Friday, 2 December 2016

Reincarnation of Smart Phone ( with SARAL app )

To accelerate the movement towards a DIGITAL PAYMENT ECONOMY ( or a LESS CASH economy ) , the committee of Chief Ministers set up for this purpose , is convinced that we need to increase the number of smart phones in use , from current 200 million to , may be 700 million

All pre-installed with AEPS ( Aadhar Enabled Payment Service ) mobile app , which the NDA government plans to launch in next 15 days

AEPS will be linked with Biometric identification / Aadhar number / Jan Dhan bank a/c number of the user 

( as suggested in my blog :  How to go Cashless : 27 Nov 2016 )

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It was reported that the Committee debated various methods of putting these additional 500 million smart phones in the hands of the users , including the option of NDA government " buying " these directly from manufacturers and then selling to public at subsidized rates

Even at a modest price of Rs 1000 per phone , that would cost Rs 500 Billion - which the government does not have

And the disaster of Aakash Tablets is still haunting us !


I am talking of solutions that do NOT require the government to foot the bill of buying 500 million phones


Using Smart phone as a Service ( instead of " Smart phone as a Product " )

With the arrival of UBER / OLA , cars are changing from " products owned by individuals ",
to " transport service enjoyed by hundreds without owning "

All over the World , car manufacturers are worried at this disruption , where less and less people would want to " own " a car and would rather call for a taxi through a mobile app

It is proving to be much cheaper ( than owning / maintaining ) and more convenient !

So the car manufacturers are asking of themselves :

*  Shall we become a transport service provider , rather than a car manufacturer ?

*  Rather than " sell " a car for a one-time income of Rs 10 lakh , should we sell taxi-service
   worth , a recurring income of Rs 1 lakh per month for 24 months ?

As a first step , we have recently witnessed leading car manufacturers all over the World , tying up with mobile app based taxi services

And do not be surprised if , in the next 2 years , you see taxi service providers getting cars manufactured in their OWN BRAND NAME ! And Mahindra & Mahindra , willing to do that !

There is no reason why this new BUSINESS MODEL , cannot work for smart phones

We have following options :

*  Smart phone manufacturers becoming " Mobile Service Providers - MSP " themselves

*  Mobile Service Providers getting phones made by manufacturers and " bundling " with
    their services ( - although , I believe , this is not currently permitted in India )

*  Mobile Wallet Service providers ( Paytm / Mobiquick / FreeCharge etc ) , providing the
   phones to their subscribers , free of cost or at a highly subsidized rates

*  NDA government entering into a " Revenue Share Agreement " with any of these ( Phone
   Manufacturers / MSPs / Mobile Wallet companies / Banks etc ) , who are willing to ,

   #  Get SARAL phones made , duly pre-installed with AEPS and give away to users FREE

   #  Earn from the Government , 1 % of the " Payment Transaction Amount " as their
       revenue share , whenever the user buys any goods / service , using SARAL ( for the
       Government , this will work as a kind of " subsidizing through deferred payment " )

But let us go back to the earlier example of cars ( Individual Ownership vs  Collective Usership , ala Uber / OLA )

Why do people need to " OWN " a phone ( AEPS pre-installed ), in order to be able to " USE " it ?

People who make their purchase payments using Credit / Debit cards , do NOT own their personal PoS machines / Card Readers !

The SELLER owns those machines , kept on his counter

And allows the BUYERS to use these while making payment

With AEPS duly " integrated " with Aadhar-based BIO-METRIC device , linked to user's bank account , there is no technical reason , why a BUYER cannot use an AEPS installed phone , lying on the counter of the SELLER !

When he is carrying his EYES - and his Aadhar Card - there is no need for him to " OWN / CARRY " his own EYE - READER ( smart phone ) , wherever he goes !

Just look into the camera of the SARAL phone lying on the sales counter , speak your Aadhar Number , then speak payment instruction !  As SARAL ( simple ) as that, until smart phones start reading your unspoken thoughts !

And putting a 100 million SARAL phones ( pre-installed with AEPS ) , into the hands of SELLERS , is much easier / faster / cheaper than placing 500 million phones into the hands of USERS !

With this innovation ( shrinking and morphing a bulky PoS / Card Reading Device to a tiny SARAL phone , pre-installed with AEPS ) , there is an opportunity for manufacturers of these devices to " re-invent " themselves !

Now is the time to make themselves obsolete , before someone else does !

If they don't , they are cooked !

And , since Credit / Debit card Issuers too are on the verge of " going into oblivion " , they would be happy to tie-up with PoS / Card Reader manufacturers , to implement my suggestion

They can still survive , if they ensure that those MORPHED / SHRUNK devices ( called SARAL phones ) , enable millions of illiterate Indians to make their payments , just by " talking to the phone ( lying on the SELLER's counter ) " , in a language of their choice !

If they succeed in pulling off this innovation ( of spoken instructions ) , they have a good chance to beat existing Mobile Wallet companies

Dear Shri Amitabh Kant :

If asked , Sundar Pichai ( Google ) would gladly combine " Google Talk "  with " Google Translate " , to come up with a  " SARAL " app which can be integrated into AEPS !

This  SARAL  avatar of a Smart phone , has tremendous scope for export all over the World .

I hope , the Members of the Chief Ministers Committee , find time to debate my suggestions


03  Dec  2016 / blogs

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