Hi Friends,

Even as I launch this today ( my 80th Birthday ), I realize that there is yet so much to say and do.

There is just no time to look back, no time to wonder,"Will anyone read these pages?"

With regards,
Hemen Parekh
27 June 2013

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 )

{  http://myblogepage.blogspot.in/2016/11/how-to-go-cash-less.html  }

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

www.hemenparekh.in / blogs