Asha to Ashes: Microsoft’s Emerging Markets Conundrum

A piece I wrote with Devi in Delhi, and the help of a couple of other colleagues. 

Asha to Ashes: Microsoft’s emerging market conundrum

By Jeremy Wagstaff and Devidutta Tripathy

SINGAPORE/NEW DELHI | Thu Sep 5, 2013 9:22pm EDT

(Reuters) – Microsoft Corp’s acquisition of Nokia’s handset business gives the software behemoth control of its main Windows smartphone partner, but leaves a question mark over the bigger business it has bought: Nokia’s cheap and basic phones that still dominate emerging markets like India.

Microsoft Chief Executive Steve Ballmer has said he sees such phones – of which Nokia shipped more than 50 million last quarter – as an entree to more expensive fare.

“We look at that as an excellent feeder system into the smartphone world and a way to touch people with our services even on much lower-end devices in many parts of the world,” he said in a conference call to analysts on Tuesday.

But analysts warn that’s easier said than done.

The problem, said Jayanth Kolla, partner at Convergence Catalyst, an India-based telecom research and advisory firm, is that Microsoft simply lacks Nokia’s retail and supply chain experience in the Finnish company’s most important markets.

“The devices business, especially the non-smartphones business in emerging markets, is a completely different dynamic,” he said.

Kolla pointed to the need to manage tight supply chains, distribution, and building brands through word-of-mouth. “Microsoft doesn’t have it in its DNA to run operations at this level,” he said.

India is a case in point. Nokia has been there since the mid 1990s and the country accounted for 7 percent of its 2012 revenue while the United States generated just 6 percent, according to Thomson Reuters data. Its India roots run deep: it has a presence in 200,000 outlets, 70,000 of which sell only its devices. One of its biggest plants in the world is in the southern city of Chennai.

For sure, Nokia has slipped in India as elsewhere: After nearly two decades as the market leader it was unseated by Samsung Electronics Co Ltd in overall sales last quarter.

But it still sold more of its more basic feature phones.

As recently as last October, market research company Nielsen ranked it the top handset brand. The Economic Times ranked it the country’s third most trusted brand.

LOYALTY RUNS DEEP

In a land of frequent power cuts and rugged roads, the sturdiness and longer battery life of Nokia’s phones have won it a loyal fan base – some of whom have stayed loyal when trading up.

Take Sunil Sachdeva, a Delhi-based executive, who has stuck with Nokia since his first phone. He has just bought his fifth: an upgrade to the Nokia Lumia smartphone running Microsoft’s mobile operating system.

“Technology-wise they are still the best,” he said of Nokia.

But Microsoft can’t take such loyalty for granted. Challenging it and Samsung are local players such as Karbonn and Micromax, which are churning out smartphones running Google Inc’s Android operating system for as little as $50.

Such players are also denting Nokia’s efforts to build its Asha brand, touchscreen devices perched somewhere between a feature phone and a smartphone.

Nokia shipped 4.3 million Asha phones globally in the second quarter of this year, down from 5.0 million the previous quarter.

“The sales performance of the Asha line has been quite poor,” said Sameer Singh, Hyderabad-based analyst at BitChemy Ventures, an investor in local startups. “With increasing competition from the low-end smartphone vendors, I’m unsure how long that business will last.”

That leaves the cheap seats. Singh estimates that the Asia Pacific, Middle East and Africa accounted for two-thirds of Nokia’s feature phone volumes in the last quarter, at an average selling price of between 25 to 30 euros ($32.99 to $39.59).

“I don’t see how Microsoft can really leverage this volume,” he said. “The market is extremely price sensitive and margins are racing into negative territory.”

TOO BIG TO IGNORE

The quandary for Microsoft is that while the basic phone market may be declining, it may simply be too big to ignore.

“If you look at markets like India and Indonesia, more than 70 percent of the volume comes from the feature phone business,” Anshul Gupta, principal research analyst at Gartner said. “It’s still a significant part of the overall market.”

That means that if Microsoft wants to herd this market up the value chain to its Windows phones, it needs to keep the Nokia and Asha brands afloat – while also narrowing the price gap between its smartphones and the feature phones and cheap smartphones.

Microsoft has hinted that lowering prices of smartphones would be a priority. The Windows Phone series includes the top-end Lumia 1020, which comes with a 41-megapixel camera, while it also sells simpler models such as the Lumia 610 and 620 aimed at first-time smartphone buyers.

“The lower price phone is a strategic initiative for the next Windows Phone release,” Terry Myerson, vice president of operating systems said on the same conference call, while declining to provide details.

An option for Microsoft, analysts said, would be to shoe-horn services like Bing search, Outlook webmail and Skype, the Internet telephony and messaging application, into the lower-end phones as a way to drive traffic to those services and make the devices more appealing.

“So you can bundle services with these low-end products and that way you can reach a wider audience,” said Finland-based Nordea Markets analyst Sami Sarkamies.

But in the meantime Microsoft needs to brace for assault on all fronts as emerging market rivals see an opportunity to eat further into Nokia’s market share. In India, said Convergent Catalyst’s Kolla, cheap local Android brands have been held back by Nokia’s strong promotion of its mid-tier Asha brand.

“Now, I expect them to pounce,” he said. ($1 = 0.7577 euros)

(Reporting By Jeremy Wagstaff in Singapore, Devidutta Tripathy in New Delhi, Bill Rigby in Seattle, Ritsuko Ando in Helsinki; Editing by Emily Kaiser)

Facebook can’t take Asian growth for granted

A piece I wrote ahead of Facebook’s IPO, casting a skeptical eye over assumptions that Asia would continue to be a source of major growth for the company.

Even as Facebook fever grips investors ahead of the social networking giant’s potential $100 billion-plus initial public offering, its breakneck growth in Asia may be slowing as it moves beyond desktop users to those who access the Internet largely or solely from a mobile phone.

In March, Facebook revised its own SEC filings to scale back its scope for further growth in India – its third-biggest user base and the largest population it currently has access to – China remains off-limits to Facebook. And independent data show that user numbers in Indonesia and the Philippines, its other largest Asia user bases, have actually fallen off slightly in the past three months.

“If you’ve been growing at such a huge amount it will definitely trail off,” said Ganesh Kumar Bangah, Kuala Lumpur-based CEO of online payment provider MOL Global. “You can’t expect it to keep growing.”

Read the rest: Analysis: Facebook can’t take Asian growth for granted

Facebook’s daunting Asian challenge

Here’s a piece I pulled together with the help of Reuters reporters Andjarsari Paramaditha, Camilo Mejia and Estelle Griepink in JAKARTA, Harichandan Arakali in BANGALORE, Lee Chyen Yee in HONG KONG, Kazunori Takada in SHANGHAI and Harry Suhartono in SINGAPORE.

Facebook aims to connect all two billion Internet users. So far it has captured 845 million of them. Of the rest, nearly 60 percent live in Asia and hooking them is going to be a daunting challenge.

A block on access in China, court cases in India and rivalry from other services elsewhere in the region stand between Mark Zuckerberg’s Facebook and more than 700 million users.

"The size of our user base and our users’ level of engagement are critical to our success," Facebook said in its SEC filing for an initial public offering. Quoting industry data that there were two billion Internet users globally, it said: "We aim to connect all of them."

Growth is held back in the rest of the world, either because of limited Internet penetration, or because those who want a Facebook account already have one.

Full text here.

Former Soviet Bloc, Allies, Under Lurid Attack

Trend Micro researchers David Sancho and Nart Villeneuve have written up an interesting attack they’ve dubbed LURID on diplomatic missions, government ministries, space-related government agencies and other companies and research institutions in the former Soviet bloc and its allies. (Only China was not a Soviet bloc member or ally in the list, and it was the least affected by the attack.)

Although they don’t say, or speculate, about the attacker, it’s not hard to conclude who might be particularly interested in what the attacks are able to dig up:

Although our research didn’t reveal precisely which data was being targeted, we were able to determine that, in some cases, the attackers attempted to steal specific documents and spreadsheets.

Russia had 1,063 IP addresses hit in the attacks; Kazakhstan, 325; Ukraine, 102; Vietnam, 93; Uzbekistan; 88; Belarus, 67; India, 66; Kyrgyzstan, 49; Mongolia, 42; and China, 39.

The campaign has been going for at least a year, and has infected some 1,465 computers in 61 countries with more than 300 targeted attacks.

Dark Reading quotes Jamz Yaneza, a research director at Trend Micro, as saying it’s probably a case of industrial espionage. But who by? ”This seems to be a notable attack in that respect: It doesn’t target Western countries or states. It seems to be the reverse this time,” Yaneza says.

Other tidbits from the Dark Reading report: Definitely not out of Russia, according to Yaneza. David Perry, global director of education at Trend Micro, says could be out of China or U.S., but no evidence of either. So it could be either hacktivists or industrial espionage. Yaneza says attackers stole Word files and spreadsheets, not financial information. “A lot of the targets seemed to be government-based,” he says.

My tuppennies’ worth? Seems unlikely to be hactivists, at least the type we think of. This was a concerted campaign, specifically aimed to get certain documents. Much more likely to be either industrial espionage or pure espionage. Which means we might have reached the stage where groups of hackers are conducting these attacks because a market exists for the product retrieved. Or had we already gotten there, and just not known it?

Either way, Russia and its former allies are now in the crosshairs.

More reading:

Massive malware attacks uncovered in former USSR | thinq_

Cyberspy attacks targeting Russians traced back to UK and US • The Register

Why We Work in Starbucks

(this is a copy of my Loose Wire Service column, syndicated to newspapers; hence no links.)

By Jeremy Wagstaff

Why do we work in Starbucks? It’s a question I ask myself every day, because I usually find myself in one at least once. This despite having an excellent home office replete with cappuccino machine, music, ergonomic chair and, most importantly, sofa. But lo, every day I wend my way to a Starbucks, or one of those other chains, and park myself in an uncomfortable chair and too-low table, dodging the students with their bags strewn across space they’ll never use, the dregs of a smoothie enough to make it look as if they’re paying their way, babies screaming blue murder by the sugar dispenser.

Why? Why do I do it?

Well, I think it has to do with noise. And a cycle that goes back 300 years and, importantly, has to do with organ grinders.

So first, the organ grinders.

Next time you look out of your window and you don’t see an organ grinder making his way down the street, you can blame Charles Dickens. And Tennyson, Wilkie Collins and 28 authors, painters, engravers, illustrators, historians, actors, sculptors, musicians, architects and scientists. All of them, in 1863, co-signed a letter that “in their devotion to their pursuits—tending to the piece and comfort of mankind—they are daily interrupted, harassed, worried, wearied, driven nearly mad, by street musicians.” Most gave their home and work address as the same. The letter was the centerpiece of a 120-page bill submitted before the British parliament by one Michael Thomas Bass. The letter, and dozens of others, reflect a single themes: a rearguard action to defend the home as workplace against the slings and arrows of street noise.

This was no idle irritant. The streets of central London had become a sea of itinerant workers, musicians and hustlers. Those who didn’t like to have their ears assailed by the noise could either pay them off or complain. But the latter was not without risk. One of Dickens’ friends confronted two street musicians and was insulted, in the words of a friend, “in the choicest Billingsgate.” Another, Charles Babbage, inventor of the Difference Engine, waged a guerrilla war against street musicians from Manchester Square and was not popular for it: mobs, some numbering more than 100, would pursue him, leave dead cats on his doorstep, break his windows and threaten his life.

The Street Music Act was passed the following year, and decimated the itinerant musician community—among them violin-players and street bands, Irish and Scotch pipers, a German brass-bandsman, a French hurdy-gurdy-player, Italian street entertainers, and percussionists and minstrel singers from India and the United States. Many were gone by the latter years of the century—but so were most of the knowledge workers, who upped sticks to the suburbs or took refuge in offices.

The truth is that knowledge workers, or whatever we choose to call ourselves, have long struggled to control the level of noise in our world.

I’ve waged my own noise battles over the years—dogs in Hong Kong flats, car alarms in Singapore, firecrackers in Indonesia. But at issue is not the pursuit of silence, per se, but to find a place where the noise is conducive to work. And that’s trickier—because we’re not sure what it is.

Which is where the coffee house comes in.

Starbucks likes to portray itself as a “third place”—a term purloined from Ray Oldenburg, an urban sociologist, who mourned the demise of informal public gathering places. The idea is that your local Starbucks fulfills a role beyond just providing  you with coffee, but connects you to others in your community, along with sparkling conversation and wit.

The truth is this doesn’t happen—at least not in any Starbucks I know, a point made by historian Bryant  Simon, who hung around in more than 400 Starbucks trying to strike up conversations with strangers. Despite what Starbucks would like us to believe, with its Annual Report covers of friendly people chatting in their outlets, faux artwork and lame noticeboards, and a short-lived community magazine called Joe, we don’t come to Starbucks to chat. Well, not with strangers.

That dream pretty much died long before Dickens got hot under the collar about the racket-making riff raff . Back in the 1700s there were things called coffee houses, all over the place. They were the place where men met—women were usually banned—to drink coffee, read the paper, discuss politics and basically to get away from things (meaning the house.)  These were vibrant, noisy places and there were lots of them. Samuel Johnson called them ‘penny universities.’

But they began to die out, ironically, when newspapers became cheaper and more plentiful, and were delivered to your home. Then the reason for someone to go to a coffee house declined, and our knowledge workers began two centuries of toiling, either in a cubicle or alone at home.

Starbucks—and other things—have brought us full circle. Starbucks was never what Starbucks would like us to think it is: It is, primarily, a solo-friendly environment. You can go there on your own, order something and sit there on your own and no-one is going to bat an eyelid. Social phobics feel uncomfortable there, but less uncomfortable than pretty much any other eatery. Indeed, the size of tables, the size of the chairs, the layout of the place, is designed to cater to someone alone.

Which is why it has become the perfect workplace. It’s not just the free Wi-Fi, the power outlets, the no-nag policy, although that helps. It’s a complex social and psychological thing. For students, libraries are too quiet, too noisy, too old, too full of friends. You are less likely to fall asleep in a Starbucks. For those who work at home, they feel they might be missing something. Or they like to watch other people. It’s a place for introspection, a refuge from the city, from the kids, from everything: There are people around you, but with no obligation to talk to them. The barista can be as friendly or as taciturn as you want her to be. It’s not a sexy environment, and it’s relatively safe: Leave your belongings while you visit the washroom and they may well still be there when you get back.

For people who work in an office it’s refuge from the boss, the people hanging around your cubicle, the greyness of it all, the phones ringing. In libraries it’s people whispering—loud enough to hear them whispering, but not loud enough to hear what they’re whispering about.

So it’s actually often about noise. It turns out we actually need noise. We just need a certain kind of noise.

JK Rowling wrote Harry Potter in a cafe. Stephen King writes to AC/DC or Guns n Roses. Xerox chief researcher John Seely Brown did his doctoral thesis in a bar.

Researchers in Sweden found that actually a certain level of white noise actually helped kids with Attention Deficit Disorder concentrate better. Apparently it’s something to do with increasing the levels of dopamine activity in the brain.  Canadian researchers found that masking noise—adding white noise to their work environment to reduce the intrusion of things like ringing phones—also helped office workers. Kodak issued a manual a few years ago advising offices to do just this—48-52 decibels is the best level, they reckon. Perhaps Dickens and co could have saved themselves the wrath of the mob if they’d installed a white noise machine or invented the iPod.

It’s also related to the way we work, and communicate, today. It’s tempting to imagine Dickens hunched up in the corner scribbling Nicholas Nickleby. But while we knowledge workers have something in common, our tools are quite different, and what we’re asked to do with them: we’re all touch typists, of a sort, which means we write dozens of words a minute. We answer emails as if we were flicking dust off our coat. We write proposals, reports, requests for proposals  that not long ago would have taken teams a month to write. Laptops are lighter, with better battery life, and connected to a communications network. We are our office. Companies realize they don’t need to shackle people to their desks all day—less than 40% of our time, according to one property consultancy, is actually spent at our office desk.

We operate in a supercharged environment, which makes the coffee shop of today a perfect setting. Visual and audible stimulation, but with none of the distraction of having to be sociable. Oh and the coffee. It’s no coincidence, I suspect that caffeine also increases the production of dopamine in the brain. A double whammy of noise and caffeine.

If you’ll excuse me, I need to head off. You know where you can find me.

Concentration in the Public Space

By Jeremy Wagstaff

Why do we work in Starbucks? It’s a question I ask myself every day, because I usually find myself in one at least once. This despite having an excellent home office replete with cappucino machine, music, ergonomic chair and, most importantly, sofa. But lo, every day I wend my way to a Starbucks, or one of those other chains, and park myself in an uncomfortable chair and too-low table, dodging the students with their bags strewn across space they’ll never use, the dregs of a smoothie enough to make it look as if they’re paying their way, babies screaming blue murder by the sugar dispenser.

Why? Why do I do it?

Well, I think it has to do with a cycle that goes back 300 years and, importantly, has to do with organ grinders.

So first, the organ grinders.

Next time you look out of your window and you don’t see an organ grinder making his way down the street, you can blame Charles Dickens. And Tennyson, Wilkie Collins and 28 authors, painters, engravers, illustrators, historians, actors, sculptors, musicians, architects and scientists. All of them, in 1863, co-signed a letter that “in their devotion to their pursuits—tending to the piece and comfort of mankind—they are daily interrupted, harassed, worried, wearied, driven nearly mad, by street musicians.” Most gave their home and work address as the same. The letter was the centispiece of a 120-page bill submitted before the British parliament by one Michael Thomas Bass. The letter, and dozens of others, reflect a single themes: a rearguard action to defend the home as workplace against the slings and arrows of street noise.

This was no idle distraction. The streets of central London had become a sea of itinerant workers, musicians, hustlers, and, well humanity. Those who didn’t like to have their ears assailed by the noise could either pay them off or complain. But the latter was not without risk. One of Dickens’f riends, John Leech, a writer and cartoonist for Punch, confronted two street musicians and was insulted, in the words of a friend, “in the choicest Billingsgate.” Another, Charles Babbage, inventor of the Difference Engine, waged a guerrilla war against street musicians from Manchester Square and was not popular for it: mobs, some numbering more than 100, would pursue him, would leave dead cats on his doorstep, broke his windows and threatened his life.

Bass’ Street Music Act was passed the following year, and decimated the itinerant musician community—which numbered at least 1,000, including English violin-players and street bands, Irish and Scotch pipers, a German brass-bandsman, a French hurdy-gurdy-player, Italisn street entertainers, and numerous percussionists and minstrel singers from England, India and the United States. Many were gone by the latter years of the century—but so were most of the knowledge workers.

Some stayed put—one Thomas Carlyle built a soundless room in his attic in Chelsea—but most moved out to the suburbs where things were altogether quieter. It’s not clear who won, but the first battle between knowledge worker and concentration had been fought.

The organ grinders have gone, but the knowledge workers are still around. But our search for a conducive work environment goes on.

Which is where the coffee house comes in.

Starbucks likes to portray itself as a “third place”—a term purloined from Ray Oldenburg, an urban sociologist, who mourned the demise of informal public gathering places. The idea is that your local Starbucks fulfills a role beyond just providing  you with coffee, but connects you to others in your community, along with sparkling conversation and wit.

The truth is this doesn’t happen—at least not in any Starbucks I know, a point made by historian Bryant  Simon, who hung around in more than 400 Starbucks trying to strike up conversations with strangers. Despite what Starbucks would like us to believe, with its Annual Report covers of friendly people chatting in their outlets, faux artwork and lame noticeboards, and a short-lived community magazine called Joe, we don’t come to Starbucks to chat. Well, not with strangers.

That dream pretty much died long before Dickens got hot under the collar about the racket-makingriff raff . Back in the 1700s there were things called coffee houses, all over the place. They were the place where men met—women were usually banned—to drink coffee, read the paper, discuss politics and basically to get away from things (meaning the house.)  These were vibrant, noisy places and there were lots of them. Smanuel Johnson called them ‘penny universiteies.’

But they began to die out, ironically, when newspapers became cheaper and more plentiful, and were delivered to your home.

Then the reason for someone to go to a coffee house declined, and our knowledge workers began two centuries of toiling, either in a cubicle or alone at home.

Now that is all changing. For lots of reasons. Laptops are lighter, with better battery life, and connected to a communications network. We are our office. Companies realise they don’t need to shackle people to their desks all day—less than 40% of our time, according to one property consultancy, is actually spent at our office desk.

Starbucks cottoned on early to this. It started out just selling coffee beans or ground but realised that people lingered after their purchase, and so gave them chairs and tables and put in a coffee machine. As crime in the inner cities fell in the 1990s the middle classes wanted to get out of their homes and feel their way back into the city. And Starbucks was the place they went—familiar, safe, but further away.

Starbucks was never what Starbucks would like us to think it was, however: It is, primarily, a solo-friendly environment. You can go there on your own, order something and sit there on your own and no-one is going to bat an eyelid. Social phobics feel uncomfortable there, but less uncomfortable than pretty much any other eatery. Indeed, the size of tables, the size of the chairs, the layout of the place, is designed to cater to someone alone.

Which is why it has become the perfect workplace. It’s not just the free WiFi, the power outlets, the no-nag policy, although that helps. It’s a complex social and psychological thing. Here’s what I found from forums and surveys of users of places like Starbucks:

For students, libraries are too quiet, too noisy, too old, too full of friends. You less likely to fall asleep in a Starbucks. For those who work at home, they feel they might be missing something. Or they like to watch other people. It’s a place for introspection, a refuge from the city, from the kids, from everything: There are people around you, but with no obligation to talk to them. The barrista can be as friendly or as taciturn as you want her to be. It’s not a sexy environment, and it’s relatively safe: Leave your belongings while you visit the washroom and they may well still be there when you get back.

For people who work in an office it’s refuge from the boss, the people hanging around your cubicle, the greyness of it all, the phones ringing. In libraries it’s people whispering—loud enough to hear them whispering, but not loud enough to hear what they’re whispering about.

So it’s actually often about noise. It turns out we actually need noise. We just need a certain kind of noise.

JK Rowling wrote Harry Potter in a cafe. Stephen King writes to AC/DC or Guns n Roses. Xerox chief researcher John Seely Brown did his doctoral thesis in a bar.

Researchers in Sweden found that actually a certain level of white noise actually helped kids with Attention Deficit Disorder concentrate better. Apparently it’s something to do with increasing the levels of dopamine activity in the brain.  Canadian researchers found that masking noise—adding white noise to their work environment to reduce the intrusion of things like ringing phones—also helped office workers. Kodak issued a manual a few years ago advising offices to do just this—48-52 decibels is the best level, they reckon. Perhaps Dickens and co could have saved themselves the wrath of the mob if they’d installed a white noise machine or invented the iPod.

It’s also related to the way we work, and communicate, today (it’s also helped shape it.) It’s tempting to imagine Dickens hunched up in the corner scribbling Nicholas Nickleby. But while we knowledge workers have something in common, our tools are quite different, and what we’re asked to do with them: we’re all touch typists, of a sort, which means we write dozens of words a minute. We answer emails as if we were flicking dust off our coat. We write proposals, reports, requests for proposals  that not long ago would have taken teams a month to write.

We operate in a supercharged environment, which makes the coffee shop of today a perfect setting. Visual and audible stimulation, but with none of distraction. Oh and the coffee. It’s no coincidence, I suspect that caffeine also increases the production of dopamine in the brain. If you’ll excuse me, I need to head off. You know where you can find me.

The Missed Call: The Decade’s Zeitgeist?

By Jeremy Wagstaff

(this is a longer version of an upcoming syndicated column.)

When people look back at the last decade for a technology zeitgeist they may choose SMS, or the iPod, or maybe even Facebook. Me? I’d choose the cellphone call that rings, briefly, and then is silent.

It’s one of those social phenomena that has so embedded itself in the culture that we don’t even notice it. It developed its own syntax, its own meaning, and even shifted the boundaries of cultural mores and social intercourse. Even I didn’t realise it was so widespread until I started researching this article. And yet, at least in the middle of the decade, it spanned all continents and was accounting for more than half of cellphone traffic in many developing countries.

So what is the miscall and why is it—was it–so big? The miscall is simple: I call your cellphone but hang up before you pick up. Instead of you thinking there’s a mistake, you know exactly why I called, and either call me back, or don’t, depending on how we’ve agreed on what the miscall means. It’s a form of communication that requires no words, no speech, and, most importantly, no expense. At least for you and me. Not, sadly, for the cellphone operator.

But initially cellphone operators weren’t too bothered.

There’s a temptation, after all, to regard the miscall as a poverty thing, done by poor people. I don’t have any money; you have money, so you call me. Indeed, in Ethiopia it’s called miskin—Amharic, deriving from the Arabic for “poorest of the poor”, with a distinct connotation of being worthy of pity. And among youth the lure of the cellphone is matched only by the limits on a budget. So, someone somewhere is going to call back, so money will be spent on a call, somehow.

But two researchers for Norway-based Telenor Hanne Geirbo and Per Helmersen found that was only part of the picture, even in a place like Bangladesh. Combing the data from a single day of Grameenphone’s traffic, they concluded that “the charged traffic generated from an initial missed call is minimal compared o the missed call activity.” In short, a missed call didn’t result in a real call.

This was communication in itself, not just a plea for communication.

Not only that: making the missed call was so easy—hit the green button, wait for a ring and then hit red—that it was stopping other services, like SMS, from getting any traction. And we’re not talking small potatoes here: Missed calls constituted upwards of 70% of Grameenphone’s total network traffic in any hour. Some people were sending miss call after miss call, one after the other—100, or even several hundred, miscalls in a short period. This, in the words of the researchers, was “a major cause of congestion at peak periods,” leading to calls disconnected, or not being connected in the first place. In 2005 one Kenyan cellular network estimated that four million miscalls were being made daily on its network.

A miscall, then, is a lot more than a call me back thing. It’s a fast way to communicate a key piece of information to someone who is already expecting it around that time, and only needs to be activated:  “I’m home, throw the gate keys down.” The timing is the context that gives the unspoken, unwritten message meaning: A miscall at 6 pm may mean I just left work.

And, if there isn’t any specific time context it may just mean: “I’m missing you.”

Then there’s the another parameter: how many missed calls are made can vary the message. Two missed calls means “I’m running late” or “I’m at home, where are you?” depending, it would seem, on what part of Bangladesh you’re in. In Syria five missed calls in rapid succession means “I’m online, let’s chat.” There are business uses too: Farmers in Bhutan, according to UNCTAD’s annual Information Economy Report published in October, know how much milk their customers want by the number of miscalls. They then miscall the customer back within 15 minutes; no miscall means no stock. Researchers in India, where miscalls accounted for about 40% of all calls, found that the miscall was used by print and ticketing shops to let their customers know their orders were ready.

Missed calls can be fun if you don’t have much else going on in your life. Try to irritate your friends by miscalling them; if someone is doing it to you, try to pick up before they hang up, losing them credit and the game. This may sound inane, but these calls are likely to be serious network congesters. If the power goes off, the researchers found, Bangladeshis would entertain themselves by miscalling friends, relatives, and even complete strangers. The researchers found one young woman met her boyfriend that way. If you call communicating only by cellphone a relationship. Who said blackouts couldn’t be fun?

Talking of flirting, missed calls can create a private space between two people who couldn’t otherwise connect without fear of exposure or ridicule. One 44-year old Bangladeshi admitted to expressing his love by sending the object of his affections hundreds of miscalls. In Damascus it’s no different: One young man proudly explained to a journalist from Syria’s Forward Magazine last year that he sometimes gets 250 miscalls from his girlfriend.  Young couples in a relationship miscall each other to check the line is free or to keep the line busy—either way ensuring their paramour is not otherwise engaged, so to speak. Starting to feel sorry for the network operator yet?

Husbands expect calls from spouses at fixed times as signals that the house is running smoothly. Children check in with their parents. Newly married women get their mothers to call without incurring the wrath of their mothers-in-law. Friends miscall a member of their circle who couldn’t make their evening out, as if to say: we’re missing you.

There are rules, of course, about who one can and cannot miscall. No one below you in the hierarchy, either in the family, the office, or the community (one man is quoted as specifying “driver and electricians…it’s a matter of prestige.” And don’t miscall your teacher or your boss. At least in Bangladesh. in Africa, where it’s called variously “flashing” and “biper”,  there are complex rules about who can be flashed. Among friends, one commenter on a Nigerian blog said, it’s about exclusion: with miscalls “there is complete communication beyond the scope of outsiders.”

In other words, the missed call is not some reflection of not having enough credit. It’s a medium of exchange of complex messages that has become surprisingly refined in a short period. Much of it is not communication at all, at least in terms of actual information. It’s what the researchers identify as phatic communication: where the interaction is the motivation not the content of the message itself. Or, as a Filipino professor, Adrian Remodo put it to a language conference in Manila in 2007 at which they votedfto make miscall, or miskol in Tagalog, the word of the year: A miskol is often used as “an alternative way to make someone’s presence felt.”

Indeed, the fact that the message itself has no content is part of its beauty. Just as the SMS is confined to 160 characters—meaning it can either be pithy or ambiguous, depending on the effect you’re looking for—so can the missed call be open to all kinds of interpretation. A lover receiving a missed call can fill her evening contemplating what was meant by those few unanswered rings.

The Telenor researchers speak of how this “practice contains valuable information about the communication needs and preferences of our customers.” Very true. But one gets the feeling that their call for more research to “provide the telecom industry with a much-needed window into the socio-cultural life space of our customers , and suggest new service offerings that better match their needs and circumstances” may have fallen on deaf ears.

I’ve not found much evidence of this, and that was written back in 2008. Some African cell providers gave away five free “Please call me” text messages to each subscriber. A Swiss company called Sicap has had some success in Africa with a service called Pay4Me, which is a sort of reverse charge call for mobile phones. The only difference I can see between this and the miscall is that the callee doesn’t have to make the call, so to speak. That, and the fact that most prepaid services nowadays don’t let you make a call if you have a zero balance—which accounts for 30% of African users, and 20% of Indian cellphone users, according to Telenity, one company hoping to offer the callback service.

Telcos in Afghanistan offer polling services where respondents, instead of texting back their answers, miscall a number depending on their choice of answer. More creatively, some socially minded organisations have used the miscall as a cheap way to communicate: Happypill, for example reminds you to take medication if you fail to miscall them at an appointed time each day.

The point is that while usage may vary it’s common in many countries—and has been for much of the past decade. As soon as mobile phones came with prepaid vouchers, and operators included the name and number of the caller on the handset display, so did the opportunity arise for someone to pay for your call.  In France and in French-speaking Africa it’s called “un bip”, I’m told, and one commenter said that it’s included in some prepaid packages. In Iran it’s called “tak”; in Australia “prank” and in the U.S. “drop call”. In Italy, apparently, it’s called “squillo” and in Oman a “ranah” (where there’s even a pop song based on the practice).

And it goes further back than that: “Call me and hang up when you arrive,” my mum used to say to her impoverished student son.

Of course, there are reasons to be concerned about this. One Indian columnist wrote:

What, then, will happen to the human voice? If two rings on the mobile are sufficient to say “I miss you”, what will become of the impassioned verses that poets have so far written to appease their beloved? I wonder how a dialogue will sound in a world where voices have become ringtones.

It may be that the miss call culture is in decline. Jonathan Donner, a Microsoft researcher who has looked into this phenomenon more than most, noted back in 2007 a “beep fatigue”, leading some to turn off their caller ID function and ditch phone numbers that clearly indicate they are on a postpaid package. And in some places where the costs of a call and an SMS have fallen to pretty much nothing, the appeal of the miscall has waned in some places.

An SMS would work, but requires typing, and in a place like Bangladesh, where more than half the population is illiterate that’s not a popular option. And text messages sometimes take a couple of minutes to arrive: a call is immediate—something that’s apparently important to my Filipino friends.

Then there’s the fact that the missed call can be discreet in a way that a phone call, or an SMS, can’t be. You could make a miscall from inside one’s bag or pocket (and I frequently do, though that’s by accident.)  Which may explain why, a student  in Pakistan wrote earlier this year:

what amazes me the most is unlike other fads such as texting obsessively etc have gone away pretty quick ,this ‘miss call’ culture still reigns supreme in most of our society.

My tupennies’ worth? As the SMS, which created its own culture out of the limitations of what was not supposed to be a commercial service, so has the miscall created its own norms. Whether these survive the next decade is unlikely. But we should watch these things carefully, not because they represent commercial opportunities—we’re bound to mess that up—but because they speak volumes about the inventiveness of the human spirit, and its ability to squeeze rich new forms of communication out of something that, on the surface, seems to be nothing—a briefly ringing, and unanswered phone.

Facebook in Asia: Seeds of Decline?

Some thoughts after trawling through data I’m collecting on Facebook membership in selected Asia Pacific countries

Membership of Facebook in developed Asia Pacific territories declined for the first time in a year in September, suggesting, possibly, that interest in the social networking site in the region has peaked. The figures may also reveal insights on whether, in developing countries, a social networking site can break out of their middle class enclaves.

Facebook populations in Australia, New Zealand, Singapore and Hong Kong all fell during the month, while those in Indonesia, Malaysia and the Philippines all either grew only marginally or shrank somewhat. Hong Kong dropped by the largest margin—5.7%—while Thailand, alone among the countries under study, grew by more or less the same amount.

India and China, though included in the study, offer a more confusing picture. China’s data may be unreliable: after showing slow but steady growth until April, membership dropped precipitously before rising by nearly 140% in the past month. The reasons for these spikes and dips are unclear, but may have something to do with China’s limits on access to the service. In any case, the proportion of China’s real population remains negligible.

India’s too is negligible, although it did rise above 1% in July and and has been growing by between 400,000 and 1.7 million people per month. In most other countries that would be noteworthy.

But while the data overall remain questionable—these figures are from Facebook’s own statistics, but are not transparent, and are based on where members say they are from or in—there are some identifiable trends:

  • Australia and New Zealand seem to have not only hit a limit in terms of percentage of their overall population who are on Facebook (45% and 41% respectively), but may actually have begun to decline. After recording impressive growth up until May, membership plateaued for a month or two before falling in September. Google Trends graphs measuring traffic to facebook.com in these countries seem to confirm this. (Australia; New Zealand)
  • Hong Kong and Singapore seem to be in a similar boat. While more than half of Hong Kong was on Facebook in July, and nearly 49% of Singapore was on Facebook in August, both populations shrank in September. Only five months ago both territories were recording double digit growth.
  • Thailand is still growing, as is the Philippines. But both are from low bases: Less than 3% of Thailand began the year on Facebook, although that has now grown to 8%. The Philippines has risen from about 10% of the population to about 18% in the same period, but growth in both has dropped recently from earlier rates of up to 25% per month.
  • Indonesia is an interesting case. Its membership, too, was surging in the first half of the year—twice growing by a quarter in the space of a month—but has slowed considerably in the second half. Indeed, its population seems to have plateaued at about 11% of the overall population. That pretty much covers the country’s middle class, according to my calculations. (I wouldn’t want to labor the point, but based on the latest ADB figures, Indonesia is remarkable in the way that Facebook has extended beyond what would usually be considered the middle class limits of an Internet-based service. Those considered to be middle class or above by the ADB is about 11.6% of the population, which is exactly where Facebook’s Indonesia population currently stands. The Philippines—at 18.25%, about 5 percentage points behind the ADB’s calculation of the country’s middle class—has a little way to go, while Malaysia’s Facebook population has space to double in size. Of course, this has a lot to do with the growth of the mobile Internet, which is another topic in itself. )

Previous Facebook data posts:

Facebook in Asia: A Limit to Growth? – loose wire blog

Facebooks Asian Growth: Not Everywhere is North – loose wire blog

Stuck on Stuxnet

By Jeremy Wagstaff (this is my weekly Loose Wire Service column for newspaper syndication)

We’ve reached one of those moments that I like: When we’ll look back at the time before and wonder how we were so naive about everything. In this case, we’ll think about when we thought computer viruses were just things that messed up, well, computers.

Henceforward, with every mechanical screw-up, every piston that fails, every pump that gives out, any sign of smoke, we’ll be asking ourselves: was that a virus?

I’m talking, of course, about the Stuxnet worm. It’s a piece of computer code–about the size of half an average MP3 file–which many believe is designed to take out Iran’s nuclear program. Some think it may already have done so.

What’s got everyone in a tizzy is that this sort of thing was considered a bit too James Bond to actually be possible. Sure, there are stories. Like the one about how the U.S. infected some software which a Siberian pipeline so it exploded in 1982 and brought down the whole Soviet Union. No-one’s actually sure that this happened–after all, who’s going to hear a pipeline blow up in the middle of Siberia in the early 1980s?–but that hasn’t stopped it becoming one of those stories you know are too good not to be true.

And then there’s the story about how the Saddam Hussein’s phone network was disabled by US commandos in January 1991 armed with a software virus, some night vision goggles and a French dot matrix printer. It’s not necessarily that these things didn’t happen–it’s just that we heard about them so long after the fact that we’re perhaps a little suspicious about why we’re being told them now.

But Stuxnet is happening now. And it seems, if all the security boffins are to be believed, to open up a scary vista of a future when one piece of software can become a laser-guided missile pointed right at the heart of a very, very specific target. Which needn’t be a computer at all, but a piece of heavy machinery. Like, say, a uranium enrichment plant.

Stuxnet is at its heart just like any other computer virus. It runs on Windows. You can infect a computer by one of those USB flash drive thingies, or through a network if it finds a weak password.

But it does a lot more than that. It’s on the look out for machinery to infect—specifically, a Siemens Simatic Step 7 factory system. This system runs a version of Microsoft Windows, and is where the code that runs the programmable logic controllers (PLCs) are put together. Once they’re compiled, these PLCs are uploaded to the computer that controls the machinery. Stuxnet, from what people can figure out, fiddles around with this code within the Siemens computer, tweaking it as it goes to and comes back from the PLC itself.

This is the thing: No one has seen this kind of thing before. Of course, we’ve heard stories. Only last month it was reported that the 2008 crash of a Spanish passenger jet, killing 154 people, may have been caused by a virus.

But this Stuxnet thing seems to be on a whole new level. It seems to be very deliberately targeted at one factory, and would make complex modifications to the system. It uses at least four different weaknesses in Windows to burrow its way inside, and installs its own software drivers—something that shouldn’t happen because drivers are supposed to be certified.

And it’s happening in real time. Computers are infected in Indonesia, India, Iran and now China. Boffins are studying it and may well be studying it for years to come. And it may have already done what it’s supposed to have done; we may never know. One of the key vulnerabilities the Trojan used was first publicized in April 2009 in an obscure Polish hacker’s magazine. The number of operating centrifuges in Iran’s main nuclear enrichment program at Natanz was reduced significantly a few months later; the head of Iran’s Atomic Energy Organization resigned in late June 2009.

All this is guesswork and very smoke and mirrors: Israel, perhaps inevitably, has been blamed by some. After all, it has its own cyber warfare division called Unit 8200, and is known to have been interested, like the U.S., in stopping Iran from developing any nuclear capability. And researchers have found supposed connections inside the code: the word myrtle, for example, which may or may not refer to the Book of Esther, which tells of a Persian plot against the Jews, and the string 19790509, which may or may not be a nod to Habib Elghanian, a Jewish-Iranian businessman who was accused of spying for Israel and was executed in Iran on May 9, 1979.

Frankly, who knows?

The point with all this is that we’re entering unchartered territory. It may all be a storm in a teacup, but it probably isn’t. Behind all this is a team of hackers who not only really know what they’re doing, but know what they want to do. And that is to move computer viruses out of our computers and into machinery. As Sam Curry from security company RSA puts it:

This is, in effect, an IT exploit targeted at a vital system that is not an IT system.

That, if nothing else, is reason enough to look nostalgically back on the days when we didn’t wonder whether the machinery we entrusted ourselves to was infected.

Bangalore Social Media Journalism Training

There are still some spots available for a two-day training session I’m conducting in Bangalore, India for WAN-IFRA onJune 17-18 2010 on Integrating Social Media to Journalism:

Twitter, Facebook, MySpace, LinkedIn, Digg, Delicious, Orkut have all changed the way that people learn, confirm and share information. How can journalists and editors make use of this new social media for their stories? How can social media be used to increase the productivity of our journalists and editors? How can social media be used to promote content and to build loyalty and trust with readers? What are the tools that they have to use?

The training programme has three modules:

1.) Digital tools for reporters
2.) Integrating Social Media into the workflow and
3.) Writing for online

The training contents include Web 2.0 and its impact on media, cellphone basics: how to get more out of cellphones, reporting tools: a look at ways of reporting better using Web 2.0 services, gadgets and software, plus modules on Wikipedia, mashups, twitter, GPS and others.

The participants will learn how to use the hardware and software to be a better journalist and how to integrate social media into their reporting, editing and newsroom. A considerable amount of time will also be used to help print journalists looking to upgrade their skills to be able to think, report, write and create for online.

Target Group
Management executives, publishers, editors, reporters, journalist and producers who want to get familiar with the new tools for convergent journalism.

If you’re interested contact V Antony by email or by phone on +9194442110640 or fax: +9144424359744.

(A translation of this page into Haitian Creole is available, courtesy of Susan Basen.)