Daily News Digest- 18th Sept'14

Thought of the Day:

Today in History:

Following made the Headlines:

India:

• Xi Arrives With a Fistful of $: Chinese President Xi Jinping arrived in Ahmedabad on Wednesday on a three-day visit.As with PM Modi's trip to Japan, the focus is on economic ties, particularly investment in India's creaking infrastructure. On Day 1, the two countries signed three state-to-state agreements. The corporate sector was more prolific, with as many as 24 deals. Deals worth $100 billion are said to be in the works, compared with a mere $35 billion from Japan.

• Amway and Tupperware Seek to Halt Sales at Online Retailers: Direct selling firms are facing the heat from online retailers. Amway, Tupperware and Oriflame have issued notices to e-commerce sites including Snapdeal, Flipkart and eBay, asking them to stop selling their products. The merchandise of these three direct sellers is not only offered at discounts as high as 40% but also bypass and strike at the very heart of the direct-sales distributor model that these firms follow globally. In the direct selling model, there are no sales through traditional retail outlets -companies hire distributors who, in turn, sell products to consumers. Most times, errant distributors themselves supply unsold stocks to e-commerce sites and the firms are working to identify and penalise them. “Oriflame products are not allowed to be sold by unauthorised persons, entities and means and we have issued notices to these ecommerce platforms that are selling our products. The sale of our products on these online platforms not only diverts sales from our distributors but also undermines the essence of direct selling as a proposition,“ Vivek Katoch, director corporate affairs at Oriflame, maker of cosmetics and personal grooming products, told ET. Katoch said from a consumer point of view, some products need recommendations and usage details, which is not possible with online sales. Tupperware, which sells plastic storage containers, too, has written to e-commerce sites. “We have written to many of the e-commerce sites informing them about the disruption they are causing to our distributors and sales force and requested them to stop selling our products on their websites,“ Tupperware CMO Chandan Dang said. Dang added that the easy availability of discounted products on e-commerce sites has been disruptive for the firm's distributors and sales force and is hitting their earnings. The emergence of e-commerce sites, which are online marketplaces where vendors can sell a range of products, has disrupted traditional models of retailing. Earli er, some manufacturers had warned shoppers against buying their products from e-commerce sites, which they said were not authorised sellers. Snapdeal, which has a network of more than 50,000 merchants and brands, said all vendors on its site are registered only after their applications are reviewed. “Snapdeal.com is an online marketplace where businesses can list and sell their products across diverse categories. All sellers are screened and registered businesses. The decision on the pricing solely rests with the sellers,“ a spokesperson for Snapdeal said. The direct selling industry, with estimated sales of 7,000 crore and growing at 12-14%, is one of the fastest-growing non-store retail formats in the country. A spokesperson for the country's largest direct selling firm, Amway, which sells nutrition and beauty products, said: “Our code of conduct explicitly states that unauthorised Internet selling violates agreements with Amway and our rules department regularly monitors this activity to prevent prohibited selling. We have taken legal action in the past when these rules are violated and will continue to do so to protect customers and individual entrepreneurs ¬ Amway business owners (ABOs).“ Amway business owners are the ‘only' authorised sellers of Amway products. The firms have also written to the government through the Indian Direct Sellers Association (IDSA) to issue clear guidelines on this matter to protect the industry.

• Luxé Brands Look to Catch Big Fish via Mass Media: It is unusual for a top jewellery brand, which sells super expensive items such as a 50-crore necklace through auctions, to put out advertisements in cinema halls for the popcorn-munching audience. But designer Nirav Modi's namesake jewellery label does exactly that recently. “Be it someone who earns 5,000 or 5 crore a month, everyone watches films in India. It is a great way to reach out to a larger set of potential buyers,“ the designer reasons. “But what you show and where has to be chosen wisely. “ Modi is one of the numerous luxury players who have started using mass media including TV, cinema, DTH and mainstream newspapers to reach out to a larger set of audience and open new areas of growth, rather than limiting themselves to the glossy sheets of lifestyle magazines and airport billboards. A host of luxury brands across categories such as luxury clothing, jewellery, automobile, watches and cosmetics, including Jaguar, Bentley and Rado, have started advertising through cinema halls and televisions. The Collective, a multi-brand retail store chain that sells premium and luxury merchandise from a 100 brands in India, is contemplating tying up with DTH services providers to put out ads through the digital video recorders, while cosmetics brand Forest Essentials that markets itself as luxury ayurveda has launched television commercials. “It is just a thought at the moment, but would be an interesting way to target the consumer who is not aware about the brand,“ said Amit Pandey , marketing head for The Collective. He is of the view that experimenting with mediums new to luxury brands was an investment for the future. “The view is that a lot of wastage happens on mass media, but with so much new money in India, there is a huge opportunity to tap the new consumers,“ he said. The luxury market in India is still minuscule and so is ad spend by luxury brands. Estimates suggest that in China, luxury brands contribute 10% to the media spending, while in India it is 0.5%. That seems to be changing. “Ad spends by luxury brands in India is minuscule compared to global markets,“ said CVL Srinivas, South Asia CEO of media conglomerate GroupM.

• Churn Awaits VC Industry as Investment Pros Jump Ship: The churn in venture capital industry could continue as investment professionals begin exploring options outside the space, driven by a mix of opportunities offered by new economy ventures, increased early-stage investing and poor performances by funds themselves. Earlier this month, Kanwaljit Singh, senior managing director at Helion Venture Partners, became the latest high-profile name to quit a storied investment firm. It has been rumoured that he will be starting his own consumer and consumer technology-focused seed-stage venture. The announcement comes at a time when Helion, which manages assets of over $600 million across three funds, has increasingly turned its investment focus on mobile and technology ventures, while Singh, a veteran in the VC stakes in India, is primarily known for his consumer bets. Singh is currently on the boards of restaurant chain Mast Kalandar and e-com merce retailer Yepme. He declined to comment on his plans, citing ill-health. The movement of personnel has always been more emblematic of the private equity industry, but comes at a time when earlystage investing in the country is touching new highs. VC investments are at their highest level for the first six months of any year since 2010, when $663 million (3,978 crore) was invested, according to consulting giant Ernst & Young. Investments in early-stage companies rose nearly 40% to 121 deals in the first half of 2014 compared with the first half of 2013. Transaction values rose 66% to $605 million (3,630 crore), compared with the year-ago period. “We will see new funds being launched by experienced VCs, which will entirely be based upon domestic capital, unlike the previous Indian funds, which were entirely based upon foreign capital,“ said Rahul Khanna, MD, Canaan Partners. However, the moves have also been forced by the poor exit track record of VC firms in India, which have forced a number of them to stall their fund-raising plans, or even scale down their operations. Some of the firms that have stopped making fresh investments in India over last two to three years include Draper Fisher Jurvetson, Clearstone Venture Partners, KPCB, Sherpalo Ventures, Wal den International and Greylock.

• Puma India head Rajiv Mehta quits: Rajiv Mehta, who headed German sportswear firm Puma’s India business for nine years after setting it up in 2006, has quit. The 35-year-old, whose Twitter handle goes by the name of The_YoungMD, will be succeeded by Abhishek Ganguly, who till now has been heading the sales and retail functions for the brand. Mehta looked after Puma’s operations in India, Sri Lanka, Bangladesh, Bhutan, Nepal and the Maldives. “It has been a great experience for me with Puma. I have decided to follow my own interests now,” he said. Apart from his responsibilities as MD, Puma South Asia, Mehta participated extensively in angel investing. Ganguly, who succeeds Mehta as Puma India MD, had joined the company at its inception in 2005 as a founding director. Puma India now has around 300 stores in 100 cities and towns.

• IndiGo inks $2.6bn deal with ICBC to fund 30 planes: Ahead of placing yet another mega order for aircraft, India's largest domestic airline IndiGo has signed a $2.6-billion deal with Industrial and Commercial Bank of China Ltd (ICBC) for financing over 30 Airbus A-320s. The big ticket deal was announced on the day Chinese President Xi Jinping is in India. In a statement, IndiGo said: “Through this MoU, ICBC will provide IndiGo financial solutions for the introduction of A320 and the other family of aircraft to the fleet in the form of sale and lease back or financial lease or commercial lending. The number of aircraft would be over 30 and the value of the deal would reach to the amount of $2.6 billion.“ Most of IndiGo's aircraft have been sold and leased back. The budget carrier, India's only big profitable airline, is planning an IPO next year.

• Inox upgrade, more cinema halls soon: Goa CM: The newest state government policy will have an intangible benefit on offer for citizens - entertainment, entertainment and more entertainment. Chief minister Manohar Parrikar has responded to the Union Information & Broadcasting (I&B) ministry's permanent status award to Goa as hosts of the International Film Festival of India (Iffi) with a policy to encourage setting up of multiplexes in the state. Much newsprint has been consumed by concerns that Goa does not have necessary infrastructure or the 'culture' to support an international film festival. Goa has been over-reliant on the single multiplex in town, Inox, in Panaji. "Inox will also be upgraded immediately after the 2014 Iffi culminates," Parrikar told reporters. It is a public property - built by the government in 2004. A film festival secretariat complex is being planned within five to ten kilometers of the present Iffi venue, he said. The complex, which is in its early stages of conceptualization, is likely to include an auditorium and cinema halls. "We are likely to link various projects to the complex like the oceanarium to come up at Miramar and the planned convention hall. All the projects will be in the same vicinity. Work on the project is expected to be completed within 12 to 18 months and we want it to be ready by the next Iffi. That is just a target. We plan to begin work on the festival complex in January 2015," Parrikar said. A committee of officials from different state departments will provide the project plan in the next 15 days, he said.

• Kedar Teny named marketing director McDonald’s India: McDonald's India (Hardcastle Restaurants Pvt. Ltd) has hired Kedar Teny as director, marketing and digital. Teny is moving from Hindustan Unilever where he was category head, deodorants. He replaces Rameet Arora in McDonald's who quit the company in July after a four-year stint with the company. "My primary responsibility will be to drive growth by strengthening brand love amongst people we currently serve, and also those we look forward to serving in future," Teny said. This will be led through a combination of innovation and engagement across products and formats, with consumer centricity being the driving force, he said. "The road ahead is challenging and exciting as this iconic brand is steered through an environment of intense industry, economic and competitive pressures," he added. A postgraduate in business administration, Teny started his career with advertising agency Lowe Worldwide in 1999. He moved to Bharti Airtel in 2006 to head the mobility brand team. His key achievements in Airtel include launching the iPhone service in India, mobile commerce, voice search for Hello Tunes and so on. Additionally, he launched the Airtel brand in Sri Lanka. In 2010, he moved to Hindustan Unilever as category director, deodorants. "As we expand the physical footprint, we will chalk out a marketing strategy that will allow us to win with all our consumer segments across geographies through tailor made product and brand propositions," Teny said. The company intends to develop capabilities to cope with fast-changing media habits, especially digital. "There is an entire generation getting harvested with little or no TV dependence," he said. "They are living their lives through the internet and mobile and we are cognizant of the fact that this is an area that we want to focus on as we gear up for the future."

International:

• Sony shares tumble 12% after warning of bigger loss: Sony's shares fell by 12% at the start of trading in Tokyo, after it predicted bigger losses for this year. Shares fell to 1,865.5 yen ($17; £10.5) apiece, after it warned losses for the full year to March would amount to $2.14bn. That's more than four times the previous estimate earlier this year. Sony cited its struggling mobile business, which has been losing money due to competition from global rivals such as Apple and Samsung. The company's high-end Xperia smartphones have not sold well in China and the US because of local competition and limited distribution. It issued the profit warning late on Wednesday, after the close of the Japanese markets. Sony also said it would not pay a year-end dividend for the first time.

• European Union car sales continue recovery as VW shines: European Union new car registrations showed continued signs of recovery in July and August, industry figures show. Sales of new cars were 5.6% higher in July compared to the same month last year, and 2.1% up in August, the Association of European Automobile Manufacturers (ACEA) said. France was the only market to contract in July, with sales falling 4.3%. But in August, even Germany, the EU's leading market, saw sales fall 0.4% compared to the same month last year. Overall, sales grew 6% in the first eight months of the year, said ACEA, "continuing the upward trend that began 12 months ago". This equates to 8,336,159 new car registrations over the period. VW group, comprising Volkswagen, Audi, Seat and Skoda, led the leader board, accounting for 25.4% of total sales between January to August. In second place, the PSA Group, comprising Peugeot and Citroen, achieved an 11.1% market share over the same period, with sales rising 3.9%. Adding to the sense of a French automotive renaissance, Renault sales rose 15.3% over the same period, and its market share rose from 8.6% to 9.4%. Dacia sales, its Romanian low-cost brand, leapt 20.8% in July, before falling back to a 2.7% rise in August.

• US consumer prices fall in August: US consumer prices fell in August for the first time since April 2013, Labor Department figures show. The Consumer Price Index declined 0.2% last month, following an increase of 0.1% in July. Petrol prices fell 4.1% in August, more than offsetting a 0.2% increase in food prices driven by the continuing effects of a drought in California. Despite August's decrease, consumer prices are now 1.7% higher than they were a year ago. In July, the annual rate of inflation was 2%. Declines in the prices of air fares, home furnishings, used cars and clothes all helped to drive the index down, but new vehicles and alcoholic drinks were more expensive. The figures were released as policymakers at the US central bank, the Federal Reserve, prepared to release a statement at the end of their latest two-day meeting. The Fed is expected to provide some indication of how soon it may raise interest rates from their present near-zero level, which has been maintained since December 2008. At present, most analysts reckon the move will come in the second half of 2015. The Fed has an inflation target of 2%, although this is based on a different measure of inflation which is currently even lower than the CPI rate.

• Zara owner Inditex sees profits dip but sales rise: Inditex, the Spanish owner of retailer fashion chain Zara, has reported a fall in first-half profits. Net income at the world's largest clothing retailer fell to 928m euros (£738m; $1.2bn) from 951m euros in the same period a year earlier. However, the fall was smaller than analysts had been expecting, and sales at Inditex's more than 6,400 stores rose 5.6% to 8.1bn euros. In addition, it said sales at the start of the third quarter rose 10%. The company, which is trying to expand its global online sales, said Zara would be selling direct over the internet in 27 markets by the end of September. Zara recently launched online retailing in Mexico and is set to launch online in South Korea next week. It is also planning an online store on China's Tmall e-commerce platform. In addition to Zara, Inditex also owns several other brands, including Massimo Dutti and Pull & Bear.

• Hong Kong tycoon buys 30 Rolls-Royce Phantoms: One of Hong Kong's flashiest tycoons has thrown down the gauntlet to high rollers: Buying 30 Rolls-Royce Phantoms, for $20 million, in a single order. Gambling magnate Stephen Hung is buying the luxury fleet through his casino firm Louis XIII Holdings. The company is building a new casino in the Chinese territory of Macau, and Hung says the cars are needed to transport guests. Louis XIII says the fleet will be the largest in the world. Two of the cars, equipped with "external and internal gold plated accents," are the most expensive Phantoms ever commissioned. "Louis XIII and Rolls-Royce Motor Cars share the same philosophy: to deliver the perfect experience to the world's most discerning customers," Hung said.

• Jimmy Choo to Pledge Industry-Beating Growth in Expected IPO: Luxury shoe brand Jimmy Choo will seek to woo investors with a share market flotation prospectus promising industry-beating annual sales growth of more than 10 percent on the back of aggressive expansion plans in Asia and elsewhere, a source close to the deal told Reuters. The upmarket shoe maker, known for its stilettos worn by Hollywood and Asian stars alike, will decide in the coming days whether it goes ahead with the initial public offering (IPO), depending on market conditions. If launched at the end of this month and depending on the precise timing, it is aiming for a listing at the end of October or early in November, the source said. The IPO, which could value Jimmy Choo at more than 700 million pounds ($1.14 billion), will be the first in the luxury sector since Moncler's successful flotation in Milan last year and would add a third luxury name to London's market after Burberry listed in 2002 and Mulberry in 1996. But this time around the environment has become more challenging, with flagging demand from the Chinese and the Russians and conflicts in Ukraine and the Middle East. Cartier owner Richemont on Wednesday posted slowing sales growth, particularly in Asia, its biggest market. The luxury goods industry has been suffering a slowdown since the second half of 2012, with annual sales growth of the industry's main listed stocks dropping to an estimated 5-6 percent this year, from around 10 percent in 2012. 

• Pronovias Names New Managing Director: Pronovias, the Barcelona-based bridal manufacturer, has appointed Andrés Tejero Sala the group’s new managing director and vice president, effective immediately. He succeeds Manuel Ehrensperger, who took over as chief executive officer at the end of April 2013 and has left the company.  The 48-year-old Tejero Sala will report to president and owner Alberto Palatchi, who said, “I am grateful to Manuel Ehrensperger for his valuable contribution and dedication to the Pronovias project and particularly for his personal values, integrity and transparency, and I wish him the best of luck in his next professional chapter.” Currently a member of the Pronovias Group’s strategic committee, Tejero Sala has a degree in law and economics and a master’s in finance from Southeastern University (now defunct) in Washington. He began his career in 1987 at the Madrid Stock Exchange and later had management roles at Bankers Trust and Credit Suisse First Boston in the London and New York offices. He returned to Spain in 1996 to start a new career in the corporate world, joining Telefónica as group managing director responsible for corporate resources. Between 2001 and 2008, Tejero Sala was ceo of Spain’s Veo TV and, more recently, director general of the Institute of Family Business.

• Fred Segal Names Danielle de Marne VP Merchandising: Paul Blum, who in May was named chief executive officer of Fred Segal, is making his first new hires. Danielle de Marne was named vice president of merchandising, and Ray Chang was hired as creative director of digital. Both are based in Fred Segal’s New York headquarters and report to Blum. De Marne, who will oversee buying and merchandising for Fred Segal, will work closely with the buying teams at the retailer’s stores at SLS Las Vegas and the Los Angeles International Airport, as well as the Tokyo flagship of Fred Segal Japan, which will open in 2015. De Marne is also charged with cultivating relationships between Fred Segal and emerging designers, developing product and negotiating partnerships for the brand. Design and media firm Sandow purchased the rights to the Los Angeles-based Fred Segal in 2012. According to the agreement, the Segal family retains ownership of the Beverly Hills and Santa Monica stores and licenses the name from Sandow. Dallas-based firm Gregory’s owns Fred Segal Feet on Melrose Avenue in Los Angeles. De Marne was vice president of creative services at The Jones Group since January 2013. Prior to that, she was vice president and fashion director for contemporary and emerging brands at Jones, overseeing the image and styling of brands such as Brian Atwood, Rachel Roy, Rafé and Robert Rodriguez. De Marne also held creative positions at Theodora & Callum, Full Picture, Intermix and Scoop. Chang will oversee Fred Segal’s digital and social platforms, including the direction and launch of fredsegal.com. He was creative director of juicycouture.com since 2011, responsible for the brand’s online platforms, marketing campaigns and social media. Prior to that, Chang was art director at Oscar de la Renta, where he was responsible for the design of look books, ad campaigns, marketing and oscardelarenta.com. Before that, Chang was senior art director for Gale Group and art director at Ann Taylor.

• Neiman Marcus Comps Up, But Costs Hit Bottom Line: Neiman Marcus Group Ltd. LLC saw comparable sales rise in the fourth quarter, although the retailer's bottom line was hit by costs associated with its acquisition last October by Ares Management and the Canada Pension Plan Investment Board. In the three months ended Aug. 2, the Dallas-based operator of Neiman Marcus and Bergdorf Goodman registered a net loss of $42.1 million versus net income of $2.9 million in the year-ago quarter, the end of which preceded its Oct. 25 acquisition. Excluding various acquisition- and transition-related charges, adjusted earnings before interest, taxes, depreciation and amortization fell 0.9 percent to $105.8 million from $106.8 million. Revenues declined 0.6 percent to $1.11 billion from $1.12 billion in the 2013 period, with specialty retail sales down 2.9 percent and online sales ahead 7.3 percent to $275.6 million. Comparable sales were up 4.9 percent, with specialty retail ahead 2.3 percent and online up 13.7 percent. The comp trend in the retailer’s final quarter marked a deceleration from the full-year trend. In the 12 months, comps rose 5.5 percent, with specialty retail up 3.4 percent and online up 12.9 percent. Comp results for fiscal 2013 exclude the effect of the 53rd week on the retail calendar. The net loss for the full year was $147.2 million versus net income of $163.7 million, while adjusted ebitda rose 0.9 percent to $677.6 million from $671.5 million. Revenues were up 4.1 percent to $4.84 billion from $4.66 billion in the 2013 fiscal year. Year-end inventories stood at $1.07 billion, 5 percent above the $1.02 billion at the end of last year.

Tech:

• Alibaba in Funding Talks with Snapdeal: China's Alibaba has been in talks with Snapdeal as it looks to enter India's booming online retail industry, according to two people aware of the development. Alibaba, whose mammoth share sale in the US is underway, is considering investment in Snapdeal as one of its options while it sizes up the online consumer market in this country. “India is a huge opportunity for Alibaba,“ said a person directly aware of the matter. “Eventually it will look at entering the business-to-consumer space in India and talks are on.“ The Chinese company, which is expected to be valued at over $165 billion (10 lakh crore) at the conclusion of its initial public offer, has discussed a possible investment with Snapdeal, though both firms are yet to reach any conclusion, said the person. So far, Alibaba has only been linking Indian merchants with overseas buyers and sellers. If it enters the Indian online retail space by aligning with Snapdeal, it will be competing directly against market leader Flipkart and Amazon. While the Chinese company would be a late entrant, it has the advan tage of size -by sales Alibaba is bigger than Amazon and eBay combined -and cash (it will raise up to $25 billion in the IPO this week). “We are currently in a quiet period,“ said Pamela Muñoz, manager (international corporate communications) at ply to an email Alibaba, in reply to an email query on the developments. One source estimated that Snapdeal could raise up to $300 million in a potential round of fund-raising.

• Quikr Raises $60 m from Tiger and Co: Online and mobile classifieds venture Quikr has raised 367 crore, or $60 million, in a round led by hedge fund Tiger Global Management with participation from its current investors, reports Our Bureau from Mumbai. So far this year, Delhi-based Snapdeal has raised a total of $233 million in two rounds of investments, which saw participation from eBay and billionaire Azim Premji’s family office Premji Invest. The last round in May valued the firm at $1 billion. Snapdeal, one of India’s biggest online marketplaces, is also attracting attention from other Asian conglomerates including Japan’s largest ecommerce company Rakuten and communications provider SoftBank, according to sources in the investment banking community. Snapdeal, in which former Tata Group head Ratan Tata has a personal investment, could well be the vehicle to infuse a predominantly Asian flavour to Indian online retail, expected to be worth 50,000 crore by 2016, according to market rating agency Crisil.

• Google, MS & IBM Trying to Lure Indian Startups with Goodies: Google, Microsoft and IBM are trying to lure startups with lakhs of rupees worth of goodies in order to compete with Amazon, which is larger than all its competitors combined in the cloud computing space. Google has launched a program for startups wherein qualified companies would be given $100,000 in cloud credits. Indian startups with revenue of less than half a million dollar and who are a part of Nasscom 10,000 startup program or funded by a select list of venture capital firms would be eligible to apply for the credits. Google has not put a number to the startups it would offer these credits to. Microsoft similarly is offering startups $60,000 in Azure cloud credits along with its Microsoft Azure for BizSpark Plus Offer for software startups with less than a million dollar in revenue. IBM is selectively offering cloud credits to startups through its Catalyst program on Softlayer. The credits are offered only to software companies based on their business plan. Startups are excited with the doles being offered to them from the Internet giants. “I signed up for the Google cloud credits the day it was announced. It would be a big boost for our business,“ said Arjun Zacharia, Co-founder of Bangalore based Wooplr, a social discovery & commerce platform. Zacharia is yet to receive the credits from Google. Amazon declined to comment for the story. As demand for cloud computing is increasing rapidly in India, players such as Google, Microsoft and IBM are trying to disrupt the market, which is currently dominated by Amazon. According to Gartner, no company is actually able to worry Amazon. AWS is the undisputed leader in the cloud market with a five times higher than the cumulative total of fourteen other providers, including Google and Microsoft. “If these program deliver on the promise, they will drive competitive pricing and a possible price war for the public cloud,“ said Naveen Mishra, research director at Gartner. “Amazon has a huge scale due to its global scale and operation, which drives economies for them and puts them in unique position to deliver aggressive pricing. That is something that is helping them in the price-sensitive Indian market.“ With such offers, cloud vendors are also trying to tie-in startups to their platform at an early stage. “Migrating from one cloud platform to the other is extremely difficult and expensive,“ said Sanchit Gogia, chief analyst at Greyhound Research. “Once a startup is tied to a particular vendor, it will be forced to continue using the service and the platform.“ The Google Cloud Computing offer will give a select set of companies with an opportunity to truly scale their business at a stage when $100,000 is probably 5% of the value of the company, says Sanjay Swamy, managing partner, AngelPrime.

• Lava, Intex May Launch Devices Under Android One Early 2015: Lava and Intex, among a new set of Indian handset makers on the Google's Android One programme, are likely to bring handsets based on the project early next year. Rather than a single Android One device each ¬ as was launched by Micromax, Karbonn and Spice on Monday ¬ Lava and Intex are likely to roll out a range of devices simultaneously, which would offer different specifications such as larger screens and better camera quality at wider price points. “It will take us at least three to four months (to launch the devices),“ Intex's head for mobile phones Sanjay Kalirona told ET. The first Android One smartphones from the new set of local players will start shipping after January, said Lava International's cofounder and managing director, SN Rai. Lava owns the Xolo brand under which it sells smartphones, while the parent brand also sells feature phones apart from smartphones. Lava and Xolo will be able to tap into their own design houses, in a way becoming original design manufacturers due to which they will be able to drive price optimisation much deeper through their systems, Rai added. In other words, they may well be able to offer devices with higher specifications at competitive prices. More details on the new smartphones are expected to be revealed in the coming months. Lava is one of nine handset makers that Google's head of Android, Chrome and apps, Sundar Pichai, announced as new partners who will make smartphones under the An droid One umbrella, Google's initiative to offer rich smartphone experience on low-cost devices with set hardware and software standards across handset makers. Lava is India's No. 4 smartphone vendor with a 6% share of the market as per IDC. Intex is a much smaller player. Pichai said on Monday that Google has also signed up international smartphone makers Acer, Asus, HTC, Lenovo, Panasonic and Alcatel One Touch under the project to connect the next five billion people with the Internet and Internet-enabled devices. Going forward, he said, vendors will be free to choose among a set of specifications to make smartphones, allow ing faster updates and better Android experience.

• Samsung goes offline with mobile phones: In a move that might change the dynamics of India's booming mobile phone market, Samsung Electronics, one of the country's largest phone makers, has decided to take the offline retail route even as the rest of the world is moving online. While its peers like Xiaomi and Motorola are busy selling millions of handsets online, the Korean giant has given in to mounting pressure from thousands of brick-and-mortar retailers over predatory online pricing and has decided to extend exclusivity on selling rights of 48 models, including its much-awaited Galaxy Alpha and Note 4, to offline retailers. Offline handset retailers have been facing the heat from their online counterparts due to heavy discounts offered online, which they couldn't match. This has led to the formation of All India Mobile Retailers Association (AIMRA), a body that has vowed to work for the mutual benefits of brick-and-mortar retailers and maintain price hygiene across trade channels. TOI had reported in August that Samsung was facing dealer unrest due to predatory pricing by online retailers. While addressing a large gathering of retailers from AIMRA in the capital recently, a senior executive with Samsung Electronics said: "We have taken action against many rogue distributors, who were dumping their stocks online and beating down the price of our handsets. We are working hard to bring back price hygiene in the market. Our revenues from online sales have come down from 30% to single digit. We also have plans to stop billing WS Retail, the largest reseller on Flipkart." The executive said that Samsung has struck a deal with various e-tailers, wherein the company would give them exclusive rights to sell one or two models in return for the promise that they are going to maintain the price sanctity of Samsung handsets. Earlier this month, Samsung made Flipkart the exclusive launch partner for the Galaxy S5 Mini. Interestingly, according to retailers, the difference in prices between Samsung handsets sold online and offline has narrowed considerably since August when a Galaxy S5 that was being sold for Rs 38,000 at retail stores was being offered for Rs 36,000 online. "Now, there is hardly any difference," an AIMRA spokesperson said.