom operator. But even though Jio Platforms has assembled nearly 400 million subscribers in India in a very short interval of fewer than four years of its existence, its consumer-facing apps have struggled a lot to replicate that appeal.
Since late April this year, the Indian giant’s digital venture has raised about $20 billion from 13 high-profile investors, which includes massive tech giants like Facebook and Google. A statement by Google announced that it would work with Jio Platforms for launching a customized version of its Android mobile operating system for powering low-cost Android smartphones. Facebook declared that it would also collaborate with Reliance helping digitize the country’s 60 million small and medium-sized businesses.
RIL and Jio’s corporate development, strategy, and M&A teams are now examining whether any investment or acquisition is worthwhile at this stage, a recent report by ET cites people with knowledge of the matter.
As of now, RIL has declined to comment on the development and has dismissed them as “speculation and rumours”.

“Our company evaluates numerous opportunities on an ongoing basis. We have made and will be continually making necessary disclosures in compliance with our obligations under SEBI rules and our agreements with the stock exchanges,” as told by the RIL spokesperson to the publication.
With India once the biggest market for TikTok, it is likely that the app will push for re-entry into the country’s market through such a deal.
For now, though, RIL is likely to “strategically” decide to go on with the deal based on the valuation of the company in the coming days.

Written by: Sohini Banerjee, Abhrajyoti Kundu.

Poster: Abhisek Baral

Trailblazers #3: An Interview with Mr.Vishal Kumar

KGEC E Cell recently played host to Mr. Vishal Kumar, CEO and founder of learningwhiletravelling.com on the occasion of Egnition ’19,the freshers’ orientation program of Kalyani Governement Engineering College’s Entrepreneurship Cell. He did his bachelors from IIT Kharagpur and post-graduation from UBC, Vancouver, Canada. He had worked in oil and gas industries in Canada, Singapore and Indonesia. Not sure about pursuing an MBA and after visiting many B-schools in a 100-day world tour itinerary, he dropped his MBA plan and invested his savings in his startup. He has been to 25 countries to date. Mr.Vishal’s brainchild the International Startup Enrichment Tour” aims to help all startups get a global platform to extend their cross border trade, investment and network. He is also working on establishing E-Cells in schools and colleges where LWT is supporting the students from ‘idea’ to ‘incubation’ (zero to one). The startups from these colleges gain a lot of exposure while traveling and participating in various national and international e-summits at different parts of the globe.

Here are some of the excerpts :

KGEC E Cell: What is the inspiration behind this startup ?

Vishal Kumar: Having travelled a lot (25 countries, till date), I see myself as an upgraded person after each travel. Travel can be used as a means for a person to upgrade themselves. A person who has travelled a lot can learn about different cultures and can change his way of thinking. Scholarship in the form of flight tickets is a very good motivation for youth to experience foreign culture and this will change their mindset and eventually upgrade India.

KEC: Why have you chosen Singapore as the city ?

VK: I used to live in Singapore and it is a well developed city with many amenities. So, instead of connecting Mumbai and Bangalore (cities which were more developed) to Singapore I decided to connect Kolkata and its surrounding areas because of higher growth. Also, it is not very far from Kolkata and the travel is inexpensive. Singapore is also a very good role model for India and there is a lot of encouragements for startups as well. This will boost tourism and entrepreneurship in both countries as well.

KEC: What according to you does it take to be  a successful entrepreneur?

VK: A successful entrepreneur has to be self motivated because there is no one to motivate them through the tough times. You might be feeling low everyday for a variety of reasons – starting from inadequate supply of money or the people who are working under you are unable to follow you. So, there needs to be a consistent drive, zeal and passion from within to tide over the tough times.

KEC: How do you deal with hardships and failures?

VK: That’s an interesting question : If the world laughs at me, I’ll laugh back at them later.  Entrepreneurship is a great leveler. Even someone with an IIT tag has the same chances as that of a non IITian and there is no edge whatsoever. You must be willing to accept whatever comes your way as it is the same playing field.

KEC: That is the most demotivating thing for us, because we are not from an IIT

People do  an MBA to wipe the sin of engineering

VK: People do  an MBA to wipe the sin of engineering. So, if you can create a startup you can upgrade your overall life. So, definitely trying is the main factor here.

KEC: Please share if you have any successful incidents.

VK: Initially, for our pilot project we had a Bangkok trip which consisted of around 20 – 30 people, for a duration of 3 days. It was a very hard task gathering that many people who would turn up because everyone thought that our free trip was a scam, with hidden terms and conditions. Later, we were able to gather around 70 people for a semi sponsored one week trip to Singapore. We had visa issues but then everything started to fall into place.

KEC: What are the things that you would like to achieve in the future?

VK: We would like one representative from every school and college in India for our foreign trip. We would give them the option of all 200 countries. Getting young people into entrepreneurship early is the key to maintaining a viable startup ecosystem. Due to parental and societal pressure kids do not get an opportunity to be an entrepreneur. Our main motive here is to groom young people early on topics such as sales marketing and finances such that they are not a job seeker, but a job giver.

KEC: What were the initial hurdles you had to overcome ?

VK: Capital was not an issue for us because it was a bootstrapped venture. The main hurdle was that many people did not believe in us because they thought that it was a scam. It was very difficult to get people on board with us. Later, when we became successful we were called for TV interviews. So, now the coin has flipped.

KEC: What was the Singapore trip all about ?

VK: It was all about getting all the strangers under one roof. Everyone gathered at Kolkata and we started giving them different activities. The B-plan contest started on the plane itself. It was followed by lectures at various colleges at Singapore and conference at Marina Bay Sands, a 7 star hotel. There was also an optional Kaplan certification course and pitching plans at the Singapore Chamber of Commerce. Participants also met the Transport Minister of Singapore. So, overall it was a mesmerising experience for everyone and especially for those who were out of India for the very first time.

KEC: Please describe your business model.

VK: We follow two kinds of business models: The Jio sim model which is a freemium based model where we give away free tickets to the participants; the other, IITJEE kind of model where a lot of people pay an application fee and very few people get selected. So, we will give away the tickets as a prize of a very high competition and we will get the revenue from the application fees itself. So, ultimately we will be going for a merit cum means scholarship. We are also trying to introduce entrepreneurship into the school and college curricula such that the cost can be covered by an educational loan.

KEC: Last but not the least, are you hiring ?

VK: Although, we are not hiring full time people we do have positions for summer interns. These are creative positions that will require negotiating skills to get sponsorship from corporate companies as well as the Government. They need additional skills such as sales, marketing and they need to be able to execute the trip. We will eventually hire a team for all 200+ country’s program which totals to around 500-1000 people.

For more details please watch,

Reported by –

Sanghamitra Biswas

 

Trillion Dollar Companies

Since the dawn of Industrial Revolution springing it’s a root from Britain to the other countries in the 18th Century, many Individuals rose to set the first in class Industries to meet the demands for new and better Infrastructure, handling complex manufacturing and producing new jobs for the working class. Gaining an upper hand in terms of technology and establishing itself as a Diplomatic Superpower has always been the lucrative desire for all countries. One criterion which solidifies this ambition is having better Financial asset and pumping a ton of money in the Economy.

Image 1: (Image courtesy: crn.com)

The Industries kept setting the bar higher and higher, scaling them up and bringing more revenue. Standard procedures were created to measure and keep a record of a much larger number. Every country more or less uses their Imperial system. In India lakhs and Crores are used, in America, it’s termed in Millions and Billions. Let’s first get our numbers checked and be a bit familiar with the more used American units in the International market.

To put things in Indian perspective:

1 lakhs = 100000 INR

1 Million = 10 lakhs

1 Billion = 1000 Million

1 Trillion = 1000 Billion

With the rising valuation of Companies market share, our milestone has changed significantly in the past decades from Millions to Billions and few companies even crossing the Trillion Dollars mark. Let’s take a dip and see what these companies are and who are in their way of becoming

Image 2: Countries in Trillion Dollar Companies Club (Image Courtesy: reddit.com)

Companies	Date surpassing 1 Trillion Dollars mark	Market Capitalization (In USD)
Apple Inc	4 August 2018	$ 1.37 Trillion
Amazon	4 September 2018	$ 1.04 Trillion
Microsoft	7 June 2019	$ 1.36 Trillion
Saudi Aramco	11 December 2019	$ 1.81 Trillion
Alphabet	16 January 2020	$ 1.02 Trillion

Table 1: List of Trillion Dollar Companies

Apple: Apple became the first company to hit the 1 Trillion mark in August 2018. It already claims to be the World’s most valuable listed Business for several years. Although it fell to $ 800 billion by the end of 2018 (owing to the US Stock Market slump), it regained its position in the top few in 2019.

Amazon : Amazon followed the league to the top just after a month after Apple. The 2018 market slump also hit Amazon badly but it took longer for the E-commerce giant longer to recover and it rejoined the Four-comma club in January 2020 due to its rapidly growing Prime Subscription service.

Microsoft : By the end of 2018, Microsoft had overtaken it’s long-standing rival Apple to become the World’s most valuable company, a title which it holds for most of 2019 period. It joined the club in mid of that year. Its massive growth was fuelled by its business’s cloud computing division, Azure

Saudi Aramco: Saudi Aramco broke the Trillion Dollars barrier on its very first day of trading, due to the overhype created by analyst and commentators. At the end of the first day, it hits a value of $ 1.88 Trillion making it by far the biggest IPO in history and Saudi Aramco joining the league. Next trading day and Saudi Aramco broke another record of becoming first to get to $ 2 Trillion

• Another Non-US company were claimed to hit the Trillion dollar bell was PetroChina getting market capitalization of $ 1.194 Trillion on the first day of it’s IPO way back in 2007 (more than a decade ago of Apple). However, the valuation was only based on a fraction of its share and the company sank soon after with its market cap dropped to $260 billion in 2008.

Alphabet : The newest of the members of the Elitegroup. Google’s parent company Alphabetbecame the fourth US tech company to get a market capitalization of $ 1.02 Trillion.

Although the Trillion Dollars Valuation gives a good measure of the companies accomplishment it does not provide the complete story of the overall economic health of the company and Investors tends to not get much into the glittery gold often.

If we adjust for Inflation we might get some surprising new names whose valuation would easily dwarf these top companies combined by a significant amount. It is truly fascinating that Dutch East India Company, which existed nearly 400 years ago, would have a market capitalization of a whopping $7.9 Trillion.

Image 3: The Trillion Dollar Club (Image courtesy: visualcapitalist.com)

Okay let’s now have a look at the most promising future contenders of the big Trillion club:

Facebook : With a total market capitalization of $599 billion, Facebook is well on its way to the breakthrough the mark. Facebook is also the only member of the US ‘big five’ tech giants not surpassed $1 Trillion value.

Berkshire Hathaway: Warren Buffett’s Berkshire Hathaway is not very far off from Facebook in the race to the trillions with its market cap of $560 billion. But it’s growth has been much slower than the Tech Rivals but it’s also more steady then it’s competitors and you cannot doubt Mr Buffett in his game.

Visa : Visa performed brilliantly in 2019 becoming one of the most valuable public company recently with a market cap of $499 billion. It grew 50% in value in 2019 and could be in the league by 2023 if it continues to leverage on the soar of cashless payments.

With these three in the lead position currently they odds are in favour of these companies but in no way mean that they will cross the mark. Business is full of uncertainties and things can change at a rapid pace.

Written by : Deb Das Jha

Edited by : Shubhangi Dey and Sarthak Mazumder

Vodaphone Idea merger Detailed Report

INTRODUCTION

The Indian telecom industry has been in the grip of consolidation ever since the trading of spectrum licenses was legalised in October 2015. India’s Telecommunication network is second largest within the world by several telephone users with 1.2 billion subscribers. In the interest of increasing competition, innovation and facilitating businesses, the Department of Telecommunications (DoT) liberalised the spectrum and allowed telecom companies to transfer their airwaves rights, subject to certain restrictions. Videocon Telecommunications took the lead and monetised its spectrum rights by selling it to Idea in several circles soon after the liberalisation move. Market consolidation in the telecom industry is not peculiar to India. In 2017, Vodafone and Idea announced a merger that was expected to create India’s largest telecom operator with more than 400 million subscribers and fuel the ongoing market consolidation. The merger results in Indian telecom sector being dominated by four players- Vodafone-Idea, Bharti Airtel, Jio and BSNL. It also kick-starts the process of renewing price discipline in an industry, which is still reeling under the shock of Jio’s disruptive entry.

COMPANY BACKGROUND

Vodafone Idea Ltd. has rebranded itself as ‘Vi’ nearly after two years the telecom operators merged as a results of a brutal tariff war effected by Reliance Jio Infocomm Ltd.

Vodafone

Vodafone India is a subsidiary of London based Vodafone Group Plc, the second-largest mobile phone company within the world. Vodafone entered the Indian market in 2007 by acquiring a 67% stake in Hutchison Essar for $10.7 billion. The business was owned by Hutchison Whampoa Ltd and Essar was a minority stakeholder. The company was renamed as Vodafone Essar and ‘Hutch’ was rebranded to ‘Vodafone’. Vodafone had a right of first offer (ROFR) vis-à-vis Essar, which it exercised in 2001 to buy out Essar’s 33% stake for $5.46 billion. Vodafone acquired 74% shareholding, which was later increased to 100% by 2014. The 2007 deal, which secured Vodafone’s entry into the Indian market is embroiled in a tax dispute. Vodafone faces the grim prospect of having to meet a huge bill of about ₹14,000 crores, were it to lose the arbitral challenge to the tax claim.

Idea

Idea Cellular Limited was the third-largest mobile network operator in India. It functioned in its early years as a three-way joint venture involving the Tata Group, U.S. telecommunications behemoth AT&T, and the Aditya Birla Group (AB Group). The idea was incorporated in 1995 with its registered office in Ahmedabad. In a decade, the company went public and it was listed in 2007. The idea has been a very successful telecom giant and it has consistently reported net profits from its services rendered to its 191 million-strong subscriber bases. The company posted its first net loss since listing in 2007 in the December quarter, hurt by the price war following Jio’s offerings.

Image 1: Shareholding Post-Merger of Vodafone Idea

TRANSACTION DETAILS MERGER VALUATION & MOTIVATIONS

As per the official figures released by the companies, the value of the new entity post-merger is $23 billion but some analysts argue that the deal is undervalued by at least 23%. The companies claim that the merger is largely motivated by their commitment towards Digital India. Market analysts believe that it is an essential survival mechanism after the market disruption caused by Jio, as far as Idea is concerned. The need for merge arises to get the full benefit of the synergy and with synergy benefit, it results in higher profits and leverage expected to reduce, the combined entity’s equality valuation also rises. The merge will help in reducing the effect of tariff war that generally occurs in the Telecommunication market. Also, both of the company can enjoy benefits in terms of network and also in terms of services. Analysts locate Vodafone’s main aim in its intentions to deconsolidate its Indian operations.

Image 2: Post-consolidation market share based on 31/12/2016

DEAL BREAKDOWN

On 20 March 2017, Vodafone India and Idea cellular agreed to merge and expected to create the biggest telecom company in India with a customer base of over 400 million. The transaction will start with stock transfer and the deconsolidation of the Indian operations of Vodafone. As part of the deconsolidation process, Vodafone India will be separated from its parent entity-Vodafone Group Plc- and it will be treated as a Joint Venture (JV), reducing Vodafone Group’s net debt by Rs 55,200 crore. Vodafone India owns 45.1% entity after transferring 4.95 to the promoters of idea cellular for Rs of 3874 crores in cash post the merger. The promoter of Idea Group will hold 26% and the rest of the shares will be owned by the public so we can say that it is a 50 50 partnership. The deal contours can be broken down into the four steps through which the companies aim to attain share equalisation.

BOARD COMPOSITION & VOTING RIGHTS

Vodafone will appoint the Chief Financial Officer (CFO) and Kumar Mangalam Birla will be the Chairman of the Board. The CEO and COO will be chosen upon mutual consent before the closure of the merger. The promoters of Idea and Vodafone will have the right to nominate three members each on the board, which will have 12 directors, six of whom will be independent.

AB Group and Vodafone will exercise their votes jointly and the voting power of Vodafone will be proportionately reduced until share equalisation is achieved.

MERGER RATIO

The implied swap ratio is 1:1 and it is based on Idea’s price of Rs 72.5 a unit. The implied enterprise value is Rs 82,800 crore for Vodafone India and Rs 72,000 crores for Idea.

Image 3: Wireless Subscribers Pre-Merger as on 31st August 2015

INITIAL CONTRIBUTIONS TO THE JOINT VENTURE

Vodafone contributed all of its Indian businesses including its standalone towers with 15.8k tenancies but barring its 42% stake in Indus Towers. All of Idea’s assets including standalone towers with 15.4k tenancies and its 11.15% stake in Indus Towers will vest in the new entity.

NET DEBTS

Idea’s net debt was Rs 52,700 crore in December 2016. Vodafone would contribute Rs 55,200 crore of net debt to the merged entity. The combined entity would remain highly leveraged and will need some form of capital infusion.

The merger agreement has a break-fee of Rs 3,300 crore payable under certain circumstances.

SIGNIFICANT COST-CUTS

Mergers in telecom industry help in reducing redundancies and consolidating customer base. Vodafone and Idea both hold stake in Indus Towers and they lease cell towers at certain prices. Post-merger, Vodafone’s 42% stake in Indus Towers will remain whereas Idea will dispose of its shareholding. This will eliminate redundant costs since there will be a common expenditure on cell tower tenancies. Sharing of infrastructure will thus significantly decrease the costs of the new entity.

WIDER MARKET REACH

Post-merger the new entity has greater access to fibre cables for 4G and 5G network. Vodafone is the market leader in Urban circles and Idea is a key player in category B circles. The merger will allow the new entity to have a stronghold in both urban and rural areas. The new entity will be the market leader in 12 out of the 22 circles, and it will be only behind Airtel in nine circles.

Image 4: Wireless Subscribers Post-Merger as on 31st May 2020

UNADDRESSED ISSUES & POTENTIAL RISKS

The companies have not identified a mode of deadlock resolution. It is generally advisable to devise mechanisms to resolve an impasse in case of equal joint ventures. Otherwise, there could be unavoidable deterrence to the effective functioning of the Board. For instance, the equal division of powers concerning the appointment of Key Managerial Personnel (KMP) could create conflict. In the past, where clear terms of appointed existed, there have been huge controversies as seen in the merger between HDFC Life Insurance Co. Ltd and Max Life Insurance Co. Ltd, which created India’s largest private insurer. The shareholder agreement contemplates modes for further capital infusion neither during the lock-in period nor posts the four-year timeframe. This is important because the new entity will be highly leveraged and debt financing may not be feasible. Additional capital contribution by the JV parties involves several considerations. To maintain equal shareholding, both parties will have to make the same amount of value addition. The liquidity and the capacity of the JV parties may not permit equal capital infusion when the JV entity needs it. Further, the merger agreement does not discuss protections for foreground and background Intellectual Property of the JV parties. Indemnity provisions are also conspicuous in their absence. The JV parties have declared their intention to synergise operations but there is no clarity on the integration of supply chain and other verticals.

CONCLUSION

Vodafone has made its Indian operations subservient to its global goals. The world’s second-largest company has invested circa £19 billion over the last three years to increase its coverage in the United Kingdom as part of its ‘Project Spring program’. Overall consolidation in the debt-ridden telecom industry will lead to better financial health and sustainability of both the companies. Since consolidation will leave only three big companies in the industry, there will be less competition and bigger revenue. It will also result in duplication of resources across country which requires job cuts too. The merger will also lead to pooling of vital resources and infrastructure, which will inevitably lead to better service quality and customer satisfaction as both the companies are working on better coverage of 4G and 5G. It is undeniable that the deal is necessary for both parties after the competitive pricing onslaught brought on by Jio. However, when a corporate marriage is a response to an outside threat and global financial concerns, the scope for adverse consequences for the parties involved is much higher. A major beneficiary of consolidation in the sector and the merger of Vodafone and Idea operations is the consumer as the three top players (Bharti Airtel, Idea-Vodafone and Reliance Jio) will bring in best technology at best prices to retain customers in a sector where brand loyalty has been diluted by Mobile Number Portability. Vodafone and Idea have also announced their plan to explore flexible business diversification opportunities along the lines of Airtel’s tryst with Wynk app and Airtel Money. The two companies are also hoping to capitalise on the first-mover advantage in the Internet of Things (IoT) market in India by commercially offering smart cars and connected homes at affordable prices. Vodafone and Idea hope to collaborate with other investors in implementing their plans for the future so that they can limit exposure and maximise synergistic capabilities. Only time will tell how much of their hopes and plans will materialise into realities in the coming future.

Written by: Animesh Bhakat and Apurba Banerjee
Edited by: Shubhangi Dey and Sarthak Mazumder

India Ideas Summit 2020:Building a Better Future|PM Modi urges US investment

Delivering his keynote address at the India Ideas Summit 2020 on 22nd July, Prime Minister Narendra Modi emphasized the contribution of India towards the World Economy while saying this is the best time to invest in India. Especially US firms must make use of this opportunity for the mutual growth of both countries. It’s been assessed as diplomatic and economic warfare against the Chinese economy.

The summit, organized by the US-India Business Council, marks the 45th anniversary of its formation, featuring the theme of Building a Better Future.

There is a Global optimism towards India, as it offers a perfect combination of openness, opportunities, and options. The Prime Minister further highlighted how India celebrates openness in people and governance.

Highlights of PM Modi’s Speech:

1)In this pandemic situation, global economic resilience can be achieved by stronger domestic economic capacities. This means improved domestic capacity for manufacturing, restoring the health of the financial system, and diversification of international trade.

2) India is emerging as a land of opportunities. Recently, an interesting report came out in India which stated that for the first time, there are more rural internet users than urban internet users. Opportunities in technology also include those in the frontier technologies of 5G, big data analytics, quantum computing, block-chain, and the internet of things.

3)The PM highlighted how India invites companies to invest in finance and insurance. India has raised FDI cap for investment in insurance to 49%. Now 100% FDI is permitted in insurance intermediaries.

4)The PM spoke about how during the last six years, we have made many efforts to make our economy more open and reform-oriented. Reforms have ensured increased ‘competitiveness’, enhanced ‘transparency’, expanded ‘digitization’, greater ‘innovation’ and more ‘policy stability’

5) “India invites you to invest in the hard work of our farmers. There are investment opportunities in the farming sector” says PM Modi. The best time to invest in agriculture is now as India and US have built a robust partnership in the farming sector according to PM.

6) This is also the best time to expand in the health care sector. The PM also reflected how India is contributing towards a prosperous and resilient world through the clarion call of an ‘Atmanirbhar Bharat’. And, for that, the partnership of investors is awaited.

7) “Recent experience has taught us that the global economy has been too focused on efficiency and optimization. Efficiency is a good thing. But, on the way, we forgot to focus on something equally important, that is “resilience against external shocks” says Prime Minister, Narendra Modi.

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Written by: Arka Dutta and Sarbodaman Banerjee

Edited by: Dibyajyoti Ghosh

How the digital market is affected after India banned 59 apps linked to china

The Central government on Monday, 29 June 2020, banned 59 apps with links to China. These apps were banned after weeks of furious debate as their policies regarding data safety came under question. The ban included several popular mobile apps, most notably TikTok, UCBrowser, Camscanner, Xender, and many more. Together, these apps have several hundred million users in the country. The move comes in the backdrop of the present impasse at the line of control in Ladakh with the Chinese troops.

Let’s dive deep to have a view of the situation on a broader prospect.

TIKTOK

The biggest casualty of this move appears to be ByteDance. ByteDance-owned TikTok is targeting ₹100 crore revenue in India for the July-September quarter this fiscal year as reported by Entrackr. However, within minutes of the announcement of the Chinese app ban, the Indian government’s TikTok account MyGov, which had 1.1 million followers, was disabled. According to a report published by China’s state-run media The Global Times, ByteDance – the parent company of the TikTok and Helo apps could lose up to $6 billion( ₹45k crore) after the Indian Government decides to ban them.

Some of the most common examples for TikTok substitutes that come with the same core idea as the TikTok, of sharing short videos of 20 seconds are:

Mitron: An Indian video-making app

Chingari : It crossed the 2.5 million download mark recently.

Youtube Shorts: A short video format on which Youtube is currently working on but it is not yet official when the feature will be rolled out.

Bolo Indya: Another Indian app developed by SynergyByte Media Pvt Ltd. Roposo: The oldest app here and is available for download on the Play Store and App Store

SHEIN

Shein, a fashion brand app, has been a go-to shopping website primarily for women and girls over the years. specializing in trendy women’s clothes that are mostly priced below US$20, with some items even selling for less than US$5. The company started in China’s eastern city of Nanjing back in 2008. Now it boasts of its presence in nearly every country in the world and has made more than 20 billion yuan (US$2.83 billion) in revenue in 2019, according to a WeChat post from Shein in February this year. Shein, which entered India in 2017, has localized its customer service, logistics, and marketing efforts in the country and with ₹250 crores invested in marketing, it receives 20,000 orders a day, according to Shein India general manager Malcolm Yam. It now has around 3 million followers on social media and collaborated with about 2,000 influencers. Alternatives to this app include homegrown brands like Ajio, Myntra, Amazon, Snapdeal, Flipkart, and Nykaa.

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XENDER

Xender is one of the world’s leading apps, developed by a Chinese tech company called Xender Digital Technology Private Limited, founded by Peter Jiang in the year 2011 which lets users enjoy transferring files like photos, music, contacts, videos and apps in the best possible manner. It has logged 170 million Indian users over the last three years along with an annual growth rate of over 100 percent. Xender has been launched in more than 22 countries by now but one of the biggest markets for Xender is in India given those big companies like Micromax pre-install the application before selling it to the customers. Besides the other parts of India, the application is also gaining popularity in the northern parts of the country especially in the areas where internet connections are not so strong. After the next couple of years, Xender has taken a gigantic step by coming into a partnership with SONY India for MovieChain Project. However, After the ban of the app over security and privacy concerns, the following apps will be in rising:

Files by Google

Launched in 2017 as Files Go along with offline file sharing, the app lets users manage and browse their files. Currently, the app is only available on android.

Send Anywhere

The Send Anywhere app also lets its users share files using Wi-Fi direct. The app is available on both android and iOS.

JioSwitch

JioSwitch also lets users share files with other devices offline

UC BROWSER

UC Browser is a web browser developed by Chinese mobile internet company UCWeb, a subsidiary of the Alibaba Group. It is known for its low network requirements and is the 8^th most downloaded app in the last decade. It has been particularly popular in India, as people in areas with a slow internet connection would prefer the app over others, and is also available in several Indian languages.

Its ban is likely to narrow the growth of UCWeb as well as corporate giant Alibaba significantly, as India has been a huge part of their customer base. Alibaba has been repeatedly accused of having loose policies for user data security and has been subject to heated debate several times. This is, however, the first time it has faced such a vicious reaction on the issue. Alternatives to this app would be browsers like Google Chrome, Microsoft Edge, Bharat Browser, Opera, and Firefox.

CAM SCANNER

CamScanner is a mobile app owned by a Chinese company named Intsig Information Co. Ltd. It was released in February 2017 and uses the phone camera as a photo scanner. It is largely used by students in India, due to the easy and effective system of scanning and sharing work in an electronic document. It is owned by a Chinese company named Intsig Information Co. Ltd. In August 2019, Kaspersky Lab found that several versions of the app contained a trojan dropper, which installed a few hidden Zip files into the device when CamScanner was installed into the advertising library. These files were found to download other files, controlled by hackers in China, that allowed them to receive all of the user’s data in the device.

This caused Google to take it down from PlayStore, but later the app was made available again after they had removed the library altogether. With the ban from India, CamScanner loses its largest customer base, which is likely to curtail its growth significantly, and lead to a great drop in the valuation of Intsig Information Co. Ltd. Alternatives to this app are Adobe Scan, Microsoft office lens, PhotoScan, TurboScan, and TapScanner.

CLEAN MASTER

This smartphone junk cleaner and virus detector software called the Clean Master app was made by a China-based tech company Cheetah Mobile, headquartered in the city of Beijing. At its peak, Clean Master was a quite popular app with over a billion downloads and it can be assumed that the app remains installed on millions of smartphones.

According to a report by Forbes, Clean Master has been collecting all manner of private Web user data that a security firm shared with Google. This app has reportedly compromised the safety and security of user data and privacy. To safeguard the Indian Cyberspace and the privacy of numerous users it has been banned by the Ministry of Home Affairs. Thereafter Cheetah’s revenue fell 51% annually to 528.1 million yuan ($74.6 million) during the quarter. It posted an adjusted net loss of 97.7 million yuan ($13.8 million), or $0.10 per ADS, compared to a profit of 33.8 million yuan a year ago. Google and Facebook both claimed that this app defrauded advertisers by “injecting” background clicks without any user interaction. Facebook ended its ad partnership with Cheetah in 2018, and Google booted Cheetah’s apps from the Play Store and its ad platforms earlier this year.

Alterntives to Clean Master App:

Norton Clean, CCleaner, and Files by Google

WE CHAT:

WeChat is a Chinese all-in-one messaging, social media, and mobile payment app developed by Tencent. As of August 2019, WeChat has 3.5M fans on Facebook and 250.3K followers on Twitter and estimated annual revenue of 24.1M. However, the app inspects messages, photos, and content shared on the platform and stores them with user info. It’s easily accessible to the Chinese government, making it no less than spyware which forced the Ministry of Home Affairs, ban this app.

A recent report by QuestMobile indicates that the time spent on the WeChat App dropped by 8.6% between December 2018 and June 2019.

YOY growth of Tencent advertising has reached a low of 16% for Q2 2019. The growth of Tencent’s ad revenues is following a steady downward trend for the last year.

Alternatives to WeChat:

Whatsapp and Telegram

Conclusion: India is the fastest-growing consumer of the digital market in the world which is the second largest for app downloads. But at this point, the biggest question is – Does Aatmanirbhar India have the alternative apps to quickly fill the void created due to the ban on Chinese apps? Well, we may find our answer in the near future.

Written By: Ayndrila Ghosh, Ritoja Sen and Deepshikha Sen

Edited By: Suvro Mukherjee

Q&A with Mr. Sourav Saha: A session with Germentor.

Just a few days left for our annual flagship event E-summit’20. Considering all the constraints it is going to be hosted totally online with eminent industry experts .Before that let’s have a look on the Question Answer session with Mr. Sourav Saha – Chief Mentor at Germentor – our co-sponsor for E-Summit 2020, an initiative from IIT/IIM alumnus and industry experts to nurture budding innovators and entrepreneurs.

Q1: Let’s start from beginning, tell something about yourself and your corporate journey before Germentor happened.

A1: Well, after finishing my Masters in Solid State Electronics from IIT Roorkee, I was straight into VLSI/Semiconductor industry starting with Intel as campus hire. Since then, for 14 years I worked in different MNCs in semiconductor arena and across diverse technology spectrum. Most of my time went into high performance microprocessor design for server and mobile spaces. Since, 2012, I had opportunity to get mentored on idea generation, patent filings (50+ granted so far), start-up idea mentoring etc within or outside organization etc. At the same time, I was working with academia (IITs/NITs) to groom interns, strategic research collaboration etc. Then at starting of 2017-18, I took few specialization courses to dive into ideation process and how it blends with intellectual property generation and entrepreneurship aspect. All these and some other individual and collaborative ideas put together – Germentor was envisioned in 2019.

Q2: You co-founded ImpactLife Solutions in 2019 after your MNC stint. Tell something about vision for this company.

A2: Over last 4-5 years, we had many time varying ideas and brainstorming on how to impact and enrich lives through certain initiatives. Some of the ideas we shortlisted and then needed an official entity to work on these on a continuous basis. We couldn’t figure out a better name than ImpactLife Solutions 😊. Apart from ideation specific initiative Germentor, some of our current focus area includes 1-on-1 knowledge consulting platforms, interactive and virtual volunteering, enabling complete mind-body healing paradigm etc. We are trying to make them deployed in 2020-21.

Q3: Coming back to Germentor, share your perspective why initiative like this is necessary.

A3: We realized in current socio-economic condition (that includes ongoing COVID-19), pureplay engineering skillset may not be sufficient enough to survive and excel in long term career. Irrespective of whether someone want to become entrepreneur or not, ideation skills need to be part of engineering DNA; very similar to core engineering papers like engineering maths, physics, mechanics etc. There is art and science of ideation which needs to be mastered and kept in repository to make use at right time and with quick turnaround time. This philosophy is core focus of Germentor and natural outcome like intellectual property generation and intra/entre-preneurship are all holistically brought under a common umbrella. We are also expanding this concept to non-engineering students/professionals towards inclusive innovation journey.

Q4: Sounds interesting, what are the kind of activities currently going on under Germentor initiative? Please throw some lights.

A4: To start with, we have come up with a structured training platform called IdeaBooster where multiple trainings are offered in this space. These are offered online and live with domain experts and small batches ensuring ample interaction and case-study based practical approach, rather than a recorded material or theoretical lecture notes. We want to make sure after some of these trainings, confidence go high for participants to innovate end-to-end and immerse into the eco-system. Apart from that, we have an initiative called LaunchPad where we nurture few selective ideas from concept thru technology demonstration or commercial roll-out.

Q5: Where is current spread of Germentor and how someone can get connected?

A5: We are end-to-end online and hence there is no restriction in reaching out to any part of India and beyond. Our strategic academic partners are distributed in different states and even in other countries, where we are connected to student and faculty community through dedicated engagement model. Apart from that, we often give few trainings to general student group also who reaches us. We are starting a direct student registration portal in July and based on response, we’ll offer more trainings to general student communities in future. Anyone can reach us at germentor@impactlife.in or visit us at www.germentor.in to stay updated.

Q6: Thanks for sharing Germentor initiative details. Before we conclude, few words on what is planned in future?

A6: There are immense possibilities and initiatives in this field. Not everything can be revealed at this time 😊. However, there are some thought of creating idea bank with different stage of maturity with our partners. Stay tuned.

Adobe pulling off the support for flash at the end of 2020. Is it the end of the era?

Adobe Systems plans to phase out its flash player plug-in by the end of 2020. It was a dominant player in early days of internet and was used in variety of games, animations and video streaming as well.

           But it was only in the year 2014, Google estimated that more than 80% of the users used flash based content everyday on the net which eventually declined to 17% in late 2018 and now to less than 5%. This revealed the present trend of the sites migrating to open-web technologies. Adobe systems has also been working in partnership with Apple, Mozilla and Microsoft for discontinuing the Flash and its replacement by more current browsers.

2020 will mark an end of an era for Flash, but one feels like it has been a long time coming. HTML5 standards have been implemented across all modern web browsers, and the need for Flash just isn’t there anymore. An end to Flash will bring with it obvious improvements in security and enhance pure battery life on laptops and other mobile devices that still support the web technology.

So why exactly did this thing happen? What are the factors that led to the sudden demise of Flash player?

Primarily Apple, in a sense, gave Flash the kiss of death, when it took the Flash Player out of the iPhone in 2010.The factors of phasing out the Flash player are as follows:-

 

• Relatively old plug-in: Being relatively old plug-in, it had flaws in code which made it increasingly vulnerable to online threats like hackers and viruses.

• It never saw the mobile revolution coming:  Designed especially for desktop computers it was barely optimized for displaying contents in mobile devices, which reduced performance, reliability and increased battery drain issue and security threats for mobile devices.

• Closed source program: For flash player being 100% proprietary, Adobe holds the sole right for further enhancements, availability, accessibility and pricing. In such situation users were just paying only to use it and not to buy it.

• Withdrawal of support from major Tech Giants: Apple’s CEO, Steve Jobs put an end to the relationship with Adobe, highlighting its concerns about its reliability, security and performance. Technology partners like Mozilla, Facebook, Microsoft, Google also followed suit and initiated their migration towards open web technologies post Adobe’s 2020 proclamation.

     With the growing popularity of newer programs such as HTML5, WebGL, Web assembly popular web browsers like Google Chrome, Safari, Mozilla Firefox, Microsoft Edge and Internet Explorer are already half way through their roadmap of putting last nails on the Flash player coffin by disabling its support by default and many web sites and web pages are still being updated to modern standards that contained flash content. Still phasing out of Flash player will have some noticeable impact worldwide web community.

The data that shows how the use of Flash gradually diminished over the years.

• Increased security concerns: With the end of life of Flash, there will be no more security patch updates from Adobe, consequently the web pages or websites that has still not been updated to modern standards may face certain vulnerabilities thereby creating a gap in the company’s network security.

• Some vintage flash games might die-off: Many online flash games website like Miniclip, Gams ODO, Kongregate and online game development websites like Ceil fire, Kongregate Labs, Game  etc. might die if they don’t port to modern standards considering the user base it still has.

• Dormant flash based websites won’t open: There are thousands of websites and web pages that still uses flash and are not updated lately. And the problem is they need significant investment to convert or update them to newer technologies that can be used on the web.

• e-Learning and legacy courses might be at risk: Most of the older resources and e-Learning platforms still use flash plug-in. With the Imminent end of flash some flash based e-Learning and legacy courses might come to stand still.What are the changes that user interface would require due to this change?

  Effects on Browser community:-

  “With Flash technology becoming unsupported, businesses and industries built around the technology will need to make the decision to either keep using an unsupported piece of software or to find a new technology to build their business upon. Patches will no longer be released for the software, and if businesses choose to keep using Flash, an imminent security threat could arise.” – David Lefever, The Mako Group.

  Flash will initially be disabled, and the user will need to re-enable Flash on a site-by-site basis; Flash will be completely removed from the browser towards the end of 2020. Group policies are available for enterprise admins and IT pros to change the Flash behavior prior to that date.

  For both the in-market version of Microsoft Edge (built on EdgeHTML) and Internet Explorer 11, the current experience will continue as-is through 2019. Specifically, they no longer intend to update either Microsoft Edge (built on EdgeHTML) or Internet Explorer 11 to disable Flash by default. They still plan to fully remove Flash from these browsers by December 2020, as originally communicated.

   

   

  As open standards like HTML5, WebGL and WebAssembly have matured over the past few years, most of them now provide many of the capabilities and functionalities that plugins pioneered and have become a viable alternative for content on the web. Over time, they have seen helper apps evolve to become plugins, and more recently, have seen many of these plugin capabilities get incorporated into open web standards. Today, most browser vendors are integrating capabilities once provided by plugins directly into browsers and deprecating plugins.

  
  Some of the positive impacts of phasing out flash player for the browsing community can be briefed as:

   

• Better user experience: Being too heavy its misuse by hackers have always annoyed the users online. So by removing flash content and resorting to open web technologies that doesn’t need any third party plug-in it is inevitable to bring about a better user experience.
• Will promote a mobile first approach: Mobile phones have been the primary browsing tool among mainstreams. Flash was difficult to integrate with mobile technology and had lack of support on both iOS and Android. So phasing out of flash will push businesses to opt for mobile friendly technologies.
• Better internet security: Flash became the prime target for hackers online and was not the most secure technology to begin with. Thus, no support for flash and adoption of open web technologies means that anyone can contribute for improving in security and will benefit business and home users.
• Also open web technology will enable the businesses to decide on how their websites will look different on different devices and faster loading of graphical content.Facebook says that it will help game developers on its platform migrate to open web standards.

   A lot of e-Commerce and web service startups with flash content on their pages have already been updated to modern standards like HTML5, WebGL, Unity etc. and any of these startups that want to continue their service needs to update their websites by the end of 2020.

  Conclusion:

  Given its wide distribution, Flash (and especially outdated versions of it) quickly became one of the main targets for hackers, and Flash offered them plenty of avenues for trying to get into their target’s machines. The fact that Apple never supported it on mobile (and Steve Job’s famous 2010 letter about that) only sped up Flash’s demise, especially as modern browsers and HTML5 allowed browser vendors to replicate Flash’s functionality without the need for third-party plugins. To be fair, Adobe probably wanted Flash do go away as much as everybody else and, by 2015, the company said as much. Since then, it has started to phase out Flash support from its applications and worked on providing its users with alternatives.

  Similarly, browser vendors have also started deprecating Flash support over the last few years. Google made Flash a “click-to-play” plugin, for example,  users must explicitly enable if they really want to use it. The same holds true for all other major browser vendors.

  At this point, there’s very little that Flash can do that HTML5 can’t handle. Still, a number of holdouts remain, especially in the education and gaming space.

  As the company’s VP of product development Govind Balakrishnan also noted, Adobe remains proud of the legacy of Flash — and for all of its flaws, it’s worth remembering that it played a pivotal role in bringing video and gaming to the web, for example. Microsoft once tried to compete with it when it launched Silverlight back in 2007, but at that point Flash was already so ubiquitous that even Microsoft had no chance to displace it (though it’s still kicking around somewhere in the Windows ecosystem).

  
  Done by: Oman Ansari

    Sumit Chakraborty

    Swarnendu Chakraborty

 

 

What measures can start-ups take so that business won’t get affected despite such outbreak(COVID-19) in future

Corona Virus outbreak is the first and foremost a human tragedy, affecting hundreds and thousands of people. Corona Virus Disease 2019 (COVID-19) is an infectious disease caused by severe acute respiratory syndrome corona virus 2(SARS-CoV-2). The disease, first identified in Wuhan, the capital of China’s Huwei province, has since spread globally, resulting in the ongoing 2019-2020 Corona virus pandemic. On 30th January 2020, the World Health Organization (WHO) declared the 2019-2020 corona virus outbreak a Public Health Emergency Concern (PHEIC) and a pandemic on 11 march 2020.
Due to the high rate of transmission and lack of antidotes for COVID-19, human life has already come to a standstill. Naturally, the business world is also facing its own consequences.

THE CONSEQUENCES

In recent weeks, we have seen the huge economic impact of the corona virus on the global economy, financial market and vulnerable sectors such as manufacturing, construction, tourism, hospitality, travel, transport and education. The Indian stock market index, the BSE SENSEX, and National Stock Exchange of India NIFTY 50 has fallen by 25% in the last 30 days.
As the stock market is falling gradually, investors are choosing less risky investments. Gold, traditionally considered a “safe haven” for investment in times of uncertainty, also saw a tumble in price briefly in March, as investors expect a global recession.

In China, many workers have been home bound since late January, disrupting factories that assemble electronics or make automotive parts. As a result, the electronics and automotive industry has been badly damaged.
Oil has slumped to prices not seen since June 2001. Investors fear that the global spread of the virus will further hit the global economy and demand for oil. The oil price had already been affected by a row between Opec, the group of oil producers, and Russia. The pandemic has driven the price down further.
The travel industry has been badly damaged, with airlines cutting flights and tourists cancelling business trips and holidays in the beginning, which escalated to more than 100 countries having travel restrictions due to the corona virus outbreak. Most countries now have a ban on commercial passenger transport. The travel and tourism industry accounts for 10% of the GDP and 50 million jobs are at risk worldwide.

Regional airline Air Deccan on Sunday announced ceasing of operations until further notice, becoming the first Indian airline to succumb to the lock down crisis. The airline sent all employees on sabbatical without pay. A major oil price crash in international markets came as godsend, but the oil producers’ bid to cut output and cushion the price fall may take away much of that advantage by the time the airlines are back in the sky again.
Sadly, criminals and hackers are also exploiting this situation and there has been a significant rise in Corona virus-themed malicious websites, with more than 16,000 new Corona virus-related domains registered since January 2020. Hackers are selling malware and hacking tools through COVID-19 discount codes on the internet.. Stock markets are plunging — down about 25% in last 30 days — oil prices are in free fall, supply chains are being disrupted, and in the middle of it all, small- and medium-sized businesses are dealing with frightened employees, skittish customers and an uncertain future. The situation is so dire, US President Donald Trump plans to meet with Senate leaders Tuesday to discuss a payroll cut, small business aid and help for hourly workers who might become sick.
Ever since the coronavirus started infecting people in China, Eric Plam, president of Skyroam, a San Francisco-based company that creates and sells Wi-Fi-enabled hotspots to businesses, has been busy figuring out how to keep his staff safe and his business operating.

Pic: Effect on Travel based businesses and start-ups

Amicable Solutions:-

NOT TOO LATE TO PLAN

This wouldn’t have been an issue a decade ago, when businesses mostly conducted business closer to home, but now many companies are global.
“We encouraged small businesses to be more global and to export more, and now they’re more vulnerable to things like the corona virus,” says Andrew Sherman, a Washington, D.C.-based partner with Seyfarth, a global law firm.
Despite cases continuing to rise and markets sending people and companies in a panic, it’s not too late for businesses to set up remote work forces, communicate with staff and prepare for a worsening outbreak.
.

COMMUNICATE WITH THE STAFF

One of the most important things start-ups can do is communicate with the employees. Many people are likely concerned about their health and how they can continue working as more things get shut down.
Henry Albrecht, CEO of Limeade, has his own Limeade ONE platform comes with an internal communications feature where people can instant message each other. As soon as the outbreak’s seriousness became clear, Albrecht set up what he calls a “care in crisis” channel that automatically sends push notifications to staff whenever he posts. “There’s an intentional importance attached, because the messages are coming from me,” he says.
It’s in that channel where he provides updates on the virus itself — he’s posted a number of CDC videos on COVID-19 and how to monitor oneself for the disease — along with recommended hand washing and social-distancing procedures, travel updates (most are canceled) and ideas on how to work effectively from home.
Employees can also post their own messages in that channel, which he says is key. “It’s powerful,” he says about the two-way communication. “We want to hear from our people as well. We also have the ability to ask people to take a quiz so they can tell us if they need more information on something.”

INVEST IN WORK FROM HOME TECHNOLOGY

While most people likely have a phone, a computer and an internet connection, some may not have enough bandwidth to do the kind of work they do at the office at home. Some companies may also not be set up with the right collaboration tools, such as internal communications programs or secure Wi-Fi networks to allow for remote work.
Over the last couple of weeks, many companies are looking to find ways to help their staff work remotely.
For Albrecht, Microsoft Teams is coming in handy. It’s a collaboration program that allows people to video chat and work on Word files together from wherever they may be. Programs like Google’s G Suite, which comes with collaborative software like Google Docs, Sheets and Hangouts, come very handy in such situations.

CREATE A DISASTER PREPAREDNESS POLICY

A lot of companies have never planned for a crisis on this scale, but as many are finding out now, they need one.
A good plan will cover a number of things, including most importantly:

• Procedures and tools for remote work – It should spell out how people should work from home and what tools they’ll need to get the job done; how to handle travel; what to do about meetings and more.
• Insurance coverage for business closures or trip cancellations
• Financing – How to finance when no one is investing, what lines of credit are in place, etc.
• Supply chain alternatives
• Companies like restaurants or local movie theaters, will have to think hard about how to manage staff and cash flows if people stop going out.

All of this should be documented, as it shows that people are thinking about what could happen in a worst-case scenario, and it acts as an easy-to-reference guide on what to do, how to communicate and how to keep business running in difficult times. Every company needs all the elements of a crisis-management or disaster-preparedness plan in place.
No matter what happens, small- and medium-sized businesses will no doubt take some sort of hit to their bottom line. While the government may step in to help — the Finance Minister, Dr. Nirmala Sitharaman has already announced several measures to relieve immediate stress of businesses — business owners need to be proactive and do what they need to do to keep their doors open, even if their employees aren’t there.

A Leadership Lesson the Pandemic has Taught to CEO’s

Amul

“My Biggest Concern is Making Sure My Workers are Available for Deliveries” -R.S. Sodhi, Managing Director, Gujarat Co-operative Milk Marketing Federation (Amul)

Amul has sought the support of local governments to ensure that the distribution of milk is not disrupted, since it is an essential commodity.
“I have seen curfews in the past, but I have realised that our teams should also be taught how to handle such scenarios and manage with just 25% of the staff, and which authorities to talk to when our trucks are stopped.”

Apollo Hospitals Enterprise

“This Pandemic Reminds Us that We are All Equal and Connected” -Suneeta Reddy MD, Apollo Hospitals Enterprise
Being able to sit and discuss with colleagues and brainstorm on courses of action and business decisions, and being able to find out best practices from around the world, is a blessing.
It reminds us that we are equal regardless of our religion, culture, occupation or financial situation. It reminds us that we are all connected and the false borders we have put up give us no protection. It reiterates how important our health is and how we should not neglect it and, most importantly, it teaches us that our true work is not just our job, that’s just what we do.

Lemon tree hotels

“Working from Home, I Have More Time to Think” – Patu Keswani, Chairman, Lemon Tree Hotels
There are two aspects. One, I think it has helped us become much leaner and will in the long term ensure we are more cost-effective — any and all potential points of waste have been eliminated and fixed costs reduced. Two, that in times of crisis, new streams of revenue arise — in this case the sudden need of IT companies and MNCs for rooms to house employees who are required for business continuity.
First, if your culture is great, your biggest support in times of utter uncertainty will be employees —it’s a wonderful and very comforting feeling to have. The second is an intuition, actually a conviction, that in future, such black swan events will occur more frequently and that one must always have a business continuity plan in place that factors in perhaps zero revenue for up to 6-12 months in the worst case

Sequoia Capital India

“For Many Startups, the Only Focus Will be to Survive the Year” -Rajan Anandan MD, Sequoia Capital India

I spend some meaningful time every day connecting with friends and family. We talk about non-Covid topics. Regularly checking in on people I care about helps me create some personal space during the day — and I find that helps for leaders, when the world is extremely worried and concerned, it’s important to be thoughtful and empathetic — but it’s equally important to act. If there was ever a time to be decisive, it’s now. Some of the decisions you take may not be correct. But in the current scenario, ‘wait and watch’ is not an option. You have to do what you think is best. And communicate constantly. People want to hear from leaders during tough times — so make sure your voice is heard.

Zoomcar

“It is Important to Religiously Follow Daily Stand-ups and Staff Meetings” – Greg Moran, Co-Founder, Zoomcar
Teams are now getting into the groove of this new working reality. It is important to religiously follow daily stand-ups and staff meetings to ensure everyone is on the same page.
Never waste a crisis. Use it as a teaching moment and as an opportunity for the team to come closer and work at an even greater productivity level.

TATA Power

“I Keep a Positive Frame of Mind in Order to Help My Team” – Praveer Sinha MD, Tata Power
As the leader of a foremost utility service company, I have been through many ups and downs. That is the way of life and business and one learns to take the good times and the storms in one’s stride. As a professional manager and business leader, I have to ensure that I keep a positive frame of mind in order to help my team.
When the going gets tough, the tough gets going. I firmly believe that a leader is only as good as his or her team. My team is my strength and by serving the country in a committed and selfless way, they have proved their mettle and character. Our employees realise that all of them cannot afford the safety of working from home and are taking up the challenge with full commitment dedication.

Panasonic

“The Initial Impact was on the Supply Side; Now It is on the Demand Side” -Manish Sharma President & CEO, Panasonic India & SA
We have suspended production at our factories temporarily. We are monitoring the situation closely. In these defining times, it is crucial to reflect on our core values and further strengthen the consumer trust in the after-sales service. Practicing resilience is the way forward. Individuals and organisations need to be cautiously optimistic and consciously prepare for adverse conditions where things might not be in their control and simultaneously plan to explore the opportunities ahead. True leadership is tested in a crisis, where leaders need to accumulate the collective wisdom of people around, but still have the ability to take critical decisions themselves even if it means risking their own reputation. This is important to steer an organisation through tough times and be in a position to provide service to the society and livelihood to people in times to come.
Lastly, in this present scenario of utter distress and Global Pandemic, The Start-Ups ought to showcase their Corporate Social responsibility so that everyone’s small efforts can heal our Mother Earth from this Pandemic and free us all from the shackles of this distressed situation and as a result make our Mother Earth a better place to live in for the future generations to come.

Written by- Ritoja Sen, Arka Dutta, Animesh Bhakat

Edited By-Sayan Seth.

Direct-to-Consumer(D2C) all set to flare-up at the fall of the new decade

What is D2C?

D2C, or direct-to-consumer, is a retail model that cuts out the middleman to deliver products straight to buyers. Compared to traditional retail, which relies on wholesale distributors and secondary retailers, these companies wield end-to-end control of making, marketing, and shipping their wares.

 

Problems of Traditional Business Model

In many cases, it is seen that an established business with a strong product line is losing market share to the e-commerce platforms and are struggling to develop an e-commerce platform and integrate into the existing business model. To curb this problem, there is an alternative way called D2C which enables to establish relationships between products and customers.

Emergence of D2C

D2C marketing isn’t a brand new concept. Mail-order catalogues, the first-ever of which was published in the 15^th century Venice gave customers a first taste of the potential of D2C. Customers would receive a pamphlet of products they could purchase a particular merchant for mail delivery. At a time when brick-and-mortar sales are flat, with just 0.5% growth in 2017, and e-commerce sales are booming, expected to grow to 17% of all retail sales by 2022, it’s clear that online experiences are setting the new norm in retail.

Emerging D2Cs are digitally native, primed to leverage the powers of e-commerce to challenge legacy brands in every industry.

Breaking the Wall between Products and Customers

From the very beginning, brands have different walls between their products and customers and in many cases, they are not aware of the fact what the consumer is buying or who the consumer is. Several questions may arise in the minds of business brands

Are my ads reaching the right customers?

Am I producing the right amount of product?

Am I wasting resources?

So they can’t get the key information they crave on consumer behaviour. The walls have made marketing essentially a guessing game. The D2C platform will remove all types of ambiguity and will help to establish a direct relationship between customers and products.

Successful implementation in Companies

It helps the products to get acquainted directly with the consumers since the advent of mass media.

Let’s have a look at a few companies which successfully implemented the D2C business model

• Casper created an entirely new mattress buying experience.
• Dollar Shave Club introduced a reliable razor subscription model.
• Warby Parker made glasses cool.
• Some legacy brands have even moved partially or completely into the direct-to-consumer space, like Coach, which broke up with department stores in 2016.
• Brands like Borders got replaced by Amazon Kindle, Blockbuster by Netflix, and also platforms like Spotify and Apple music have come in.
• DTC brands are one of the fastest-growing groups of TV advertisers in the US.
• Tesla recently launched a pre-order for their model 3 and in one week they got a reserve demand for 300,000 cars starting at $35,000 per car that represents the demand of at least 14billion dollars a week and they did not spend a penny on mass media to generate that demand as they knew the name and identity credentials of every single customer who required the car and they were able to raise debt based on the future demand of their cars.
• Xiaomi is a very popular Chinese smartphone brand that released a pre-order for their ‘Mi5s’, ‘Mi5s plus’ and recorded about 3 million registrations in just 24 hours as they were directly able to reach their target customers directly.

Influence on Millennials

For millennials or the highly scrutinized generation between 1981-1996 D2C appears more appealing than B2C as they have no problem in opting for brands that speak to their priorities and have low cost and are also less convenient which is readily available through D2C. Though Gen-Y normally prioritizes affordability above quality and direct to consumer brands stand apart in this case as they can easily offer both. Usually, the wholesalers and retailers mark up the prices after getting them from the manufacturers and the customers have to pay a huge price for buying the products. But in the case of D2C, there is no such scope as the customers can directly receive their products from manufacturers without sacrificing the quality of the product. 

Some of the key features of D2C business model are:

1. Low Barrier to Entry: D2C companies have the advantage of facing fewer amounts of barriers as they can directly address the needs of the customer.
2. Low Price: The companies which manufacture, ship and sell their products actually without undergoing the interminable process of retails which enables the customers to receive products at low cost.
3.  Better connectivity with the customers: D2C business model can allow a company to directly address the issues of the customers and cater to their needs. This is because, by cutting out the drawn-out supply chain and saving time as well, companies can directly monitor the buying trends of the customer thus the company can build suitable strategies based on these trends.
4. Huge Brand Image: D2C business can build a huge brand image and a customer base in a really short period. Since the judgment of the product or the reviews will be directly based on the company’s performance and sales of the product won’t be affected by the strategies of the retailer.
5. Mostly Digital: Digital marketing and e-commerce has been groundbreaking innovations in the commercial fields. Most of the D2C companies are e-commerce companies because the digitalization of sales has facilitated the growth of D2C companies and made such a model possible.

 

Future of D2C

D2C models use generally social ads which are quite more adaptive nowadays. Customers find this easy and cost-effective. Finely tuned social ads will not only spread awareness faster than any out-of-home ad campaign, but they also spread awareness to the right customers. 24/7 on-site chat support and social messaging, like Facebook Messenger, help you offer highly personalized customer service with the immediacy consumers expect of online shopping. The retail landscape has evolved rapidly in the 21st century, with small brick-and-mortar stores closing, legacy brands shuttering, and e-commerce rising in prominence. Big brands need to evolve to keep up with consumer habits and expectations, and digitally native D2Cs offer the best lessons for domination in e-retail. From using data to fuel personalization to amplifying word-of-mouth through online social influence, some strategies and tactics will keep established brands growing with modern retail, instead of against it.

Written by:
Rounak Kirtania, Suvro Mukherjee, Apurba Banerjee

Illustrated by:
Abhinandan Bose

Edited by:
Ankan Chattopadhyay

 

 

Sensex goes for a bawl as Corona disrupts Global Economy

During this pandemic breakdown of COVID-19, it has become a regular scenario as Sensex fell by 1000 points. This is turning out to be a serious concern for the nation. So what went wrong with the market which caused this type of downfall? Is this only due to COVID-19? Are there other key factors too? For the detailed analysis refer below:

1. Breakdown because of Coronavirus:- With a global outbreak of this virus, it has directly hit the​ economy which causes a ​domino effect ​in such ​interdependent sector-wise businesses​. As a result, the investors started losing faith in the growth of the economy as well as the health of the businesses which impacted a sharp negative downfall into their stock-prices. A threatening drastic change in consumer behaviour is observed due to this epidemic disease which disrupts businesses and thus, short-term earning outlook takes a beating. With no solution in sight to the coronavirus crisis, ​investor sentiment​ has taken a hit. They are rushing to prune riskier bets amidst coronavirus pandemic fanning recession fears as well as the uncertainty of its limit of affecting us.
2. Recession-likely Atmosphere:- In the time of global economic slowdown as well as the ​US-CHINA trade war, ​ there was always a question in​ INDIA’s GDP​ growth in the future days. In recent times, the credit rating agencies like ​Moody’s, S&P global​ have decreased not only INDIA’s GDP growth rate but also for other countries. Due to this, many of the investors had a question in their mind as to whether this another starting point of the global recession caused by this pandemic. Commenting about the state of the ​global economy​, the ​International Monetary Fund​ (IMF) said,
   
   “The world is in the face of a devastating impact due to the coronavirus outbreak and has clearly entered a ​recession​.”

3. FII Outflows:- Foreign money managers are withdrawing money continuously from the​ domestic equity and debt markets​. They have withdrawn more than Rs. ​1 lakh crore​ from the equity and debt market till now, as per data available with NSDL. This has directly impacted our Forex reserves and for that reason, the ​dollar price is increasing which is not healthy for the Indian economy. To compensate the loss, RBI has to introduce several currency swaps and to reduce its ​repo rate​ just to maintain the ​liquidity in the domestic market​ and the dollar-rupee price balance, which directly hits our fiscal deficit for the long term aspects of our economy.

   

4. Global Markets:-  In recent days the face-off between Russia and Saudi Arabia hit the​ global market with a ​slip of crude oil prices​ which hurt the USA but had a positive impact on INDIA to save its ​import bill​. But being the world’s no.1 in terms of economy and having such an interdependent world-wide economy, USA considered it as a bad scenario for most investors in the longer horizon. Apart from that, according to most Indian investors, the ​market was overvalued​ and it seems that it should be ​corrected​. And using the corona-virus outbreak, it is now a bearish trend. 

 

COVID-19 IMPACT ON SECTORS

HIGH:- Airlines, Ports, Hotels and Hospitality, Malls, Multiplexes, Tours and Travels, Restaurants and​  Retails, Media and Entertainment.

MODERATE:- Auto, Real-estate, IT, Petrochemical, Renewables, Consumer durables, Banks and NBFC,​       Electronics, MSME, AMC.

LOW:- Pharmacy, Power, Telecom, FMCG.

WHICH ORGANIZATIONS CAN REGAIN ITS VALUE?

The organizations who are ​fundamentally very strong​ with very good core ​management, low debt​ with ​no pledged shares of promoters,​ can be the best option to invest in this period. Ideally, these companies are always the best ones even in the bad times of the market.

WHAT SHOULD BE THE INVESTMENT STRATEGIES AT THIS TIME?

1. At this time one should try to​ invest​ in the market rather than ​trading​.

2. If you are going to invest a lump sum amount, try to avoid this, and invest the amount in ​multiple bits when the market goes to a low side. The people who are in SIP can go ahead for it as usual, because they will get more in this time.

3. Try to invest in every dip with fundamentally strong companies who have low debt and proper cash reserves.

4. Don’t go for the ​penny​ stocks.

5. If you have already invested in the higher levels of the market, then it is the right time to average out your positions.

 

N.B.:- The above article is only for educational purposes. Before investing, try to do your own analysis with the companies and sectors. KGEC E-CELL and the content writer will not be responsible for any kind of mishap.

Written by:
Tirtharaj Chakroborty

Edited by:
Sarthak Mazumder