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Turmoil at OpenAI, Again: Musk Jeopardises the Plans of Sam Altman?

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Turmoil at OpenAI, again!!! And, this could jeopardize the plans of the not-for-profit organization, which would have a far-reaching impact.

Elon Musk said that OpenAI should be renamed ‘super closed source for maximum profit AI’! OpenAI didn’t agree though, but they’re still raising billions of dollars.

Now, people are asking: Is #OpenAI really a non-profit as they say, or are they more focused on making money?

Quite recently, renowned billionaire entrepreneur Elon Musk has filed a lawsuit against the ChatGPT creator OpenAI and its CEO Sam Altman, alleging the departure from the startup’s core mission of developing AI for the greater good rather than commercial gain. There are some other puzzling allegations in Musk’s suit, like the one that OpenAI has become “a closed-source de facto subsidiary” of Microsoft that is focused on making money instead of benefitting humanity.

In doing so, Elon’s lawsuit claims that OpenAI abandoned its original nonprofit mission that he helped to raise funds.

In Musk’s view, this constitutes a breach of a contract. While Musk’s complaint mentions an OpenAI “founding agreement,” no formal agreement has been made public yet.

However, Microsoft’s president, Brad Smith, told the Financial Times that while the companies were “very important partners”, “Microsoft does not control OpenAI”.

This is not the first time Elon Musk has been furious about OpenAI’s future directions and strategies. In 2018, He left OpenAI’s board following disagreements with Altman on research direction.

In response to Elon Musk’s lawsuit, OpenAI stated that he once sought “complete control,” which included “majority equity, initial board control, and becoming the CEO through a merger with Tesla.” However, Mr. Altman and other board members resisted this proposal, citing their belief that it went against the organization’s mission to prevent any individual from having absolute control over OpenAI.

Subsequently, OpenAI established a for-profit entity while maintaining the structure of the original non-profit.

In emails from January 2018 reproduced by OpenAI, Musk agreed with an unnamed sender who encouraged the startup’s co-founders to rely on Tesla as their “cash cow.”

Going into the first quarter of 2018, Tesla reported a cash balance of $3.4 billion after it reported a net loss of $2.24 billion for the full year in 2017, while the revenue for the same year reached $11.8 billion.

In November, Musk said OpenAI transformed from an “open source foundation” to a multibillion-dollar “for-profit corporation with closed source.”

Currently, OpenAI has raised a total funding of more than $13 billion in six rounds, and Sam Altman seeks $7 Trillion from investors, especially from those in the U.A.E., to reshape the business of chips and AI.

Now, OpenAI is reportedly building another model, Q*, that will be even more powerful and capable than GPT4. The company argues that OpenAI is committed under the terms of its founding agreement to make such technology available publicly.

Musk’s lawsuit and OpenAI’s response could result in a rollercoaster ride for a few months for the company, including board room drama, a reshuffling of the board, and an investigation by financial regulators. But the damages could not be limited only to all that. The potential investors who may be interested in Sam Altman’s $7 trillion investment plan may also opt for a wait-and-watch strategy, resulting in a big setback for him as well as the company.

However, it’s important to remember that the true success of AI startups should be judged by their positive impact on the world, not just their profits.

Finding the right balance between profitability and societal welfare is key to ensuring AI benefits everyone.

Elon Musk or Sam Altman, who’s right in this situation? Well, that’s up for debate!

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With the Launch of MacBook Air M3, Apple Has Given A Solid Reason to Ignore M2

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Apple MacBook Air M3

Apple has taken its iconic MacBook Air to new heights by integrating the powerful M3 chip. The latest models, available in 13.6 and 15.3-inch sizes, feature improved battery performance, faster Wi-Fi, enhanced support for external displays, and a suite of remarkable upgrades. With all these impressive features and specifications, Apple positions the new MacBook Air as the world’s best thin and light laptop for everyone.

With the launch of the M3 MacBook Air, Apple has discontinued the 2020 M1 Macbook Air and the 15-inch M2 MacBook Air introduced in June 2023.

Now, the pivotal question arises: Which MacBook Air model stands out as the ideal choice for your purchase or upgrade in 2024? Should you upgrade to a MacBook Air M3 from M2 or M1?

Features of MacBook Air M3

Let’s first talk about one of the most prominent features of the new Macbook Air – the M3 chip.

Equipped with an impressive 8-core CPU, a 10-core GPU, and support for up to 24GB of unified memory, the new M3-powered MacBook Air is a technological powerhouse. This advanced chip in the MacBook Air brings about a significant speed boost, boasting up to a 60% increase compared to its M1 predecessor and an outstanding 13 times faster performance than the fastest Intel-based MacBook Air.

In addition to its computational prowess, the M3 chip in MacBook Air contributes to an extended battery life, offering up to 18 hours of usage. This substantial improvement surpasses the longevity of its Intel-based counterpart by an impressive six hours. However, it’s worth noting that these features are consistent with those found in the MacBook Air equipped with the M2 chip.

A Must-Have Upgrade for M1 and Older MacBook Air Users

The newest 13.6-inch Apple MacBook Air (M3) is the best option for users currently using M1 or older Intel-based models or those yet to own a ‌MacBook Air‌.

MacBook Air M3 is integrated 52.6-watt-hour lithium‑polymer battery ensures extended usage, complemented by the 35W Dual USB-C Port Power Adapter (included with M3 with 10-core GPU and 512GB storage, configurable with M3 with 8-core GPU). Fast-charge capability is also available with the 67W USB-C Power Adapter. The inclusion of a high-resolution 1080p FaceTime HD camera further enhances the user experience, making it a compelling upgrade for users of the MacBook Air M1 2020 or older models.

The new M3 MacBook Air introduces a groundbreaking GPU architecture featuring Dynamic Caching, optimizing GPU memory allocation in real-time. This, coupled with hardware-accelerated ray tracing, results in a significant boost in performance for pro apps and games. Gaming on the new MacBook Air is particularly impressive, offering 1.6x faster performance for users not yet on “Apple silicon”.

It’s important to note that “Apple Silicon” refers to chipsets developed by Apple for its products.

In the 13-inch M3 MacBook Air, photo enhancement with AI using Photomator’s Super Resolution feature is up to 40% faster than the 13-inch model with the M1 chip, and an impressive up to 15x faster for users not yet on Apple silicon. Working with Excel spreadsheets sees a speed boost of up to 35% compared to the 13-inch model with the M1 chip, and up to 3x faster for users not yet on Apple silicon. Additionally, video editing in Final Cut Pro is up to 60% faster than the 13-inch model with the M1 chip, and a remarkable up to 13x faster for users not yet on Apple silicon.

When compared to a PC laptop with an Intel Core i7 processor, the MacBook Air with M3 demonstrates up to 2x faster performance, achieves up to 50% faster web browsing, and delivers up to 40% longer battery life. These advancements make the 13-inch M3 device an appealing choice for users seeking enhanced efficiency and productivity across various tasks.

Overall, the Apple MacBook Air M3 model combines speed, graphics excellence, and enhanced gaming experience, making it a top choice for M1 and older Macbook Air device users seeking a performance boost and extended battery life.

Why Should You Pick M3 over M2?

The latest MacBook Air M3, though sharing many features with its predecessor M2, brings notable upgrades that might influence your decision to upgrade.

The primary enhancement in the latest MacBook Air models is the most powerful M3 chip. In benchmark tests, M3 outperforms the M2 by approximately 17% in single-core tasks and 21% in multi-core tasks. In GPU performance, the M3 showcases a 15% improvement over the M2.

Although both the ‌‌M2‌‌ and M3 feature a 16-core Neural Engine, the M3 distinguishes itself through the adoption of a more advanced ‌‌3nm‌‌ fabrication process. This technological upgrade enhances the efficiency of executing machine learning and AI tasks on the M3 MacBook Air. Additionally, while both chips maintain up to 24GB of unified memory, the M3 leverages the new fabrication process to achieve more efficient utilization of memory bandwidth, contributing to overall improved performance and responsiveness.

Another noteworthy distinction between the M2 and M3 chips lies in their energy efficiency, attributed to the adoption of the ‌3nm‌‌ fabrication process. This advanced process enables the M3 to achieve higher levels of performance without experiencing a corresponding increase in power consumption.

As a result, the MacBook Air with M3 chip stands out for its ability to deliver enhanced performance while maintaining a balance between power efficiency and overall energy consumption.

A notable and unexpected feature in the MacBook Air M3, potentially influencing purchasing decisions for both M2 and M1 users, is its support for multiple monitors, even with the display closed. Addressing a significant complaint from previous MacBook Air users, this change is particularly significant. The ability to connect to two external monitors is a positive change for users needing more screen space.

Another compelling reason to upgrade to the MacBook Air M3 is its support for Wi-Fi 6E, which provides speeds up to 2x faster than Wi-Fi 6 in the MacBook Air with the M2 chip.

Price of Macbook Air M3 vs M2

The pricing strategy for the MacBook Air M3 models adds to their allure, even with a slightly higher cost compared to the M2 model. Following the launch of the MacBook Air M3, the price of the M2 MacBook Air has been reduced to $999.

In India, the 13-inch MacBook Air with M3 is priced at INR 114,900 (INR 104,900 for education), while the 15‑inch starts at INR 134,900 (INR 124,900 for education). In comparison, the 13-inch MacBook Air with M2 now starts at INR 99,900 (INR 89,900 for education). Both variants are available in midnight, starlight, silver, and space grey.

When GST of 18% is excluded for both M2 and M3 MacBook Air models in India, the price of the M3 13-inch becomes INR 94,218, while the M2 13-inch is priced at INR 81,918. This represents a difference of only Rs 12,300, which may be perceived as relatively small for individuals committed to Apple’s ecosystem and who appreciate the quality and features offered by MacBook devices.

Final Thoughts

Apple M3 MacBook Air stands out as the best choice for users stuck with older Air models, such as the M1 or Intel-based versions, or those who eagerly want to join the Apple ecosystem for the first time. The impressive array of features and specifications of the M3 MacBook Air provides ample reasons to favour it over the M2 model.

Additionally, if you intend to purchase a new MacBook Air with a larger screen of 15.3-inch, then the latest M3 model becomes the sole option as the ‌M2‌ 15.3-inch machine has now discontinued.

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Paytm UPI Market Share Drops to Just 11%, Hinting a Long Bumpy Ride Ahead

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Paytm UPI market share 2024

The repercussions of the Reserve Bank of India’s (RBI) ban on Paytm Payments Bank are becoming increasingly evident, with a significant hit to Paytm’s UPI market share. Recent insights obtained by Moneycontrol from banking sources reveal that Paytm‘s UPI market share plummeted to 11% in February 2024, down from the 11.8% it held in January, right before regulatory actions were implemented.

Over the last 10 months, Paytm’s share in India’s UPI market declined by 2.3 per cent points, indicating a turbulent period for the fintech company.

On January 31, 2024, RBI imposed a ban on the banking services offered by Paytm Payments Bank Limited (PPBL), originally set to take effect from February 29, but later postponed to March 15, 2024.

Paytm Struggles to Maintain UPI Presence

It’s noteworthy that in April 2023, Paytm Paytm commanded an impressive 13.3% share of India’s UPI market, marking a robust presence in the digital payment arena. However, in the subsequent nine months, there was a gradual decline in its market presence. The descent began in May, as Paytm’s market share dipped to 13%, followed by a further decrease to 12.8% in June 2023. The downward trend persisted, reaching 12.1% by the end of November 2023.

In January 2024, Paytm UPI market share was 11.8%, indicating a 1.5% point drop over the course of nine months. The trend reportedly continued into February, with Paytm’s UPI share standing at just 11%. Surprisingly, the drop of almost a percentage point within a single month between January and February 2024 occurred despite the fact that the UPI business itself was not directly impacted by the restrictions imposed on the bank by the RBI.

One significant factor contributing to the decline in Paytm’s UPI share is the intense competition within India’s digital payments sector. With major players like Google Pay and PhonePe dominating the market, users are increasingly exploring alternative platforms. The trend of users diversifying their usage patterns is apparent, with Google Pay’s consistent increase in market share from 35% in April 2023 to 36.4% in January 2024, signalling its successful attraction of users. Similarly, Cred, a relative newcomer, has experienced notable growth, rising from 0.5% to 0.9% during the same period.

Additionally, the persistent challenges faced by Paytm Payments Bank, including regulatory notices by RBI, raid by the Enforcement Directorate (ED), and operational changes, have likely contributed to an erosion of user trust. Concerns about the platform’s stability and reliability may prompt users to consider alternative UPI platforms that appear more resilient and trustworthy.

Paytm Challenges

Starting on March 15, 2024, Paytm is set to undergo a pivotal shift in its operational role, transitioning from a standalone payments bank app to a third-party application provider (TPAP). This strategic realignment aligns Paytm with industry counterparts like PhonePe and Google Pay.

The observed decline in Paytm’s share in India’s UPI market doesn’t come as a surprise to the company or industry analysts. According to insights shared by a source with MoneyControl, the anticipated drop in Paytm’s market share post-March 15, 2024, is expected to be significant due to the temporary suspension of onboarding new customers until the TPAP backend becomes operational.

To navigate this transition effectively, Paytm has secured strategic partnerships with Axis Bank, Yes Bank, and HDFC Bank as its payment service provider (PSP) banks in the TPAP service. PSP banks play a crucial role in establishing the connection between UPI apps and the broader banking network. It’s worth noting that Paytm had previously relied on Paytm Payments Bank Limited (PPBL) for this integral function.

Therefore, the collaboration with new PSP banks stands out as a noteworthy and strategic adjustment, a responsive measure aimed at addressing the challenges brought about by the RBI ban.

However, troubles for Paytm’s parent, One97 Communications, seem to be far from over, as the Financial Intelligence Unit-India (FIU-IND) has recently imposed a penalty of Rs 5.49 crore on Paytm Payments Bank for violating money laundering norms. The imposition of this penalty adds to the series of issues the fintech company has been confronting, further impacting its market performance. Paytm shares declined 5.45% in the last five days, trading at ₹412.35 on Monday, March 4, 2024.

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Advertisers Skeptical About ROI: Only 6-7% Growth in Digital Ad Spending For FY24

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digital advertising spending FY24

In today’s digital age, advertising serves a pivotal role beyond the mere promotion of products and services; it is instrumental in building a company’s brand, fostering trust, and establishing credibility. For numerous digital enterprises, advertising has evolved into a major revenue stream. Despite this, India’s advertising expenditure is estimated to grow only 6% YoY, reaching a total of $16-17 billion in FY24, ending March 31, 2024.

Digital Advertising, in particular, will account for the majority, 55-56%, of India’s total advertising spend in FY24, amounting to $8.8-9.3 billion. However, the anticipated growth in this sector is expected to remain moderate at approximately 6-7% YoY throughout the fiscal year. This growth appears minuscule in comparison to the remarkable surge observed in FY22, where the digital ad market grew an extraordinary 66.7% YoY to $7-7.5 billion. Although there was a moderation to a still commendable 16% growth in FY23, the current fiscal year, FY24, reflects a noticeable lack of confidence among advertisers regarding the anticipated returns.

So, what factors might be contributing to the cautious outlook for advertisers in the current fiscal year?

According to Redseer’s report titled ‘Breaking barriers: Rise of challenger platforms in the digital advertising landscape,’ the anticipated restrained single-digit growth in India’s ad spending for FY24 is primarily attributed to the decline in consumer spending witnessed over the last five to six quarters.

Additionally, the hefty 28% Goods and Services Tax (GST) imposed on India’s online gaming companies has compelled them to implement cost-cutting measures, including reductions in advertising budgets. This uncertainty, coupled with a potential decline in gaming revenue, poses the risk of diminishing the overall advertising expenditure within the sector.

India’s Digital Advertising Market Growth

In India’s dynamic digital advertising market, the share of digital giants, encompassing digital ad platforms within the Alphabet and Meta ecosystems, is projected to reach its lowest point at 60% in FY24. The two other significant players, retail media and content-based platforms, have been eating the market share of digital giants, particularly from the last two fiscal years.

Despite the declining market share, the overall value of digital giants is on an upward trajectory, reflecting the expanding size of the total digital advertising market. In FY24, the ad spending on digital platforms owned by Alphabet and Meta is expected to approach $5-6 billion, illustrating sustained growth, even as their share diminishes to 60%. This contrasts with the figures from FY22 and FY23, where their spending was $5 billion, accompanied by a market share of 67% and 62%, respectively.

Advertisers in India are increasingly reallocating their budgets towards challenger platforms like Retail Media and Content-based platforms, leveraging their niche offerings. Retail Media platforms such as eTailing and Hyperlocal are projected to experience growth in digital advertising market share, increasing from ~15% in FY22 and ~18% in FY23 to ~20% in FY24.

On the other hand, Content-based platforms are anticipated to maintain their consistent ~20% market share in FY24, consistent with FY23, with growth propelled by the popularity of Shortform Video and OTT Video.

The shift in advertisers’ spending strategies is driven by several crucial factors. One key element involves the capability to precisely target users demonstrating strong intent. Moreover, advertisers are keen on broadening their reach to Tier-2 audiences, and capitalize on the extended attention span observed on these platforms, indicating a higher probability of user engagement.

In a Nutshell

Over the next 3-4 years, a favourable shift in advertisers’ perception toward Digital Advertising is anticipated, indicating a notable uptick in advertising expenditures across diverse sectors.

In the Banking, Financial Services, and Insurance (BFSI) sector, there’s a projected increase in advertising spending over the next 3 to 4 years, aiming at accelerating the adoption of advanced financial tools. Simultaneously, the healthcare industry is channelling investments into digital advertising to expedite the promotion of preventive healthcare solutions, aligning with the industry’s evolving focus on proactive health measures.

In the Consumer Packaged Goods (CPG) & Retail sector, key players are strategically leveraging digital advertising to showcase and promote their Direct-to-Consumer (D2C) platforms. This approach reflects a forward-looking strategy to directly engage consumers and enhance the overall retail experience.

In the evolving landscape of India’s digital advertising, what strategies do you believe will be most effective for advertisers to navigate the challenges and capitalize on emerging opportunities in the coming years?

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Customer Frustration Rising at Paytm Payments Bank: 150x YoY Surge in Complaints

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Paytm Payments Bank complaints

User complaints can have severe repercussions for any B2C business, particularly operating in the fintech sector where daily financial transactions are the norm. Paytm Payments Bank, owned by One97 Communications, has reportedly witnessed a massive surge in customer complaints during fiscal 2023, ending March 31, 2023. It’s important to highlight that these complaints surfaced well before the payment bank became subject to stringent regulatory measures by the Reserve Bank of India (RBI).

In the fiscal year 2023, Paytm Payments Bank reported a staggering 66,751 complaints across various categories, marking an alarming 150.1% YoY increase compared to fiscal 2022, where the reported complaints numbered 26,692.

The upsurge in complaints from Paytm Payments Bank’s customers became notably pronounced in fiscal 2021, witnessing an 80.9% YoY increase to reach a total of 25,988. This surge can be attributed to the impact of the Covid-19 pandemic during that period, prompting a sudden uptick in people using Paytm Payments Bank for online transactions. This abrupt surge in activity may have strained the company’s capacity, particularly as employees were working remotely. However, the subsequent fiscal year, FY22, saw a relatively modest 2.7% YoY increase in complaints.

It’s noteworthy that a majority of the complaints registered by Paytm Payments Bank were user-generated, and the bank typically resolved them within a responsive timeframe of five to six days.

Surge in Mobile Banking and Wallet Complaints

A closer look at the data reveals that over 58% of the complaints registered by Paytm Payments Bank in FY23 were related to Internet and mobile banking issues. This specific category amassed a total of 39,000 complaints, standing out as the highest among all the reported categories. Following closely were 8,974 complaints related to account opening and operational challenges. This upsurge in complaints is closely aligned with the broader context of operational challenges faced by Paytm Payments Bank in FY23.

Surprisingly, there was an eye-popping 300% YoY jump in mobile banking complaints in FY23, followed by 94% YoY growth in wallet-related complaints. The number of issues with accessing the Paytm Payments Bank accounts shot up over 700% YoY.

In March 2022, the Reserve Bank of India barred Paytm Payments Bank from onboarding new customers, citing “certain material supervisory concerns observed in the bank.” It is conceivable that this regulatory action may have contributed to customer difficulties in accessing accounts and opening new ones during fiscal 2023, starting from April 2022. The correlation between these events underscores the intricate dynamics between regulatory interventions, operational hurdles, and customer grievances for Paytm Payments Bank during this timeframe.

“This was the year when the bank was put under an embargo by the RBI, which could have caused a lot of problems for customers looking to open accounts or trying to access existing accounts,” said an industry insider in the know.

Airtel Payments Bank, a close rival to Paytm, reported a total of 445 complaints during FY23, with 95 of them specifically related to loading mobile wallets with cash. It’s important to note that Airtel Payments Bank, with approximately 72.5 million wallets, is considerably smaller in scale compared to Paytm Payments Bank, which boasted around 630 million wallets as of the end of January 2024.

In an effort to address all challenges faced by Paytm Payments Bank over the last two years, the founder, Vijay Shekhar Sharma, has made the decision to step down from the board. This strategic move is aimed at paving the way for a new board at PPBL, with the optimistic expectation that it will help alleviate tensions with the RBI and contribute to fostering a more positive image for the payments bank.

Additionally, the fintech company has forged partnerships with third-party banks, including Axis Bank, HDFC Bank, State Bank of India, and Yes Bank, to sustain its services following the impending ban, effective after March 15, 2024. It will be intriguing to observe how these decisions impact the future trajectory and reputation of Paytm Payments Bank in India’s fastest-evolving fintech sector.

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Number of Internet Users in India Exceeds 800 Million: Rural India Dominates in Key Online Activities

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Number of Internet Users in India Rural vs Urban

India has experienced a remarkable surge in the widespread adoption and usage of the Internet over the past five years. This surge, with an impressive penetration rate exceeding 55%, can be largely attributed to telecom companies like Airtel and Jio, who extended the reach of 4G and subsequently introduced 5G, even in rural areas. Interestingly, the number of active Internet users in India have surpassed the 800 million mark by the end of 2023. According to the “Internet in India 2023” report by IAMAI and Kantar, approximately 53.8%, equivalent to 442 million users, hailed from Rural India.

In the digital landscape of 2023, one activity stood out prominently among all the activities Indians do on the internet – Over the Top (OTT) content consumption. A whopping 86.1% of Internet users in India, totalling 707 million people, were actively indulged in enjoying OTT content in both audio and video formats in 2023.

Other online activities include social media browsing, communication, online gaming, digital payments, and more.

It is important to note that communication, which encompasses text/voice/video chat or used email, video conferencing, etc., emerged as the second most engaged activity on the Internet in 2023. An impressive 76% of Internet users in India participated in these communication activities in 2023, totalling 621 million individuals.

Moreover, over 70% of Indian Internet users were actively involved in social media, culminating in a total of 575 million by the end of 2023.

Internet Usage in Rural India Surpassing Urban

What’s remarkable is how rural India surpassed the top 9 cities (Delhi, Mumbai, Chennai, Kolkata, Surat, Bangalore, Ahmedabad, Hyderabad, and Pune) in terms of top Internet activities in 2023.

A striking 53% of the OTT users (audio and video content) in India were from Rural India, a noteworthy contrast to the mere 15% from the top 9 cities. Similarly, over 50% of users engaged in communication, social media, and online gaming activities hailed from rural areas, contrasting with just 16% from the top 9 cities.

An exception was observed in online learning, where only 20% of the Internet users were from rural regions in 2023, while 40% were from the top 9 cities. The overall count of online learning users in India reached 24 million in 2023. These findings are not surprising, given that popular online learning platforms such as Upgrad, Unacademy, Coursera, etc., are primarily used by students and working professionals, especially in IT companies. These individuals residing in urban areas are often more focused on advancing their careers through educational opportunities.

In contrast, the lower participation in online learning among rural Indians may be attributed to a preference for leisure activities like gaming and social media browsing rather than educational pursuits. This highlights a notable distinction in the internet usage patterns between urban and rural populations, reflecting varying priorities and interests.

Internet on Shared Devices Increased

A noteworthy finding from the “Internet in India 2023” report was the increasing use of shared devices for internet access. In 2021, only 8% of internet users in India accessed the internet through someone else’s mobile device. However, by the end of 2023, the percentage has surged to 18%. What makes this trend even more intriguing is that a majority of these shared device users to access the Internet in the country, comprising 77%, were females. Additionally, 43% of these users were above the age of 35, and a substantial 63% hailed from rural areas.

Despite the growing digital landscape, a significant 45% of the Indian population, equivalent to 665 million individuals, still does not access the internet. A staggering 79 of them are from Rural India, totalling 526 million. However, there is a slow but steady decline in the share of non-active internet users in India, with a modest growth rate of 3-4 percentage points over the last two years.

Several reasons contribute to the non-adoption of the Internet in India. Some of the prominent factors include finding it too difficult to understand and use (23%), lack of awareness about the benefits of the internet (22%), a disinterest in accessing the internet (22%), restrictions on internet access (21%), and the inability to afford an internet connection or perceiving it as expensive (17%), among other key barriers. These insights underscore the existing challenges in bridging the digital divide and highlight the multifaceted barriers hindering internet adoption in India.

Examining the Internet penetration across states in India, Goa leads the charge with 73%, followed by Maharashtra and Kerala at 69%. In contrast, the top three states with the lowest percentage of people using the Internet include Jharkhand (46%), Uttar Pradesh (41%), and Bihar (37%). The data highlights the need for targeted efforts to enhance digital connectivity and access in areas with lower penetration.

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Will Vijay Shekhar Sharma’s Exit From Paytm Payments Bank Ease Tensions with the RBI?

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VSS Resigned From Paytm Payments Bank Board

One97 Communications Ltd (OCL), the parent company overseeing all Paytm entities, has officially disclosed a restructuring plan for the Paytm Payments Bank (PPBL) Board. This strategic move involves the departure of the visionary founder, Vijay Shekhar Sharma, from his position as part-time non-executive chairman and board member at PPBL. One97 Communications has also taken the significant step of withdrawing all nominees from the board of Paytm Payments Bank.

The stock market swiftly reacted to this noteworthy development, with Paytm shares gaining over 1% at 9:15 am on February 27, 2024, trading at Rs 419.10.

The recent restructuring of the Paytm Payments Bank board seems to be a crucial and much-needed decision by the company, particularly in light of the regulatory actions taken by the Reserve Bank of India (RBI). The ban imposed on its payment bank on January 31 has had a profound impact, with Paytm stock experiencing a significant decline of 44% in its market value. Recognizing the urgency and gravity of the situation, the company has taken proactive measures to realign its payment bank board.

The restructuring at PPBL is not just a response to the immediate crisis but a forward-looking move to fortify the company’s resilience and strategic position in India’s fintech sector.

“OCL supports PPBL’s move of opting for a board with only independent and executive directors by removing its nominee. The Company has been separately informed that Vijay Shekhar Sharma has also resigned from the Board of Paytm Payments Bank to enable this transition,” according to the stock exchange filing.

On the One 97 Communications side, the payments bank board comprised notable figures such as Dr. Srinivas Yanamandra, the group head of regulatory affairs, and Bhavesh Gupta, serving as the chief operating officer and president.

The newly formed board of PPBL includes distinguished individuals such as Srinivasan Sridhar, former chairman of the Central Bank of India, along with retired IAS officers Debendranath Sarangi and Rajni Sekhri Sibal. Additionally, Ashok Kumar Garg, a former executive director of Bank of Baroda, brings his wealth of experience to the reconstituted board.

The reshaping of the board structure comes in response to the RBI’s recent actions against PPBL and the concurrent resignations of two independent directors, Manju Agarwal and Shinjini Kumar, from its board. However, Shinjini Kumar resigned in December 2023, pre-dating the RBI order issued on January 31, 2024.

A Strategic Move or a Last-Ditch Effort?

The recent decision by Vijay Shekhar Sharma to step down from the board of Paytm Payments Bank has sparked speculation and debate within the financial community.

Media reports suggest that Vijay Shekhar Sharma’s resignation is part of a broader strategy for the fintech company’s future growth. It is suggested that Sharma had considered stepping down from the payments bank board as early as last year, and discussions even included the possibility of rebranding by removing the name “Paytm” to address mounting regulatory and compliance pressures.

According to global broking firm Macquarie, Sharma’s recent actions convey a message to regulators that he is open to giving up control of Paytm Payments Bank.

Market veteran Sanjiv Bhasin sees Sharma’s recent decisions as a positive and strategic shift, interpreting them as the release of ego for a bigger goal. Bhasin believes that this move, from a broader perspective, is the right step, and he anticipates that the new management will contribute to a better image for the payments bank.

Despite the immediate challenges faced by PPBL, Bhasin remains optimistic about the long-term story of Paytm, expressing confidence as an investor.

Some industry analysts see the resignation of Vijay Shekhar Sharma as a forced exit due to mounting pressure from the RBI, potentially avoiding harsher regulatory actions against the company and himself.

Now, it would be interesting to see will Vijay Shekhar Sharma’s resignation from the board of Paytm Payment Bank emerge as a game-changer for the fintech company or reflect as a desperate move in the face of mounting challenges. What are your thoughts on this? Let us know in the comment section below!

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PE Investments in India Plunged Over 30% YoY in 2023: Investors Bet Big on Growth and Late-Stage Ventures

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India PE Investments 2023 startup Funding

In 2023, Indian enterprises and startups encountered significant challenges in terms of investments and strategic business expansion, as revealed in PWC India’s latest report titled “Deals at a Glance.” The report paints a stark picture of a substantial decline in both deal volume and value for private equity (PE) and mergers and acquisitions (M&A) deals throughout the year. Notably, startups experienced a challenging period, marking the lowest fundraising figures in the past five years.

The combined value of deals, encompassing both PE and M&A, declined a significant 23% YoY in CY 2023 to 1850. Simultaneously, the total value of these deals plummeted a massive 37.6% YoY to $75.2 billion during last year.

In particular, M&A deals totalled 793 in volume in 2023, with a drop of 9.8% YoY. However, the more striking aspect lies in the substantial decline in the total value of these M&A deals, which plummeted by a massive 39.3% YoY, amounting to $38.8 billion for the year.

The state of Private Equity (PE) investments in Indian companies in 2023 is even more concerning, with a notable decline of 30.6% YoY in deal volume and a strong 35.6% YoY drop in value. This translated to 1,057 PE deals with a cumulative value of $36.5 billion during the same period.

Despite the overall contraction in the investment landscape, a notable shift occurred between 2022 and 2023 – the average investment size per deal increased from $42 million to $46 million. This suggests a potential strategic shift towards pursuing larger and more impactful opportunities within the Indian market.

Early-Stage Woes, But Buyouts Show Resilience

The early-stage investments in Indian companies witnessed a significant 53% YoY decline in CY23. However, despite this reduction, both early-stage and growth-stage investments combined continued to dominate, accounting for a significant 73% of the total funding during the year.

Surprisingly, buyouts demonstrated resilience with only a 5% decline in CY23 compared to CY22, indicating a heightened level of investor activity in acquiring well-established companies. This trend implies a strategic shift towards more mature and proven ventures, reflecting investor confidence in such entities.

Top Sectors

  • India’s retail and consumer sector took the lead as the champion in both deal volume and value, boasting 289 deals with a total value of $8.8 million in 2023.
  • The technology sector secured the second position with 269 deals in volume and a total value of $4.6 million last year.
  • Notably, the financial services, renewable power, and healthcare sectors, although ranking 7th, 8th, and 5th in terms of deal volume, emerged as the 2nd, 3rd, and 4th in terms of deal value, respectively.
  • In 2023, companies in India’s fintech sector clinched 130 deals with a combined value of $2.9 million, underscoring the sector’s robust performance and significant investment activity.

Indian Startup Funding: A 5-Year Low

In 2023, the Indian startup ecosystem grappled with a significant funding downturn attributed to global economic uncertainties and the looming threat of recession. These challenges triggered extensive restructuring efforts and widespread layoffs within the industry. Surprisingly, the funding raised by Indian startups declined 68% YoY to just $8 billion in 2023, the lowest in the last 5 years. The average ticket size for these fundings was $13 million.

The top five sectors attracting substantial investments were SaaS, D2C, LogiTech and AutoTech, FinTech, and e-commerce B2B.

Despite the overall funding challenges faced by Indian startups in 2023, what adds an intriguing dimension is the dominance of growth and late-stage deals. Together, these categories accounted for approximately 85% of the total funding secured last year. Interestingly, the average ticket sizes were around $21 million for growth-stage and $47 million for late-stage deals. This suggests a clear investor inclination towards supporting more established and mature startups, signalling a strategic move away from early-stage ventures. This strategic move could be attributed to a cautious approach aimed at mitigating risks and ensuring a focus on ventures with proven track records and potential for significant impact.

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The Rise of Crypto Integration in Casino Platforms

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bitcoin in gaming

Online gambling is almost unrecognizable from 10 years ago, and much of it has to do with the astronomic rate of crypto integration into the industry. Cryptocurrency casinos, once on the fringes, have now become one of the most dominant forces in gambling, which has led to a lot of positive reshaping.

One extensive study projected the global crypto gambling market to reach an astounding $92.4 billion by 2023. This forecast signaled an unprecedented compound annual growth rate (CAGR) of 71.9% from 2022 to 2023, underscoring the continued growth in the popularity of cryptocurrency usage within online casinos. What’s driving this growth is the rapid adoption of cryptocurrencies among online gamblers.

We’re going to take a look at the rise of crypto casinos, honing in on the key statistics and trends that allow us to understand the profound impact of digital currencies on the gambling industry.

The Global Crypto Gambling Market

In the realm of Bitcoin casinos worldwide, North America leads with a commanding 35.7% of all visitors, closely followed by South America at 30%. Surprisingly, Europe lags behind at 12%, despite its advanced regulatory framework and higher cryptocurrency adoption rates, trailing significantly behind Asia’s 16.6%. Meanwhile, Africa and Oceania have smaller user bases, accounting for 5.25% and 0.67% respectively.

The findings of a 2022 report revealed that almost a third of gamblers worldwide have used cryptocurrencies for their online betting activities at least once, and since then, the industry has witnessed an even bigger increase in the number of cryptocurrency-specific online casinos out there. The market has seen the emergence of literally hundreds of new platforms, which offer players a huge array of options for their gambling pursuits (so even the pickiest player is well catered for). 

Advantages of Cryptocurrency for Online Casino Players

So, by now we know that crypto casinos are proving extremely popular, but what’s in it for the host of players using them, in particular? Here are just a few benefits of using cryptocurrency for online casino players.

Firstly, there’s the anonymity and privacy that crypto provides that, quite frankly, traditional payment methods just can’t match. Ethereum or Bitcoin gambling, for example, allows players to enjoy a discreet online gambling experience without having to part with their personal information. Then there’s security and fraud prevention. The blockchain technology underpinning cryptos ensures a highly secure and transparent transaction environment. This significantly diminishes the risk of fraud and helps to foster player confidence in online gambling because they won’t be required to part with their financial information.

Furthermore, with cryptocurrency, transactions are faster. are characterized by their speed, so gamblers can deposit and withdraw funds much more quickly than they could when they were using traditional banking methods. This efficiency enhances the overall gaming experience, eliminating the delays often associated with conventional payment systems. Operating on a decentralized network, cryptocurrencies allow anyone from across the world to participate in online gambling without geographical restrictions. 

Advantages of Cryptocurrency for Online Casinos

Online casinos also receive a wealth of benefits from using crypto. Cryptocurrency transactions typically involve lower fees compared to traditional banking methods. This cost-effectiveness benefits online casino operators by reducing overhead costs associated with payment processing. And, by embracing crypto, online casinos can tap into a broader market of tech-savvy players who prefer digital currencies. This expanded customer base can contribute to the sustained growth and success of crypto casinos. On top of this, the use of blockchain technology not only ensures the security of player transactions but also builds trust between online casinos and their users. The transparent and immutable nature of the blockchain adds an extra layer of credibility to the gaming ecosystem.

Challenges for Cryptocurrency and Online Casinos

As we’ve seen, cryptocurrency usage has many an advantage for both the house and the gambler, but it still faces challenges. Probably the biggest of these challenges is the volatility of cryptocurrency values. The unpredictable nature of these digital assets poses a challenge for both players and operators because understanding the precise value of their funds at any one time becomes a pretty complex task. 

The security of cryptocurrency transactions is also an important consideration. Despite the advanced security features of blockchain technology, the possibility of hacking and other security breaches is real. After all, no one can say with 100% certainty that there is zero risk of someone’s personal finances being tampered with, for example. Therefore, it’s really important for online casinos to proactively implement robust security measures to safeguard players’ funds and personal information. This involves the utilization of secure wallets, encryption, and other cybersecurity protocols to fortify defenses against potential threats. However, crypto is deemed by many industry experts to still be a far safer solution to those traditional methods of paying in and withdrawing money.

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Airtel Outperforms Jio with 3 Million Growth in Active Mobile Subscribers in December 2023; 12.44 Million Seek New Connections

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India telecom Jio vs Airtel 2023

India’s telecom sector has dramatically changed over the past decade, with new players eating the market share of established telecom companies. A particularly noteworthy development in this transformation is the profound impact of Reliance Jio’s entry, leading to an impressive adoption rate of telecom services among the Indian population, surpassing 83%. Therefore, the growth of telephone subscribers in India has stagnated. The number of telephone subscribers in India increased a negligible 0.39% MoM and 1.70% YoY, reaching a total of 1.19 billion by the end of December 2023. Over 97% of these were wireless telephone subscribers, according to the latest data by TRAI.

The number of mobile phone subscribers in India reached 1.16 billion by the end of December 2023, with a marginal increase of 0.37% MoM and 1.36% YoY. This negligible growth suggests that a majority of Indians, be it in rural or urban areas, now have a mobile connection. The growth of wireless/mobile phone subscribers in both rural (1.78% YoY) and urban (1.02% YoY) areas has stagnated in 2023.

India’s top three five mobile telephone service providers as of December 31, 2023 were Reliance Jio Infocomm Ltd with 459.81 million subscribers, Bharti Airtel with 381.73 million, and Vodafone Idea with 223.05 million subscribers.

Predictably, Mukesh Ambani-led Reliance Jio experienced the most substantial subscriber growth, adding an impressive 3.99 million mobile subscribers in the last month and 35.30 million in the 12 months ended December 31, 2023.

Bharti Airtel maintained its position as the second-largest telecom provider in India, acquiring 1.85 million in the last month and 14.12 million in the last 12 months during the period ending December 31, 2023. In contrast, Vodafone Idea faced challenges as it consistently lost subscribers to the top two telecom service providers. In the entire 2023, VI lost 18.28 million wireless subscribers in India.

Active Wireless Subscribers: Airtel’s Surge and Jio’s Dominance

Even though Reliance Jio has added more wireless telephone subscribers than Airtel, the latter gained more active subscribers. Specifically, in December 2023, Airtel experienced a noteworthy addition of 3 million active subscribers, surpassing Jio’s addition of only 1.21 million active subscribers.

Zooming out to analyze the broader picture, Jio emerged victorious in the annual addition of active wireless subscribers in India. Jio added an impressive 33.54 million new active mobile subscribers, bringing the total count to 424.51 million by the end of December 2023. On the other hand, Airtel added 12.56 million new active wireless subscribers, resulting in a total count of 377.54 million at the year-end.

On the contrary, Vi faced significant challenges, losing 1.84 million active users in just one month and a substantial 12.9 million in the 12 months ending December 31, 2023. This brought Vi’s total active users to 196.68 million at the end of the year.

Out of the total 1,158.49 million wireless subscribers, a whopping 90.5% or 1,047.88 million wireless subscribers were active on the date of peak Visitor Location Register (VLR) in December 2023. In simpler words, approximately 91% of the mobile subscribers in India were actively using their mobile services at the specified time.

Bharti Airtel boasted the maximum proportion, with 98.90% of its active wireless subscribers in comparison to its total wireless subscribers on the date of peak VLR in December 2023. In contrast, Jio had a slightly lower percentage at 92.32%, while Vi showcased 88.18% of its total mobile subscribers actively engaged. This comprehensive analysis provides insights into the robust user engagement levels among various telecom providers in India.

Other Key Highlights:

  • The number of broadband subscribers in India reached 904.54 million in 2023. Although the monthly growth rate remained minimal at 0.88% in December 2023, the yearly growth was 8.69% in 2023.
  • As of December 2023, the top five broadband service providers in India were Reliance Jio Infocomm Ltd with 470.19 million subscribers, Bharti Airtel with 264.76 million, Vodafone Idea with 127.29 million, BSNL with 25.12 million and Atria Convergence with 2.23 million subscribers.
  • As of December 31, 2023, India’s top five mobile broadband service providers were Reliance Jio Infocom Ltd with 459.81 million subscribers, followed by Bharti Airtel with 257.37 million, Vodafone Idea with 127.28 million, BSNL with 21.28 million and Intech Online Pvt. Ltd. with 0.24 million subscribers.

In December 2023, Mobile Number Portability (MNP), providing users with the flexibility to switch from one telecom operator to another, registered a total of 12.44 million requests in India. It is expected that a significant number of these requests could be from Vodafone Idea users opting to switch to either Reliance Jio or Aitel connections. This decision might be influenced by factors such as improved network availability and faster 5G download speeds offered by India’s top two telecom operators.

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ED Tightens the Noose Around Byju’s Founder: Puts His Travel Plans Under Lens

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byju Raveendran

Byju’s, already grappling with financial challenges, now faces an additional obstacle as its founder, Byju Raveendran, comes under suspicion of contemplating an exit from India. Citing sources, the Economic Times reported that the Enforcement Directorate (ED) has prompted the Bureau of Immigration (BOI) to issue a lookout circular (LOC) against Raveendran. This development aligns with the ongoing investigation by the ED’s Bengaluru office into potential Foreign Exchange Management Act (FEMA) violations involving both the edtech startup and its founder.

For those unfamiliar with the concept, the LOC ‘on intimation’ permits immigration authorities to notify a probe agency about an individual’s overseas travel without hindering their departure.

Recently, a group of shareholders at Byjy’s has called for an Extraordinary General Meeting (EGM) scheduled for February 23, 2024. There is uncertainty surrounding whether CEO Raveendran is deliberately avoiding participation in this meeting, or if there are other factors at play that remain undisclosed.

It is important to note that the LOC ‘on intimation’ was previously issued against Raveendran over eighteen months ago at the behest of the ED’s Kochi office. However, with the subsequent transfer of the investigation to the Bengaluru office, the necessity for an updated LOC has come to the forefront.

Over the past three years, Raveendran has been a frequent traveller, shuttling between Delhi and Dubai. Despite recent reports indicating his presence in Bengaluru earlier this week, Raveendran clarified to ET that he is presently in Dubai and intends to embark on a journey to Singapore tomorrow. This travel pattern adds another layer of complexity to the ongoing situation, raising questions about the founder’s whereabouts and potential implications for the investigation.

Underlining the significance of the Lookout Circular, a senior government official emphasized that its issuance, even with Raveendran currently overseas, serves as a preventive measure to obstruct his departure upon return. This precautionary measure is designed to protect the interests of Byju’s investors and ensure a seamless resolution to the case.

ED Previous Allegations Against Byju’s

The challenges for Byju and its founder began unfolding in April 2023 when the Enforcement Directorate (ED) conducted raids on two business premises and a residential property in Bengaluru.

The ED, through a press note, disclosed that Byju’s had received an estimated Rs 28,000 crore (Approx $3.4 billion as per today’s rate) in foreign direct investments between 2011 and 2023. Additionally, it was revealed that the company had sent approximately Rs 9,754 crores (US$1.22 billion) to foreign entities under the overseas direct investment scheme during the same period.

In response to these findings, the ED issued show-cause notices in November 2023 to Byju’s parent, Think & Learn, and Raveendran. The notices were related to alleged violations amounting to ₹9,362.35 crore under FEMA.

Against the backdrop of controversies and financial challenges, Byju’s has faced a considerable decline in its valuation over the past two years by its two major investors, Prosus and BlackRock. Prosus slashed Byju’s valuation from $22 billion in early January 2022 to less than $3 billion by November 2023. The downward trend continues as BlackRock devalues Byju’s, bringing its valuation to under $1 billion in January 2024.

In a Nutshell

Byju’s financial troubles, coupled with the ongoing ED investigations and the issuance of a lookout circular against Raveendran, create a perfect storm that could threaten the edtech company’s future.

Byju’s has vacated many of its major office properties due to non-payment issues in the last 12 months. Investors are increasingly vocal in their call for a change in leadership. The demand for the ouster of the current board, comprising Raveendran, his wife and co-founder Divya Gokulnath, and his brother Riju Raveendran, reflects the growing concern and dissatisfaction among stakeholders.

It is now evident that Byju’s cannot reclaim its status as India’s edtech giant under the current leadership of CEO Raveendran, as both employees and investors have lost confidence in his ability to steer the company effectively.

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Amazon Bets Big on Unbranded Bazaar in India: Aggressive Price Strategy to Conquer Tier II and III Cities?

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Amazon Bazaar Shopping platform

Indians consistently prioritize price over brand recognition, and Amazon seems to have realised this trend. The e-commerce giant is strategically betting on its soon-to-be-launched low-price shopping platform, “Bazaar”, aiming to woo value-conscious customers across tier II, III and IV cities in India. Amazon Bazaar will reportedly offer an array of unbranded fashion and lifestyle products, encompassing categories like apparel, watches, shoes, jewellery and luggage, all competitively priced below Rs 600.

What’s more interesting is that Amazon Bazaar isn’t just aiming to entice budget-conscious shoppers; It’s also extending a warm welcome to sellers.

The operational phase of the Bazaar as a marketplace has commenced, with Amazon actively onboarding sellers and encouraging them to list unbranded products. These insights were revealed by ET, which meticulously reviewed the company’s communications with merchants.

Amazon’s foray into affordable, unbranded fashion and lifestyle products seems like a well-calculated response to the shifting dynamics of the Indian consumer market. The decision is primarily attributed to the declining demand for mass-market products, leading to a slowdown in Amazon’s growth trajectory within India. The surge in Indians opting for premium products, fueled by substantial discounts and bank offers, has further influenced this strategic move.

Currently, India’s online mass-market fashion segment has seen successful penetration by SoftBank-backed Meesho. Another major player in the space is Walmart-owned Flipkart Shopsy, operating through a separate app. Adding to the competitive landscape, Mukesh Ambani-led Reliance Industries is also actively working on a low-price platform, Ajio Street.

What’s In It For Sellers?

For sellers, Amazon Bazaar presents an enticing proposition. Amazon is putting forward a zero-referral fee for merchants, a critical incentive, particularly for products with a low average selling price (ASP). In addition, the company has removed closing fees for merchants using its Easy Ship service to sell on the Amazon Bazaar platform.

By eliminating referral fees and easing closing fees, Amazon creates an enticing environment for merchants who might have found the traditional commission structure a tad daunting. This opens the door for smaller players and unbranded goods, promising a treasure trove of diverse products for the price-savvy crowd.

“Bazaar is a new store on Amazon where you can sell your fashion and lifestyle products online at no extra charges, thus making it more profitable to run your business,” a document from Amazon to sellers said.

Affordability Over Immediacy

The delivery timelines for products on the Amazon Bazaar platform are anticipated to be approximately 2-3 days. This deliberate decision reflects a calculated move by Amazon, placing a higher emphasis on affordability over immediacy.

Understanding the mindset of the value-conscious consumer, Amazon acknowledges that a slightly prolonged wait of a few days is a minor compromise for the significant savings offered on the Bazaar platform. Therefore, the company’s focus on affordability aligns seamlessly with the preferences and priorities of its target audience, serving as a crucial element in its strategy within the competitive market.

Amazon Facing Competition From Local Players

Meesho, a significant player in India’s online marketplace, operates on a zero commission model with an average selling price (ASP) ranging between Rs 300-350. Its revenue model relies on advertising and logistics services to sellers, distinguishing it from Amazon and Flipkart, which manage their own warehouses and logistics.

Satish Meena, an independent e-commerce analyst and advisor at Datum Intelligence, notes that Meesho has effectively captured market share from Amazon, particularly in segments such as fashion and homecare. To compete in low ASP segments, Amazon must provide products akin to those offered by Meesho to both merchants and consumers. The analyst further observes that even Amazon Fashion in India has not replicated the success of Myntra, indicating challenges in finding the right approach for this market.

Therefore, the impending launch of the Bazaar marketplace is viewed as yet another effort by Amazon India to establish a stronger presence in the fashion segment and ultimately acquire new customers in India.

In January 2024, Amazon.com, Inc. infused Rs 830 crore (approximately $100 million) into its India entity, Amazon Seller Services. This strategic investment aligns with the company’s efforts to revitalize its growth in India, particularly in the wake of challenges posed by local players in the value-conscious segments.

The question remains: Will Amazon Bazaar weave its magic and emerge as the price whisperer of the Indian e-commerce market? Only time will tell, but the potential for transformative impact is undeniable. In smaller cities, it could evolve into a digital bazaar, brimming with affordable finds. The intensified competition in this segment could spark price wars, ultimately showering consumers with even more enticing deals. Let us know your thoughts in the comment section below!

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Byju’s May Have to Shutter All Major Offices Across India: Defaults on Rent, Receives Multiple Legal Notices

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Byju vacating offices

Byju’s has been grappling with a financial storm for quite some time, prompting it to take significant measures to weather the challenges. In the latest move, the edtech firm has downsized its office space in Bengaluru as part of ongoing cost-cutting measures. Byju’s has recently vacated an expansive 400,000 sq ft property at Prestige Tech Park, citing rental disputes and persistent challenges involving other landlords.

The recent reduction in office space follows a similar move between 2022 and 2023 when Byju’s vacated its largest office space, a 558,000 sq ft property in Kalyani Tech Park, 70,000 sq ft property in IBC Knowledge Park, along with relinquishing two out of nine floors in Prestige Tech Park.

The financial strain on Byju’s is particularly evident in its termination of the lease agreement for the Prestige Tech Park office space, where the company was paying a monthly rental of approximately Rs 4 crore. The termination, confirmed by Juggy Marwaha, CEO of Prestige Office Ventures, occurred in January this year, with the deposit adjusted against rent defaults.

“We tried our best to realign rents and give them some relaxation. When rental payments still didn’t come on time, we had no choice but to adjust the security deposit and request that they release the space back to us, which we settled amicably,” Juggy Marwaha, CEO of Prestige Office Ventures, said.

Additionally, Byju’s is currently facing legal action from Kalyani Developers for defaulting on rental payments for a substantial 500,000 sq ft office space situated at Kalyani Tech Park in Bengaluru. This lease agreement includes a lock-in period extending until March 2025.

An informed source detailed that Byju’s outstanding amount to Kalyani Developers totals ten months’ rent, with seven months’ worth being adjusted against the deposit. Despite attempts to obtain a response from Byju’s through email, the company has not provided any feedback as of the press time. Adding to the complexity of the situation, even though Byju’s retains ownership of the assets associated with the property, there is currently no operational activity taking place at this location.

Does this suggest that Byju’s is on the verge of shutting down all its major offices across India, resulting in a permanent shift to remote work for all its employees? Quite likely!

Byju’s had a total of 17,422 employees in October 2023.

Raveendran Under Fire

However, the troubles for Byju’s don’t end there. Investors, once brimming with enthusiasm, are now voicing their dissent. Reports of mismanagement and financial distress have fueled calls for the ouster of CEO Byju Raveendranand, and restructuring of the board. This discontent arises even after the company recently secured commitments worth $300 million from investors for its $200 million rights issue.

A group of shareholders at Byjy’s has initiated a call for an Extraordinary General Meeting (EGM) scheduled for February 23, 2024. The primary objectives of this meeting are to address governance issues and advocate for changes at the executive level. It is noteworthy that the shareholders advocating for these changes collectively command a significant stake in the company.

Byju’s downsizing spree isn’t just about shrinking office space; it’s a stark symbol of a once-dominant edtech giant grappling with an existential crisis. Although the company is leaving no stone unturned to weather this financial storm through cost-cutting and investor appeasement, the question remains: can Byju’s rise again from the ashes?

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India Smartwatch Shipments Grew 74% YoY in 2023: A 3-Year-Old Brand Enters Top Five, Outpacing Samsung!

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India Smartwatch Shipments 2023

Smartwatches are selling like hotcakes. The adoption and usage of smartwatches in India have skyrocketed since the COVID-19 pandemic as people became more health conscious. According to IDC’s latest report, the smartwatch shipments in India grew a whopping 73.7% YoY in CY 2023 to 53.4 million units. Notably, smartwatches accounted for 39.8% share of the total wearable devices shipped in the country last year.

The surge in demand for smartwatches in India is primarily attributed to affordability during the festive season sales, heavy discounts, and a diverse range of options available in the market.

However, the growing popularity of non-branded watches has impacted the overall demand for high-end smartwatches from established players. These non-branded smartwatch vendors are strategically targeting first-time users by offering cheap alternatives to popular models, often bundled with multiple watch straps. As a result, the share of advanced smartwatches shrank from 4.5% in 2022 to 2.1% in 2023, resulting in the shipment of 1.1 million units. These factors collectively contributed to a strong 38.7% YoY drop in the Average Selling Price (ASP) of smartwatches in India, falling from US$42.5 in 2022 to US$26.1 in 2023.

Looking at the bigger perspective, the shipments of wearable devices in India grew an impressive 34% YoY to a record 134.2 million units. Despite numerous new launches, promotional offers, and discounts during the holiday season, the average selling price (ASP) of overall wearables declined a notable 15.4% YoY to US$21.2 in Q4 2023.

Key Highlights: Top Smartwatch Brands in India

  • Fire – Boltt emerged as India’s top smartwatch brand in 2023, surpassing Noise (Nexxbase). The brand recorded a strong 70% YoY growth in its smartwatch shipments last year. Despite this substantial growth, the shipment share of Fire-Boltt declined from 24.8% in 2022 to 24.3% in 2023.
  • Noise (Nexxbase) slipped to the second spot in the list of India’s top five smartwatch brands in 2023. Despite achieving an impressive 41.3% oY growth in smartwatch shipments last year, the brand witnessed a notable decline in its market share, dropping from 27.2% in 2022 to 22.1% in 2023.
  • boAt (Imagine Marketing) has consistently lost its smartwatch market share to competitors. In 2021, boAt held a 25.1% share of India’s smartwatch market, which declined to 18.8% in 2022 and further to 14.0% in 2023. The year-over-year growth in shipments also experienced a significant decline, dropping from 88.7% YoY in 2022 to just 29.3% YoY in 2023.
  • Titan emerged as the fastest-growing smartwatch brand among the top five players in India in 2023. Titan’s smartwatch shipments grew an astonishing 283.4% YoY during the year, claiming the fourth spot in India’s smartwatch market. Notably, Titan’s market share more than doubled, increasing from 2.4% to 5.2% in just 12 months.
  • Samsung is not only struggling in the smartphone industry but also in the smartwatch market in India. The South Korean giant is no longer among the top 5 smartwatch brands in 2023, being surpassed by BeatXP.
  • Founded in 2020, BeatXP, a Gurgaon-based Fit-tech startup, has risen to become India’s fifth-largest smartwatch brand, securing a 3.8% market share in 2023.

It is surprising that, despite the global trend towards online shopping, India continues to show a preference for offline retail experiences. This is evident in the smartwatch market, where shipments to offline channels outpaced online ones, registering an impressive 55.6% YoY growth in 2023. In contrast, smartwatch shipments through online channels grew 26.1% YoY during the year.

India’s smartwatch market is experiencing unprecedented growth, dynamically adapting to evolving consumer behaviours, technological advancements, and the interplay of online and offline channels. The competition is fierce, and the emergence of new players like BeatXP, surpassing established giants like Samsung, adds an element of unpredictability. It would be interesting to see which smartwatch vendor will claim leadership in 2024.

Which smartwatch do you currently use, and what factors influence your decision when upgrading to a new brand? Let us know in the comment section!

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Over 20 Million Paytm Users in Limbo as Fastag Ban Sparks Chaos

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paytm fastag

The ban imposed by the Reserve Bank of India (RBI) on Paytm Payments Bank turned out to be just the opening act of a regulatory drama for Vijay Shekhar Sharma-led One97 Communications. Compounding the challenges, the Indian Highways Management Company (IHMCL) has now directed highway travellers to ditch Paytm and snag FASTags from a curated list of 32 banks. This deliberate exclusion is a direct result of Paytm Payments Bank currently undergoing regulatory scrutiny for alleged rule violations.

With over 70 million Fastag users in India, Paytm Payments Bank asserts a significant 30% market share, translating to more than 20 million users. In response to the impending shift, these 20-million-plus Paytm Fastag users are set to receive new RFID (radio frequency identification) stickers, as existing Paytm Fastags will be inoperative after February 29. This strategic move aims to ensure a seamless experience for millions of Paytm Fastag users on toll roads after the specified cutoff date, as revealed by sources familiar with the matter to ET.

The banks enlisted by the National Highway Authority of India (NHAI), managed by IHMCL, for Fastag services are extensive and prestigious. The list includes Airtel Payments Bank, Allahabad Bank, AU Small Finance Bank, Axis Bank, Bank of Baroda, Bank of Maharastra, Canara Bank, Central Bank of India, City Union Bank, Cosmos Bank, Equitas Small Finance Bank, Federal Bank, Fino Payments Bank, HDFC Bank, ICICI Bank, IDBI bank, Idfc first Bank, Indian bank, Induslnd bank, J&K Bank, Karnataka bank, Karur Vysya bank, Kotak Mahindra Bank, Nagpur Nagarik Sahakari bank, Punjab National Bank, Sarswat bank, State Bank of India, Thrissur District Cooperative bank, UCO Bank, Union bank of India, and Yes Bank.

What’s surprising is that none of these 32 banks are currently willing to onboard Paytm Fastag users. Banks may be hesitant to extend their services to Paytm Fastag users, possibly fearing potential reputational damage or regulatory scrutiny, particularly if issues arise with any of Paytm Fastag users.

“The only option left for such customers is to cancel the Paytm Fastag and buy new ones from any of the banks (listed by IHMCL),” Sources told ET.

FASTag is an RFID-based device revolutionizing toll payments for vehicles in motion. The RFID chip, affixed on the vehicle’s windscreen, allows customers to make seamless toll payments directly from their linked accounts. Operational at over 750 toll plazas, including national and state highways, FASTag simplifies and expedites the toll collection process across India.

What Will Happen to Your Paytm FASTag Balance?

Now, you must be wondering what will happen to the monthly or annual balance in Paytm FASTag if the customer opts for a switch.

Typically, banks providing FASTag services have well-established procedures for customers who wish to migrate from one service provider to another. This process may involve the deactivation of the existing FASTag (issued by Paytm in this case) and issuing a new one from the chosen bank. During this process, the entire balance in the Paytm FASTag account will either be refunded to the customer, or smoothly transferred to the new FASTag.

Customers are advised to contact both Paytm and the new bank promptly to ensure a smooth transition and obtain accurate information about the balance transfer process. It’s essential to be aware of any terms and conditions associated with the balance transfer, including potential fees or charges that may be applicable during the transition.

Paytm UPI Slowdown Raises Concerns

A noticeable slowdown in Paytm’s UPI transactions in India has become another concern. Data from the National Payments Corporation of India (NPCI) indicates a stagnation in Unified Payments Interface (UPI) transactions originating from Paytm Payments Bank (@paytm) over the past six months. Corporation of India (NPCI). In August 2023, Paytm Payments Bank reported a substantial 455.52 million UPI transactions, which declined to 410.19 million by the end of December 2023. On a broader scale, UPI transactions on Paytm’s proprietary handle (@paytm) surged only a modest 6.1% YoY between December 2022 and 2023.

Since the RBI imposed a ban on its banking services, Paytm shares have been on a downward trajectory. On February 16, at 9.30 am, the stock reached a new low, trading at Rs 324.40.

Other Fintech Startups Under Scrutiny

In the aftermath of the Paytm fiasco, the spectre of regulatory action looms over more payment banks in India. In a recent development, the Financial Intelligence Unit (FIU) has identified roughly 50,000 accounts lacking Know Your Customer (KYC) verification, potentially involved in suspicious transactions and money laundering activities. Notably, around 30,000 of these accounts belong to payments banks other than Paytm Payments Bank. The details have already been provided to the Reserve Bank of India (RBI) for further investigation.

In addition, the Enforcement Directorate (ED) has been probing a Mahadev app scam involving 10,000 UPI accounts registered with Paytm. However, after the RBI’s crackdown on Paytm Payments Bank, One97 Communications denied ED’s money laundering probe, citing reports as “malicious.”

Industry analysts emphasize that KYC challenges are not just limited to Paytm Payments Bank as many fintech startups, in their pursuit of rapid customer onboarding, often take shortcuts. This practice becomes more pronounced as these companies expand, leading to a significant challenge in effectively managing risk and compliance.

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