Print

Comment

Email

Digg

Del.icio.us

Reddit

Recently, Dell and MTNL announced a partnership to offer 3G wireless mobility solution on Dell's select range of laptops and netbooks. A first-of-its-kind this tie-up is likely to give impetus to the mobile broadband segment in the country.

The business model for the netbooks is similar to that of mobile since there is bundling and there is subscription as well. The basic function of netbooks is internet connectivity. Going forward, netbooks are likely to emerge as another revenue stream for the operators and the latter are likely to push this more than the normal voice products because the data usage will be more and the operators would be able to sell long-term plans. For instance, in the just launched Dell-MTNL plan, the subscribers are supposed to pay for 12 months in advance.Consequently, long term plans would help the operators to offer at competitive pricing and thus pushing the sales of netbooks in the country.

An important component of the landmark MTNL-Dell tie-up is the embedded 3G Ericsson module which makes it possible for the device to be connected all the time. The company started manufacturing these last year and has already formed global alliance with LG, Toshiba, Dell and Lenovo.

Though Ericsson forms a partnership with the PC manufacturer, it is also in touch with operators in the country and most of them have shown interest in the concept. “They are just waiting for the spectrum allocation,” says Mats Norin, Vice President, Product Area Mobile Broadband Modules, Ericsson.

Ericsson launched the module last year which has been especially developed for netbooks segment and claims to offer the same functionality of mobile broadband embedded radio module at a much lower price point. Currently the company has a global tie-up with Dell, Lenovo, Toshiba and LG. The company has removed GPS and other some other components from its laptop module to bring down the price point. As of now, in India Ericsson is targeting to push basic netbook module only. However, going forward, they would look at other related products as well.

Netbook is emerging as a big market segment in itself. The economic recession last year was the turning point when lower price point pushed the sales of netbooks the world over. Last year there were 10 mn netbooks sold worldwide but year before it was just 1 million. This year, 25 million netbooks are likely to sell in the global market. With the economic downturn, the device industry shifted focus from enterprise to consumer we also feel that there are smaller form factor coming with smaller devices.

“Last year there were around 4 million modules sold in the market, worldwide. Growth rate is significant and we expect at least 2.5 times of that, that is at least 10 mn in 2009. This is only the PC industry. India is an emerging market but two years ahead, it has the potential to record an exponential growth,” says Norin. As of now, Western Europe is the biggest market for Ericsson but this is going to change with the biggest growth likely to come from Asia Pacific region.

Various business models are also likely to emerge where the marketing of netbooks is concerned. In the Dell-MTNL deal, the bundled product will be available through Dell distribution channel but going forward it might not be so. The operators are likely to try out different models before deciding on one which works the best for them.

gagandeepk@cybermedia.co.in