Archive for ‘Technology’

09/03/2017

Schumpeter: Mukesh Ambani has made the business world’s most aggressive bet | The Economist

SOME businesspeople are guided by experts, spreadsheets and crunchy questions. What is your three-year target for market share? Will a project deliver a reasonable return on the capital invested? A few hurl all the forecasts and reports into the bin and surrender to their own hunger to make a mark.

One such figure is Mukesh Ambani, India’s richest man. In September 2016 he placed one of the biggest business bets in the world by launching Jio, a mobile-telecoms network that allows India’s masses to access data on an unprecedented scale. In the past six months it has won 100m customers. Only one other firm on the planet has such an acquisition rate—Facebook. From Kolkata’s slums to the banks of the Ganges, millions of Indians are using social media and streaming videos for the very first time.

To achieve this, Mr Ambani has spent an incredible $25bn on Jio, without making a rupee of profit, terrifying competitors and many investors. The motivation for his gamble probably lies with his turbulent family history. Reliance Industries Limited (RIL), Mr Ambani’s company, was set up by his father, Dhirubhai, in 1957. Born in humble circumstances, Dhirubhai was famous for three things: running rings around officials; creating a fortune for himself and RIL’s army of small shareholders; and his appetite for giant industrial projects. RIL jumped from textiles into oil refining and petrochemicals. Its refinery in Gujarat is one of the world’s largest. It opened in 2000, two years before Dhirubhai died.

Mukesh Ambani and his brother, Anil, took the reins in 2002 and split from each other in 2005, leaving Mukesh in full control of RIL. Since then his record has been patchy. RIL’s shares have lagged India’s stockmarket over the past decade and its return on capital has sagged, halving from 12% to 6%.

Emulating his father, Mr Ambani has rolled the dice on several huge projects. He has invested huge sums to modernise the petrochemicals and refining business. This decision has been a success—it is an excellent operation that makes a return of about 12%. But Mr Ambani’s other investment calls have flopped. In 2010-15 RIL spent $8bn on shale fields in America. Now that oil prices are lower they lose money. The group invested about $10bn in energy fields off India’s east coast; they have produced less gas than hoped for and are worth little. And RIL has spent around $2bn on a retail business that produces only small profits. All told, RIL’s refining and petrochemicals unit accounts for two-fifths of its capital employed but over 100% of operating profits. The other businesses, developed mainly after Mr Ambani took sole charge, swallow a majority of resources but don’t make money.

A lesser man might have lost his nerve, but Mr Ambani has pursued another colossal bet in the form of Jio. He knows telecoms: in 2002 he oversaw the family’s first attempt to build a big mobile-phone business (his brother now owns the struggling operation). The latest effort has been a decade in the making. Step by step, RIL acquired spectrum, worked with handset suppliers and built a “fourth-generation” network. Jio’s offer of free services caused a sensation. A savage price war has ensued. One rival executive reckons Jio is carrying more data than either China Mobile or AT&T, the world’s two most valuable operators.

That underlines the potential of India’s telecoms market. Data usage is low, there are few fixed lines and most people don’t have smartphones. The incumbent firms are heavily indebted, so have limited ability to respond to a price war.

Jio will start charging from April 1st. Yet even assuming it keeps cranking prices up and wins a third of the market, a discounted-cash-flow analysis suggests that it would be worth only two-thirds of the sum that Mr Ambani has spent. To justify that amount Jio would at some point need to earn the same amount of profit that India’s entire telecoms industry made in 2016. In other words, there is no escaping the punishing economics of pouring cash into networks and spectrum. For every customer that Jio might eventually win, it will have invested perhaps $100. Compare that with Facebook or Alibaba, both asset-light internet firms, which have invested about $10 per user.

Jio’s three main mobile competitors have scrambled to respond. Bharti Airtel is buying a smaller rival to try to lower its costs. Vodafone is in talks about merging with Idea Cellular, another operator. Half a dozen or so weaker companies (including the firm now run by Mr Ambani’s brother) will probably disappear. The best hope for Jio is that in the distant future it will be one of three firms left and that a cut-throat industry will evolve into a comfy oligopoly, which is possible.

RIL’s share price has gone nowhere for years but excitement about Jio’s 100m new customers has helped it bounce over the past month. Still, the scale of the investment illustrates the risks that shareholders face at a firm that is controlled by one man. Even if Jio eventually gushes cash it is not clear if RIL will pay bigger dividends, or if Mr Ambani will instead pursue another grand project. As investors wait, however, many more of India’s 1.3bn consumers will gain—not only from low prices, but a welcome splurge on the nation’s telecom infrastructure.

Defiance from Reliance
And what of Mr Ambani? Perhaps he hopes to get his money back by turning Jio into an internet firm that offers payment services and content, not just connectivity. China’s Tencent, which owns WeChat, a messaging service, has successfully diversified into games and banking. Still, no telecoms firm has managed this feat and it is hard to see how RIL’s clannish culture can become a hotbed of innovation. More likely, Mr Ambani, aged 59, just doesn’t care what all the spreadsheets point to. Sitting atop his skyscraper, overlooking teeming Mumbai, where some 5m new Jio customers are surfing the web at high speed for peanuts, he can at last say that he has changed India. When you are Dhirubhai’s son, that is probably enough.

Source: Schumpeter: Mukesh Ambani has made the business world’s most aggressive bet | The Economist

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15/02/2017

India Breaks Record for Launching Most Satellites From Single Rocket – India Real Time – WSJ

India’s space agency on Wednesday launched a record 104 satellites from a single rocket as it crossed another milestone in its low-cost space-exploration program.

The satellites from seven countries were carried by the Indian Space Research Organization’s Polar Satellite Launch Vehicle on its 38th consecutive successful flight.

The mission reinforces India’s emerging reputation as a reliable and cost-effective option for launching satellites. In 2014, ISRO put a satellite into the orbit of Mars, becoming the first Asian country to reach the red planet at fraction of the cost of a similar launch in U.S. and Europe.

ISRO has now put 226 satellites into orbit, including 180 from foreign nations. The global space industry was estimated to be worth $323 billion in 2015, the latest year for which data are available, according to the Space Foundation, a U.S.-based research group. Commercial space business comprised as much as 76% of the industry.

Rajeswari Pillai Rajagopalan, senior fellow in space-security studies at the Observer Research Foundation, a New Delhi think tank, said the launch was a “showcase of India’s growing capabilities.”

 

Spectators watched the launch of ISRO’s Polar Satellite Launch Vehicle (PSLV-C37) at Sriharikota on Feb. 15, 2017.

“India’s space program has come a long way,” she said.

Ms. Rajagopalan said the trend for sending more small satellites–instead of fewer large ones–will benefit ISRO due to the cost advantages it offers over its American and European competitors. The Space Foundation said nano satellites comprised 48% of launches in 2015

Wednesday’s feat eclipses the record set by Russia in 2014 when it launched 37 satellites in a single mission. A National Aeronautics and Space Administration rocket carried 29 satellites in 2013.

The PSLV rocket blasted off from the Satish Dhawan Space Center at Sriharikota in the southeastern state of Andhra Pradesh at 9.28 a.m. Wednesday local time (10.58 p.m. Tuesday ET).

The ISRO rocket hurtles through the sky after launch from Sriharikota, India, Feb. 15, 2017.

It first released its main cargo, ISRO’s 714 kilogram Cartosat-2 series satellite, which will be used for earth observation. It then released two smaller ISRO satellites, followed by the remaining 101 nano satellites, one each from Israel, Kazakhstan, Netherlands, Switzerland, United Arab Emirates, and 96 from the U.S. As many as 88 of the nano satellites belonged to U.S.-based company Planet Inc.

ISRO’s two smaller satellites are carrying equipment for conducting various experiments.

Indian Prime Minister Narendra Modi tweeted his congratulations. “This remarkable feat by @isro is yet another proud moment for our space scientific community and the nation. India salutes our scientists,” the message said.

Mission Director B. Jayakumar said it was a challenge to “find real estate (on the PSLV rocket) to accommodate all the satellites.” He said a “unique separation sequence” was designed due to the large number of satellites.

ISRO chairman Kiran Kumar Rao, right, held up models of the CARTOSAT-2 and Polar Satellite Launch Vehicle (PSLV-C37) after the launch in Sriharikota, India, Feb. 15, 2017.

ISRO said the satellites went into orbit 506 kilometers from earth, inclined at an angle of 97.46 degrees to the equator–very close to the intended orbit–after a flight of nearly 17 minutes. In the subsequent 12 minutes, all 104 satellites were successfully separated from the rocket in sequence, it said.

After separation, the two solar panels of ISRO’s Cartosat-2 series satellite were deployed and the space agency’s command center in Bangalore took control. In the coming days, the satellite will begin to provide start sending back black and white, and color pictures, ISRO said.

Source: India Breaks Record for Launching Most Satellites From Single Rocket – India Real Time – WSJ

03/02/2017

Apple Is Set to Make in India, State Official Says – India Real Time – WSJ

In a potential boost to Prime Minister Narendra Modi’s “Make in India” initiative, tech giant Apple Inc. is nearing a deal with Taiwanese contract manufacturer Wistron Corp. to start making products in the southern state of Karnataka, a senior state official said.

“The contractual agreement between the two companies is on the verge of being signed,” the Karnataka government official who has direct knowledge of the matter said.

The first phase of assembling iPhones will likely start as early as the end of March, and further expansion is expected over the next two to six months, the official said.An Apple spokeswoman said the company has nothing to share beyond a statement it made last week, which said: “We appreciate the constructive and open dialogue we’ve had with [the] government about further expanding our local operations.”

A Wistron spokeswoman declined to comment. The company has a factory in the southern Indian city of Bangalore where it makes smartphone components, and has sought permission from the state authorities to expand the facility with additional power supply and fire-fighting facilities, the official said.

“What we are given to understand is that Apple is awaiting a final word from the government of India regarding tax and tariff concessions sought by the company, before signing up the contractual agreement,” the official said.

Making goods such as the iPhone locally may help the Cupertino, Calif., company to open its own stores in India, in turn building its brand in a country where it has less than a 5% share of a booming smartphone market.

Karnataka’s Information and Technology minister, Priyank Kharge, welcomed Apple’s proposal to consider Bangalore, also known as Bengaluru, as the location for potential manufacturing.

“Apple’s intentions to manufacture in Bengaluru will foster cutting edge technology ecosystem and supply chain development in the state, which are critical for India to compete globally,” Mr. Kharge said in a statement Thursday.Apple is looking to ramp up revenues in India as sales stagnate in China, long an engine of growth. India should soon overtake the U.S. as the world’s second-largest smartphone market after China. Smartphone shipments in India grew 18% last year, compared with just 3% globally, according to Counterpoint Research.

Apple Chief Executive Tim Cook in a call with analysts this week confirmed the company is “in discussions” to open retail stores in the country, and said Apple intends to “invest significantly in the country and believe it’s a great place to be.” (http://blogs.wsj.com/indiarealtime/2017/02/01/what-tim-cook-said-about-apples-big-plans-for-india/)

Last week, a team of executives led by Priya Balasubramaniam, an Apple vice president, met with senior Indian government officials in New Delhi as well as state officials in Karnataka to discuss the firm’s proposals. (https://www.wsj.com/articles/apple-nears-deal-to-manufacture-products-in-india-1485340934)

Under Mr. Modi, India has been eager to attract foreign investment and create the manufacturing facilities and jobs the country needs to sustain long-term growth.

Source: Apple Is Set to Make in India, State Official Says – India Real Time – WSJ

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10/01/2017

Donald Trump has ‘great meeting’ with Alibaba boss Jack Ma – BBC News

US President-elect Donald Trump has held what he said was a “great meeting” in New York with Jack Ma, chairman of the e-commerce site Alibaba.

After the meeting Mr Ma said that both had agreed that US-China relations “should be strengthened, should be more friendly and do better”.

Mr Ma said he would help US businesses create a million new jobs by using his website to sell to China.

During his campaign Mr Trump threatened to place tariffs on Chinese imports.

“Jack and I are going to do some great things,” Mr Trump told reporters gathering in the Trump Tower lobby as the two emerged from the lift together.

What exactly does Alibaba do?

The man behind Alibaba: Jack MaUS vs China – Trump tools upTrump hints ‘One China’ policy could end

Calling the future US president “smart” and “open-minded”, Mr Ma described his company’s plan to attract one million small US businesses to its platform in order to sell goods to Chinese consumers.

The Alibaba Group tweeted about their job-creation plan after the meeting

Company spokesman Bob Christie said that one million new jobs will be created over the next five years as small American businesses hire new employees who will be tasked with interacting with Alibaba.

Mr Ma, who is one of the richest people in China, specifically said that farmers and small clothing makers in the US Midwest should use the Alibaba online marketplace to reach Chinese consumers.

It is estimated that up to 80% of Chinese online purchases are made on the Alibaba platform.

The New York real estate mogul has said that 45% import taxes could be placed on Chinese goods and would come in response to currency manipulation and illegal subsidies by the world’s second largest economy.

He has been highly critical of Chinese trade practices, and has appointed noted China critics to key economic cabinet positions in the White House.

Market researchers fear that punitive tariffs would lead to a retaliatory response from China, triggering a trade war.

Source: Donald Trump has ‘great meeting’ with Alibaba boss Jack Ma – BBC News

21/12/2016

What China claims to have invented | The Economist

Strange the Chinese felt the need to do their own reasearch about its inventiveness when that had already been done thoroughly by Joseph Needham – http://www.nri.cam.ac.uk/joseph.html – and summarised in

  The Genius of China: 3,000 Years of Science, Discovery, and Invention
Robert Temple
Inner Traditions
Paperback
288 pages
November 2007

http://www.curledup.com/geniusch.htm

Needham’s research uncovered many more than 88 Chinese inventions!

EIGHT is a lucky number in China. How fortunate it was, then, that a team of more than 100 scientists was able, after three years of research, to declare that ancient Chinese had achieved no fewer than 88 scientific breakthroughs and engineering feats of global significance. Their catalogue of more than 200 pages, released in June, was hailed as a major publishing achievement.

All Chinese schoolchildren can name their country’s “four great inventions”: paper, printing, the compass and gunpowder. Now it appears they have a lot more homework to do. The study purports to prove that China was first with many other marvels, including the decimal system, rockets, pinhole imaging, rice and wheat cultivation, the crossbow and the stirrup.

It is no coincidence that the project, led by the prestigious Chinese Academy of Sciences, got under way a few months after Xi Jinping took over as China’s leader in 2012. Mr Xi has been trying to focus public attention on the glories of China’s past as a way to instil patriotism and provide a suitable historical backdrop for his campaign to fulfil “the Chinese dream of the great rejuvenation of the Chinese nation”.

Mr Xi is building on a long tradition among the Communist Party’s propagandists of claiming world firsts. “China invented Lassie,” ran a headline in Global Times, a party-controlled newspaper, about dogs being domesticated in China 16,000 years ago (another group of scientists reckon China first did this 33,000 years ago). In 2006 official media shocked the Scots with an assertion that China invented golf a millennium ago, hundreds of years before the game took off in Scotland.

As a lover of football, Mr Xi likes drawing attention to China’s pioneering of that sport, too. On a visit to Britain in 2015 he stopped at one of the country’s most famous football clubs, Manchester City. There he was presented with a copy of the first rules for the modern game (drawn up by an Englishman in 1863). In return, he handed over a copper representation of a figure playing cuju, a sport similar to football invented by China 2,000 years ago (see picture, from a football museum in Shandong province). It was apparently popular both among urban youths and as a form of military fitness training. Mr Xi would like a great rejuvenation of this, too. In 2014 he announced plans to put football on the national curriculum. The aim is to make China a “first-class power” in football by 2050 (it has a long way to go).

The growing attention that China pays to its ancient achievements, real and exaggerated, contrasts with the almost total rejection of them by Mao Zedong after he seized power in 1949. In Mao’s China history was not something to celebrate. A central aim of his Cultural Revolution was to attack the “four olds”: customs, culture, habits and ideas. Many Chinese dynasties destroyed some glories of the previous one, but the Communists took this to new extremes. Across the country state-sponsored vandals destroyed temples, mansions, city walls, scenic sites, paintings, calligraphy and other artefacts.That began to change after Mao died in 1976. Now Mr Xi claims that Chinese civilisation “has developed in an unbroken line from ancient to modern times”. He glosses over not just the chaos and destruction of the Mao era but the long centuries when the geographical area now called China was divided into many parts, and even run by foreign powers (Manchu and Mongol).

The party also wants to use ancient prowess to boost China’s image abroad and to counter widespread (and often unfair) impressions in the West that the country is better at copying others’ ideas than coming up with its own. The four great inventions were one of the main themes at the opening ceremony of the Olympic Games in Beijing in 2008, an event that China saw as its global coming-out party after decades of being treated with suspicion and contempt by foreign powers.

Envy of the West’s rapid gains in technology since the 19th century has been a catalyst of Chinese nationalism for over 100 years. It fuels a cultural competitiveness in China that turns ancient history into a battleground. This was evident in China’s prickly response to a recent documentary made by the BBC and National Geographic, which suggested that China’s famous terracotta warriors in Xi’an showed Greek influence. Some people interpreted this as a slight. One Chinese archaeologist dismissed the theory as “dishonest” and having “no basis”; another said that foreign hands could not have sculpted the figures because “no Greek names” were inscribed on their backs. Likewise in 2008 Boris Johnson, then mayor of London, was derided for saying that table tennis originated not in China but on Victorian dining tables and was known as whiff-whaff.

Just a slight inconsistency

The publication of the 88 achievements, however, has drawn attention again to an enduring mystery: why, after a long record of remarkable attainment in technology, did Chinese innovations largely cease for the 500 years or so leading up to the collapse of the last imperial dynasty in 1911? As state media observed, few of the inventions on the new list belong to this period. This puzzle is often referred to as the “Needham question”, after a British scientist and Sinologist, Joseph Needham. (It was he, in his study of China’s ancient science in the 1950s, who first identified the four great inventions—before then most people thought they had emerged in the West.) A member of the team that produced the list said the question deserved “deep reflection” and would be a topic of future research.

Mr Xi skates over this. He lauds Zheng He, a eunuch who launched maritime voyages from China across the Indian Ocean from 1405, as one of China’s great innovators—an early proponent of a vision of China that Mr Xi would like to recreate: prosperous, outward-looking and technologically advanced (the admiral’s massive boat is number 88 on the list). Yet he fails to point out that soon after Zheng He’s explorations China turned inward, beginning its half-millennium of stagnation.

In this 15th-century turning point, reformists in China see an obvious answer to Needham’s question: isolation from the rest of the world is bad for innovation. They take heart in China’s efforts since the 1970s to re-engage with the West, but lament the barriers that remain. With luck, it will not take 100 state-sponsored Chinese scientists another three years to reach the same conclusion.

Source: What China claims to have invented | The Economist

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02/12/2016

Indian Startup Plans to Land on the Moon in January 2018 – India Real Time – WSJ

An Indian aerospace startup has said that it will launch its mission to the moon in a year’s time, as it takes part in a Google-funded competition to become the world’s first-ever privately held company to make a soft landing there.

Team Indus‘s rover, nicknamed ‘Ek Choti Si Asha,’ or ‘one small hope’ in Hindi, won the Axiom Research team a million-dollar prize from Google last year.

A group of more than 100 scientists and engineers, including around a dozen former ISRO scientists, make up Axiom Research Labs’ Team Indus. The team is India’s only entry in the Google-funded Lunar XPrize challenge, which has a bounty of $30 million.

To win the prize, a team has to successfully place a spacecraft on the moon’s surface, travel at least 500 meters and transmit high-definition video and images back to Earth.

“A full launch vehicle from ISRO [Indian Space Research Organization] will launch our spacecraft into the orbit of the moon end of 2017,” Rahul Narayan, the fleet commander of the team, said at a news conference in New Delhi on Thursday.

The supermoon rising above Cape Town on November 14, 2016, when it was closest to the earth in 68 years.

The Team Indus spacecraft is expected to make it to the moon’s Mare Imbrium region by January 2018.

The race is on. Sixteen other teams from across the world want to make the 238,900-mile trip, and Team Indus is the fourth team to announce its launch plans, said Mr. Narayan.

“We are considering the team from Israel great competition at this point,” he said.

The Indian team’s plan is the country’s first shot at becoming the fourth nation to land gently on the lunar surface and unfurl its national flag, after the U.S., Russia and China.

The South Asian nation’s inexpensive Mars mission put its satellite Mangalyan, which now appears on India’s new 2,000-rupee bank notes, into the red planet’s orbit for $74 million in September 2014. The U.S. spent $671 million getting its Maven satellite to Mars orbit.

The team said its mission would cost $60 million.

Team Indus’s core leadership team, including fleet commander Rahul Narayan, fourth from left.

“We’ve already raised about $15 million through private equity,” said Julius Amrit, co-founder and director. The company aims to raise $20 million by charging companies or universities to put their instruments on board to collect data. It also expects to raise another $20 million from sponsorship, donations and grants.

Its top investors include Ratan Tata, chairman of the Tata group, one of India’s biggest conglomerates; Nandan Nilekani, co-founder of Indian outsourcing firm Infosys; and the owners of e-commerce website Flipkart Internet Pvt. Ltd.

“We are quite confident at this moment that we will have enough money to send our spacecraft to the moon,” Mr. Amrit said.

The Bangalore-based startup won a million dollar prize from Google last year for its WALL-E lookalike moon rover, which will shoot high-quality images, video and data and beam them from the moon’s surface to the company’s mission center in India.

 

But the mission isn’t without its challenges.“If you have to softly land, you need to be able to [precisely] manage your velocity and time [to switch your engines on and off],” said Dhruv Batra, Program Lead at Team Indus. “Unfortunately, there is no throttle-like mechanism in a spacecraft, like you have in a car.”

Another challenge is to be able to land at the right time of the day—to make sure the solar panels are able to power the gadgetry, while making sure the temperature isn’t too extreme for the batteries and other electronics to work properly.

“We are currently refining each and every output of our simulations to arrive at that level of precision we need,” said Mr. Batra.Seven years ago, Team Indus was one of the last teams to sign up for the Google challenge, and its founders had no prior experience in aerospace engineering or space sciences, said Mr. Narayan, the fleet commander. “It was just a dream.”

Source: Indian Startup Plans to Land on the Moon in January 2018 – India Real Time – WSJ

29/11/2016

Digital payment firms cash in on India’s money mess, but can it last? | Reuters

Digital payment providers in India have mobilised hundreds of extra workers to enrol small merchants and offered their services for free, betting that severe cash shortages will prove to be the opportunity of a lifetime.

Signing people up, however, may be the easy part.

Getting shops and customers to change their reliance on cash permanently will involve convincing people like Mohammad Javed, a 36-year-old meat shop owner in New Delhi.

Working out of a bustling market in the capital, he is surrounded by banks and ATM machines, but says he does not know how to use a credit card machine, let alone a mobile wallet.

He says business has dropped since Prime Minister Narendra Modi‘s shock move on Nov. 8 to ditch higher value banknotes, but Javed does not believe mobile app providers offer a solution to his problem – or to his customers.

“We don’t have knowledge or resources to open a mobile wallet or card-swipe machine, and our customers who pay 100-200 rupees ($1.46-$2.92) are not interested either,” he said.

Javed’s reluctance is a reality check for the likes of Paytm and smaller rival MobiKwik, which have gone into promotional overdrive since Modi’s announcement.

The prime minister, whose government supports digital payments, brought in demonetisation to crack down on the shadow economy and improve tax collection.

“Why should India not make a beginning in creating a ‘less-cash society?’,” he said on Sunday, “Once we embark on our journey to create a ‘less-cash society’, the goal of ‘cashless society’ will not remain very far.”P

ROMISING SIGNS

The companies say results have been promising so far.

Paytm, backed by Chinese Internet giant Alibaba Group Holding Ltd (BABA.N), has added 700 sales representatives since Nov. 8, taking its number of agents to 5,000.

Advertisement boards of Paytm, a digital wallet company, are seen placed at stalls of roadside vegetable vendors as they wait for customers in Mumbai, India, November 19, 2016.

The company, which has 4,500 full-time employees, plans to double the number of agents to more than 10,000, as it aggressively expands its network.

It says it has nearly doubled the number of small merchants signed up to its services to 1.5 million in the last few weeks and added eight million clients to the 150 million it had before the banknote ban.

MobiKwik, whose backers include U.S. venture capital firm Sequoia Capital and American Express (AXP.N), said it had increased its agent base to more than 10,000 from about 1,000 before the Modi move.

Merchants on its platform have risen to 250,000 from 150,000 previously, and chief executive Bipin Preet Singh said they were aiming for a million in up to two months. It has added 5 million accounts since Nov. 8, bringing the total to 40 million.

But challenges loom.

Credit Suisse estimates more than 90 percent of consumer purchases are made in cash, as millions still do not have bank accounts. Those who do have bank cards mainly use them to withdraw from cash machines.

Sales of cheap smartphones have boomed in recent years, but internet networks remain patchy, especially in rural India. Financial literacy and technology usage also remain low.

Dillip Kumar Agrahari, a vegetable seller in a Mumbai suburb, recently signed up to Paytm but does not know how to operate a smartphone.

He hopes switching to digital payments will improve his business as the cash crunch drags on, but says he will have to depend on a cousin to help with accounts.

Many businesses have traditionally opted for cash transactions because they are hard for the tax man to trace, given sales taxes are typically at least 10 percent.

Mangal Singh, a furniture store owner, said nearly 80 percent of his business was transacted in cash, even though he accepts credit card payments.

“We are working on wafer-thin margins,” he said. “If we are asked to pay 12.5 percent tax and other charges, we will have to close down our shops.”

Concerns also remain about the infrastructure for mobile payments, as customers or merchants from one platform cannot transfer payments to another.

MobiKwik said it had started offering wallet-to-wallet transfers, though not all rivals were on board.

WHEN WILL PROFITS COME?

The challenges raise questions about whether the business models of mobile payments providers are sustainable.

Paytm recently slashed fees until Dec. 31, from a system of fees that ranged from 1 to 4 percent, with the most lucrative coming from telephone and utility bill payments.

MobiKwik is not charging fees until March 2017.The closely-held companies are loss-making.

Paytm Chief Executive Vijay Shekhar Sharma said the company expected to reach profitability in two years, without giving details. MobiKwik’s co-founder Upasana Taku said they hoped to become profitable in mid-2018.

Fitch Ratings believes that once the cash crunch subsides, some merchants and customers will go back to business as usual, using notes to pay for transactions.

“I would expect some amount of behavioural changes,” said Fitch analyst Saswata Guha. “We’re still not sure if this shock per se is incentive enough for them to completely change the way they do things.”

($1 = 68.1384 Indian rupees)

Source: Digital payment firms cash in on India’s money mess, but can it last? | Reuters

25/11/2016

China breaks patent application record – BBC News

China-based innovators applied for a record-setting number of invention patents last year.

The country accounted for more than a million submissions, according to an annual report by the World Intellectual Property Organization (Wipo). It said the figure was “extraordinary”.

Many of the filings were for new ideas in telecoms, computing, semiconductors and medical tech.

Beijing had urged companies to boost the number of such applications.

But some experts have questioned whether it signifies that the country is truly more inventive than others, since most of China’s filings were done locally.

What is a patent?

A patent is the monopoly property right granted by a government to the owner of an invention.

This allows the creator and subsequent owners to prevent others from making, using, offering for sale or importing their invention into the country for a limited time.

In return they must agree for the patent filing to be publicly disclosed.

To qualify as an “invention” patent, the filing must contain a new, useful idea that includes a step – a new process, improvement or concept – which would not be obvious to a skilled person in that field.

Some countries – including China – also issue other types of patents:

Utility model patents. The ideas must still be novel, but it is less important that there is a “non-obvious step”

Design patents. These require the shape, pattern and/or colour of a manufactured object’s design to be new, but do not require there to be a novel technical aspect

Skewed figures

A total of 2.9 million invention patent applications were filed worldwide in 2015, according to Wipo, marking a 7.8% rise on the previous year.

China can lay claim to driving most of that growth. Its domestic patent office – the Property Office of the People’s Republic of China (Sipo) – received a record 1,101,864 filings. These included both filings from residents of China and those from overseas innovators who had sought local protection for their ideas.

The tally was more than that of Sipo’s Japanese, South Korean and US equivalents combined.

Applicants based in China filed a total of 1,010,406 invention patents – the first time applicants from a single origin had filed more than one million in a single year.

But they appeared to be reticent about seeking patent rights abroad.

According to Wipo, China-based inventors filed just 42,154 invention patent applications outside their borders – Huawei and ZTE, two smartphone and telecoms equipment-makers, led the way.

There was a rise in the number of medical tech patent filings from China

By comparison US-based inventors sought more than five times that figure. And Japan, Germany and France also outnumbered the Asian giant.

One patent expert – who asked not to be named – suggested the disparity between Chinese inventors’ local and international filings reflected the fact that not all the claims would stand up to scrutiny elsewhere.

“The detail of what they are applying for means they would be unlikely to have the necessary degree of novelty to be granted a patent worldwide,” he said.

But Wipo’s chief economist said things were not so clear cut.

“There is clearly a discussion out there as to what is the quality of Chinese patents,” said Carsten Fink.

“But questions have also been asked about US and other [countries’] patents.”

And one should keep in mind that China is a huge economy.

“If you look at its patent filings per head of population, there are still fewer patents being filed there than in the United States.”

Patent boom

Part of the reason so many applications were made locally was that China set itself a target to boost all types of patent filings five years ago.

Sipo declared at the time that it wanted to receive two million filings in 2015.

The government supported the initiative with various subsidies and other incentives.

Adding together China’s invention, utility and design patents, its tally for 2015 was about 2.7 million filings, meaning it surpassed its goal by a wide margin.

One London-based patent lawyer noted that Chinese firms were not just filing patents of their own but also buying rights from overseas companies.

“This all goes to show the growth of the telecoms and high-tech industries in China, and that these companies are playing a more significant role globally than hitherto,” said Jonathan Radcliffe from Reed Smith.

“The fact we are now seeing them suing and being sued for patent infringement in Europe and in the US on subject matter such as mobile phones and telecoms standards – and indeed seeing Chinese companies suing each other over here in Europe for patent infringement – shows that they have truly arrived.”

Source: China breaks patent application record – BBC News

17/10/2016

China launches longest manned space mission | Reuters

China launched its longest manned space mission on Monday, sending two astronauts into orbit to spend a month aboard a space laboratory that is part of a broader plan to have a permanent manned space station in service around 2022.

The Shenzhou 11 blasted off on a Long March rocket at 7:30 am (2330 GMT) from the remote launch site in Jiuquan, in the Gobi desert, in images carried live on state television.

The astronauts will dock with the Tiangong 2 space laboratory, or “Heavenly Palace 2”, which was sent into space last month. It will be the longest stay in space by Chinese astronauts, state media reported.

Early on Monday, Fan Changlong, a vice chairman of China’s powerful Central Military Commission, met astronauts Jing Haipeng and Chen Dong and wished them well, state news agency Xinhua reported.

“You are going to travel in space to pursue the space dream of the Chinese nation,” Fan said.”With all the scientific and rigorous training, discreet preparation, and rich experience accumulated from previous missions, you will accomplish the glorious and tough task… We wish you success and look forward to your triumphant return.”

Shenzhou 11 is the third space voyage for Jing, who will command the mission and celebrate his 50th birthday in orbit.

In a manned space mission in 2013, three Chinese astronauts spent 15 days in orbit and docked with a space laboratory, the Tiangong 1.Advancing China’s space program is a priority for Beijing, with President Xi Jinping calling for the country to establish itself as a space power.

China insists its space program is for peaceful purposes.

Shenzhou 11, whose name translates as “Divine Vessel”, will also carry three experiments designed by Hong Kong middle school students and selected in a science competition, including one that will take silk worms into space.

The U.S. Defense Department has highlighted China’s increasing space capabilities, saying it was pursuing activities aimed at preventing other nations using space-based assets in a crisis.

China has been working to develop its space program for military, commercial and scientific purposes, but is still playing catch-up to established space powers the United States and Russia.

China’s Jade Rabbit moon rover landed on the moon in late 2013 to great national fanfare, but soon suffered severe technical difficulties.

The rover and the Chang’e 3 probe that carried it there were the first “soft landing” on the moon since 1976. Both the United States and the Soviet Union had accomplished the feat earlier.

China will launch a “core module” for its first space station some time around 2018, a senior official said in April, part of a plan for a permanent manned space station in service around 2022.

Source: China launches longest manned space mission | Reuters

14/10/2016

Infosys cuts annual revenue target for 2nd time as U.S. election, Brexit weigh | Reuters

India’s second-largest software services exporter Infosys Ltd cut its fiscal-year revenue growth target for the second time in three months on an uncertain business outlook, sending its shares tumbling more than 5 percent.

Reporting a 6.1 percent rise in second-quarter net profit, Infosys said on Friday it now expected revenue to grow between 8 percent and 9 percent in constant currency terms in the fiscal year to March 31, 2017. Its previous revenue growth target, issued in July, was 10.5-12 percent, already lowered from the up to 13.5 percent it said it expected in April.India’s more-than-$150 billion software services sector depends on North America and Europe for the majority of its revenue. The impending U.S. presidential election and the implications of Britain’s ‘Brexit‘ move to exit the European Union have both weighed on spending by western clients.

Infosys had warned in August it was seeing some “softness” in business after the June Brexit vote in Britain.

Chief Executive Vishal Sikka said in a statement on Friday the revision took into consideration “our performance in first half of the year and the near-term uncertain business outlook”.

After falling as much as 5.3 percent after the guidance cut was announced, Infosys shares were trading 2.6 percent down at 0453 GMT in a Mumbai market that was little changed.

For its fiscal second quarter to Sept. 30, its consolidated net profit rose 6.1 percent from a year earlier to 36.06 billion rupees ($541.51 million), ahead of analysts’ estimates of 35.26 billion rupees. Revenue rose 10.7 percent to 173.1 billion rupees.The company said on Friday it added 78 clients during the three months to September, taking its total number of active clients to 1,136.

($1 = 66.5919 Indian rupees)

Source: Infosys cuts annual revenue target for 2nd time as U.S. election, Brexit weigh | Reuters

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