Kill or Be Killed

The mayhem in the global telecom market continues. A recent article in the Economist opined that the dotcom crash was just a warm-up for the real crash that is happening now. It also estimates that the total debts of the telecom companies total up to a trillion dollars. The telecom companies borrowed billions to build huge fibre optic backbones. Demand projections turned out to be off the mark and they were left with a crippling mix of excess capacity and huge debt. Some like WorldCom resorted to fudging their books. Others quietly folded up.

Analysts attribute the crash partly to the fact that no killer broadband app has emerged till date. Consumers will not take up all the bandwidth available till they see a compelling set of apps. The apps currently on the market are simply not interesting enough. The fate of a large number of companies globally depends on being able to put all this bandwidth to creative use. In India the situation is somewhat better–the plain vanilla voice market can take up some of the capacity being created by Tata, Reliance, Bharti etc.

What the killer app will be, I have no idea, but can definitely suggest a few guidelines for one: 

l It must be very simple to use 



l The success of any content based app depends on the quality of content 


l Speed alone is not the key to success in most cases–don’t hurry.

Let’s start with the first one–simplicity in use. Users just don’t have the time to learn how to use a new app. For that matter most do not even spend enough time learning how to use their cell phone. The only successful mobile app other than voice that has succeeded is SMS, which is a simple application. Adding multiple options and fiddly menus to SMS will have little effect–the vast majority of users simply ignore these options.

The next rule sounds stupid–high quality content for content-based apps. But it is surprising how many service providers pay no attention to content quality. Information providers are made or marred by the quality of their editorial department, not by the technology used. Imagine a newspaper thinking that it will succeed solely because it has the best printing press. In the short run the look of the paper might attract subscribers, but in the long run it will only succeed on the merits of its content. Many geeks think that what matters is getting the infrastructure and technology in place and that content development is an easy function. This thinking is wrong–it is technology, which is becoming a commodity and not content.

The dotcom boom was mostly driven by the premise of the early mover advantage. Being first is advantageous, but one must be able to sustain the effort. What typically happens is that early movers wrest the initial advantage and then discover that they have not put the structures in place to service the advantage. This point also applies to pure software applications–Lotus, Borland and WordPerfect all were dominant in the early days. All three have been taken over today and have only niche market shares.

Finally I am sick of people telling me that I will use my cell phone to find the nearest Chinese restaurant. I don’t think that I would need this service in Delhi, I know my way around pretty well. I travel a lot but mostly to small towns where the service will not be available. And when I travel to metros or abroad I do not foresee a compelling reason to subscribe–the visit is of

short duration and I virtually never have enough time to carry out this sort of an exercise.

The bottom line: Broadband providers need a killer app to survive. But I am skeptical about such an app arriving soon.

Gautama Ahuja runs a turnkey software company, AHC Infotek