Daily News Digest- 21st Nov'14

Thought of the Day:

Today in History:

Following made the Headlines:

India:

• Indian E-comm Market to Hit $15b by 2016: Google: Increasing Internet penetration and growing preference for shopping online will drive the commerce market in India to $15 billion by 2016 with a whopping 100 million people going online to shop, Google said on Thursday. Compared to 8 million in 2012, about 35 million people are now buying everything from apparel to electronics to cosmetics and furniture from online stores. “The online shopper base will grow 3X by 2016 and over 50 million new buyers will come from tier I and II cities,“ Google India MD Rajan Anandan said.

• Flipkart Rejigs Top Deck for Next Level of Growth: Flipkart is shuffling its top deck, hiring senior professionals and engaging with management consultants as the seven-year-old company sheds its startup skin. These moves that have gained pace in recent weeks are aimed at creating a new organisational structure for India's largest online retailer while bringing in new talent to manage its phenomenal growth. “The organisation is reflecting what we believe about our business and our strategy in terms of preparing ourselves for rapid and massive growth,“ said Mekin Maheshwari, Flipkart's chief people officer, who has previously held positions like head of payments and head of technology. “There is going to be a lot of experimentation from the business model and business point of view and also in terms of how we attack business problems from an organisation point of view.“ Sharad Agarwal, head of tech platforms at mobile advertising firm InMobi, is likely to join the online retailer in the coming weeks, according to a person with direct knowledge of the matter. The company declined to comment on Agarwal joining the company. If he does, that will be Flipkart's fifth big hire in recent weeks, following other high-profile ones such as its chief financial officer Sanjay Baweja from Tata Communications and Rishi Vasudev from Calvin Klein India. The Bengaluru company has also promoted four people as senior vice presidents -Ankit Nagori, Vaibhav Gupta, Sameer Nigam and Rajnish Baweja.

• UberGO Faces Challenge on Day of Launch: Uber Technologies faced teething troubles on Day 1 of its low-cost cab service, which the company claims is cheaper than taking an auto, with taxis unavailable across New Delhi throughout the day. Attempts to hail an uberGO cab at least a dozen times from five to six loca tions in the city yielded a one-in-four success rate. Uber launched the service with a 25% discount on the already lower fares. “This is only the first day of our launch and the demand from riders has been tremendous. As the word gets out amongst the driver community, our supply will build quickly and our teams are working hard to get more cars on the road, improving availability of uberGO in the city,” the San Francisco-based start-up said in response to ET’s queries. Uber introduced its low-cost cab hailing service uberGO on Thursday across 10 cities, at fares that it claims are less than autorickshaw rides. The response to the new offering — a global-first service launched exclusively for India, its fastest growing market outside the US — created a supply-demand gap, the company said.

• Ride-sharing app startup Tripda to drive into India: German startup incubator Rocket Internetbacked Tripda, a ride-sharing marketplace, is entering India at a time when the likes of Uber and Ola are slugging it out in a highly competitive cab market. Tripda connects passengers with drivers who are travelling long distance, acting like a carpooling service unlike the other technology-backed cab startups that are hired for shorter rides. Started earlier this year in Brazil, Tripda now operates in ten countries including the US and some Asian markets.Tripda works through its website and mobile app where anyone can post a ride and then carpool irrespective of their location. “Operationally , our initial focus in India will be Delhi, MumbaiPune and Bangalore. But anyone outside these cities can use the ser vice as well. If you see the website, we already have rides happening in cities beyond the ones mentioned,“ Nitish Bhushan, country manager, Tripda, told TOI. Tripda is similar to the French venture BlaBlaCar which recently raised $100 million from venture capital firms Index Ventures and Accel Partners, among others.BlaBlaCar plans to use its funding to grow its business and expand to markets like Turkey , Brazil and India, its co-founders have said.

• Urban Consumers Give White Goods, FMCG Sales a Boost: Consumer goods across biscuits, soft drinks, microwave ovens and refrigerators are seeing a distinct revival in demand, driven mainly by a consumption uptick in urban markets, says latest data by market researchers IMRB and GfK. FMCG value consumption in urban markets was up 7% in the July-September 2014 period, against 2% in the corresponding year-ago period, according to IMRB data, although rural demand didn't register any growth. Mayank Shah, deputy marketing manager at top biscuits maker Parle Products, attributed the rise in urban consumption to a growing optimism about the economy and positive sentiment. “Consumption has picked up, especially in urban markets over the past two months, which hopefully will sustain going forward.“ Latest data from the white goods industry tracker GfK reveals that Indian appliances like microwave ovens and refrigerators are logging double digit volume growth this fiscal after flat sales in the past two years. By value, the growth is much higher upwards of 20%, which industry executives said is driven by higher average purchases from urban pockets.

• TechM to buy US- based LCC for $ 240 mn: Information technology services firm Tech Mahindra on Thursday announced signing of a definitive agreement to acquire US- based Lightbridge Communications Corporation ( LCC) for an enterprise value of $ 240 million, one of its biggest foreign acquisitions to date. The all- cash deal would be funded through internal accruals, the company said. LCC, among the largest global players in the network services management, is expected to hit a revenue of $ 430 million for the calendar year 2014. Its Ebitda ( earnings before interest, tax, depreciation and amortisation) margin is higher than eight per cent. The 5,700 employees of the US firm, across 50 countries, are to join Tech Mahindra after the acquisition, taking the latter’s total headcount to 100,000. LCC has built 350 networks and designed more than 350,000 cell sites for over 400 customers globally; the acquisition is expected to bring 20- 30 new clients to Tech Mahindra.

• Retailers bank on fashion to drive margin: Retail chains such as Shoppers Stop, Future Retail and Pantaloons are banking on fashion to boost margins. Margins in the apparel segment are said to be about 40 per cent; those for private labels are higher. “ Basically, it is the fashion or apparel segment that is going up. Our apparel margins are much higher than non- apparels, and when the share of apparel is going up, you obviously get better margins,” Shoppers Stop Managing Director Govind Shrikhande said during a recent conference call. For the quarter ended September, Shoppers Stop recorded an earnings before interest, taxes, depreciation and amortisation ( Ebitda) margin of 6.1 per cent, 98 basis points more than in the year- ago period. The company expects the margin to be 6- 6.5 per cent in FY15, 7- 7.5 per cent in FY16 and about eight per cent after that. During the September quarter, the share of the apparel segment in Shoppers Stop’s business rose to 67 per cent from 63.6 per cent in the corresponding period last year. The margin of its hypermarket chain, HyperCITY, rose 140 basis points in the September quarter and the company expects this to further rise 50- 80 basis points in FY16, by when the contribution of fashion to HyperCITY’s overall sales will increase to 19 per cent.

• Mumbai adds to Metro rail with two new corridors: In another push to the infrastructure in Mumbai and around, the state- run Mumbai Metropolitan Region Development Authority ( MMRDA) has cleared two major metro rail corridor projects. These are the 40- km Dahisar- CharkopBandra- Mankhurd line (₹ 25,605 crore) and a 32km Wadala- Ghatkopar- Thane- Kasarvadavali corridor (₹ 19,097 cr). The first of these two corridors, of 36 stations, will be entirely underground. The Wadala- Kasarvadavali one will have 24 underground and six elevated stations. These are to be implementedbyMumbaiMetroRailCorporation, astate government undertaking, by 2020- 21. Half the cost will come via loans taken from international finance agencies. The central government will provide 20 per cent. The state government and MMRDA will get the other 30 per cent, via both equity and debt. The decision was taken at MMRDA’s board meeting on Thursday, chaired by Chief Minister Devendra Fadnavis.

International:

• H&M Opening Mexico Store: H&M in summer of 2015 will open a store with more than 25,000 square feet of space in Playa del Carmen in Mexico’s eastern state of Quintana Roo. Playa del Carmen used to be a small fishing village until a passenger ferry to Cozumel was inaugurated. The popular tourist spot along the Caribbean has been evolving with new luxury condominiums, hotels, restaurants, entertainment venues and retailers. H&M’s unit will be located in a mixed-use project encompassing an entire block along 5th Avenue between 12th Street and 14th Street, which is being developed by Thor Urbana. The property will have 340 square feet of frontage on Fifth Avenue, Playa del Carmen’s main shopping corridor. There’s space for several other global fashion brands and plans have been announced for a Thompson Hotel, the first branded lifestyle boutique property in the Mayan Riviera, which runs south from Cancun to Tulum.

• Zappos Opens First Store: Zappos today is launching a 20,000-square-foot pop-up shop in downtown Las Vegas. The physical store, Zappos’ first, is driven by technology and will be open for business 24-7 during the holiday period though Dec. 31. The Zappos pop-up shop is merchandised with 16 different areas offering everything from couture to athletic wear. Zappos joins other e-tailers dipping a toe into physical retail such as Warby Parker, Boohoo and Nasty Gal, which opened its first physical location on Melrose Avenue in Los Angeles. Steve Hill, vice president of merchandising at Zappos, said the company had been talking about physical retail for the past year, but didn’t want to do a traditional store. “We didn’t know how we would convey the breadth of the assortment,” he said. Then Zappos partnered with OrderWithMe, a retail logistics firm that’s been managing its inventory for more than four years and recently raised $28 million. OrderWithMe uses algorithms that allow mom and pop retailers to band together and buy in bulk at a discount.

• Amazon begins its Black Friday deals a week early: There’s a routine for modern holiday shopping in the US: either you line up outside stores at crazy hours for Black Friday deals, or you wait until ‘Cyber Monday’ if you don’t feel like waiting out in the cold. This year though, Amazon is shaking things up – they’re starting their holiday sales a whole week early. Beginning tomorrow, Amazon will be adding new lightning deals as frequently as every ten minutes until the end of actual Black Friday on November 29. Prime members get access to deals 30 minutes early. Still, it seems like Amazon is savings its biggest deals for last, with three ‘Deals of the Day’ on both Thanksgiving and Black Friday itself, so it’s worth keeping an eye on the site’s dedicated Black Friday page.

• Sotheby's chief executive steps down after 14 years: The chief executive of renowned auction house Sotheby's, William Ruprecht, is stepping down after 14 years in the role. Mr Ruprecht would leave his post by "mutual agreement" after a successor was found, Sotheby's said on Thursday. His departure comes a year after activist investor Dan Loeb started demanding changes at the auction house. Last week, chief competitor Christie's significantly outsold Sotheby's in contemporary art auctions in New York. Rival Christie's sold a record $852.9m (£543m) in works, compared to $343.7m at Sotheby's during flagship sales held every November. "We are moving with a sense of urgency, but we will take the time we need to find the right leader for Sotheby's at this critical juncture in its continuing evolution," said director Domenico De Sole in a statement about Mr Ruprecht's departure.

• Mad Over You Launches T-Shirts to Make a Difference: A T-shirt that makes a difference: Ian Madover just launched Mad Over You with that goal in mind. Proceeds from the sale of each item don’t just go to charity. Madover works directly with community centers across the U.S., allowing the kids there to contribute designs. For each item sold, the company will donate 100 percent of its net profits to these partnering centers. Madover was also behind Ouchies bandages, which partnered with organizations such as D.A.R.E. America and The Childhood Leukemia Foundation. In his quest for a perfect T-shirt, he consulted his three children, who advised him to incorporate a way to support kids living in America. “I started this partly as a T-shirt company and partly as a new way of connecting consumers over organizations that are helping people,” Madover said. “Part of them were designed by kids in community centers across the U.S., and we came up with attainable goals, all under $50,000.”

• Frank & Oak Partners With Etsy: Men's e-tail brand Frank & Oak is partnering with Etsy for a line of home products. The line features nine items from four artists, each working with a different medium. All products are handcrafted in North America. Price points range from $29 for a concrete soap dish to $100 for an antique organ-pipe knife rack. Frank & Oak cofounder and chief executive officer Ethan Song said the partnership is about "supporting emerging artists and entrepreneurs," as well as advising individuals beyond their apparel choices. The Frank & Oak site also offers grooming products, books and footwear. The brand, which recently opened its brick-and-mortar flagship site in Toronto on Nov. 13, targets men in the creative fields. In October, the company closed on a Series B funding round of $15 million. The operation is a vertical one and there is a new collection every month. Song co-founded the firm with Hicham Ratnani in 2012.

• The Elder Statesman Opens First Store: The founder and owner of luxe cashmere lifestyle brand The Elder Statesman started his line in 2007 with a cashmere blanket sold at Maxfield, then not only soldiered on through the recession with items retailing in the thousands of dollars but also grew into a ready-to-wear, accessories, eyewear and kids clothing brand. The company won the $300,000 CFDA/Vogue Fashion Fund prize in 2012 and received an investment from Chrome Hearts earlier this year. Now, in addition to private sales and about 65 points of sale worldwide — befitting the brand’s unique nature, its number-one market is Switzerland — The Elder Statesman has its own store to call home. The store is in what was, literally, a home in the heart of West Hollywood: 607 N. Huntley Drive, off the western stretch of Melrose Avenue, where tenants like Balenciaga, Rag & Bone, Urth Caffe and Bodhi Tree bookstore make for eclectic and fashionable foot traffic.

Tech: 

• Cry, My Camera! I Now have a Selfie Phone: This should interest India's prime minister -selfiefriendly smartphones and accessories are among the fastest-selling items in India's ever-expanding phone market.And, correspondingly, cheap digital cameras, until recently an Indian consumer favourite, are fast losing ground. Selfie-loving Narendra Modi's latest photo is of himself and Australian PM Tony Abbot, heads together and smiling away. Young Indians buying phones designed for taking the best selfie may have a few suggestions for the PM on how to take the best selfie. Selfie phones that help you take the best photo of yourself come with better quality front cameras -5 megapixel and above. Sony, Nokia, Gionee, Panasonic, Micromax, Karbonn and Lava have launched selfie smartphones over the last couple of months. And the big two at the top end -Apple and Sam sung -have vastly improved the quality of their front cameras. Despite being a new entrant, selfiefriendly phones accounted for over 4% of India's 23-million smartphone market in the July-September quarter, according to data from Counterpoint Research. Experts say the trend will get stronger & stronger.

• Netflix now accounts for 35 percent of overall US internet traffic: According to a new report from Sandvine, a company that builds equipment for consumer internet service providers, Netflix has topped 35% of overall US internet traffic. The streaming service now reportedly uses 34.89 percent of downstream and 9.4 percent of upstream bandwidth during peak periods on US fixed lines. Sandvine’s report suggests that Netflix is using a whopping 20% more bandwidth than the nearest downstream competitor, YouTube. Netflix is second only to BitTorrent traffic for upstream bandwidth, with the torrenting protocol at a huge 25.49 percent. You might be wondering why Netflix uses upstream traffic when it’s not a peer-to-peer service; Ars Technica has a great report on why this is. The last time Sandvine released a report in 2013, Netflix traffic was only at 31.6% of overall bandwidth usage in th US. The average home is now using 20.4GB every month for Netflix alone, according to the report.

• YouTube Music Key is now available for Google Play All Access subscribers: YouTube’s new Music Key subscription service was set to roll out this week, and it looks like it’s now available for most users on mobile and the Web. If you’re already subscribed to Google Play Music All Access, you’ll be automatically enrolled in Music Key. The opposite is true as well.

• Twitter Launches Sharing Public Tweets in Direct Messages: Twitter is moving towards making DMs (Direct Messages) more like the messaging apps that have captured the globe. But first, it wants to make sure you can share public tweets privately with your friends. Today the micro-blogging service introduced its promised update to DMs. Now Twitter users on iOS, Android can share public tweets with others via DMs. To share a tweet, all you have to do is long-press on the tweet in question and you’ll be presented with “Share via Direct Message.” On the Web and in Tweetdeck for Chrome, Web and Windows, the feature is under the •••More icon. For OS X users of Tweetdeck, the feature is “coming soon.” Earlier this week Twitter updated its infrastructure so allow all users to send URLs via DMS. Both of these updates are part of the company’s on-going strategy to not only give Direct Messages some love, but also make them a major player in the messaging wars. While many Twitter users use DMs to chat with friends, followers and colleagues, it’s nowhere nearly as robust as other services out there including Facebook’s Messenger app, What’sApp (also part of Facebook) and Line. But the company is working change that.

• Facebook Expands Its Drone Team To Bring Internet To All: Facebook has posted three new job vacancies for its drone team today. Its seeking avionics, thermal, power systems and control engineers to work on the aircraft project. The company was already advertising for three drone-related job openings – looking for both technicians and engineers – in its London office. The UK is becoming quite a hub for tech companies pushing into unmanned aerial vehicle (UAV) research. Amazon began recruiting to expand its Prime Air delivery drone research team last week. Facebook’s UK-based job openings were published a few months after it acquired British drone maker Ascenta in March. It’s confirmed to Recode that the latest vacancies will be based at its California HQ. The latest additions to Facebook’s drone team will be technicians working on assembling the aircraft and an engineer assisting “in the development, inspection and testing of the high-altitude solar powered aircraft.”

• Dropbox launches Carousel Photo App for iPad and Web: Dropbox Carousel, the photo gallery app launched for iOS and Android smartphones last spring, is now available for the iPad and the Web. A version for Android tablets will be released in two weeks, the company said. The tablet app is scaled and designed for larger mobile screens and works in much the same way as the mobile phone apps. All photos viewed in Carousel actually reside in Dropbox, but the app is designed to work quickly so that accessing and sharing photos in Carousel is indistinguishable from photos stored on your local device. In addition, Dropbox has tweaked the design of Carousel phone apps to make them easier to use and nicer to look at. The new version improves the grid view, the lightbox and the conversations interface. “The old grid view had a lot of white space in between photos and events that wasn’t very aesthetically pleasing, so we created this new grid view that fills up all the white space by making some of your photos larger than others,” Chris Lee, Carousel product manager, told TNW. “We particularly focus on the photos of people and make them extra big.”