Earlier this month, Flipcart has announced the acquisition of Letsbuy to enrich its portfolio of e-Commerce offerings. Here is yet another news(talks/rumors?) from Flipcart about its plan to integrate music service to the Flipcart website. The music service is being launched under the brand Flyte. Flyte would be a service which is 320 Kbps DRM free (pretty good) and device agnostic.
The music service is being powered by Mime360 which Flipkart acquired November last year. Mime360 was a Mumbai based Digital Media Distribution company. The digital media catalogue is being provided by Chakpak, a Bangalore based startup providing Bollywood media content. This is yet another attempt to grow stronger than Amazon which is slowly entering into the Indian market.
The key factor for the success of Flyte is a “Competitive pricing” of the tracks to reduce piracy. This is a very critical factor for the success of the service in Indian market which is being dominated by internet piracy.
Here is a Flipkart screenshot (available for a short duration in Flipkart website) revealing the introduction of the music service as reported in Woikr.
Also there are talks that Flipkart is gearing up for the ePub service.
I was really hoping that Google Music would enter into the Indian market, but i guess it is now too late for them and it might be a tough fight against the “to-be-homegrown” Flyte.
Amazon has received approval from FIPB (Foreign Investment Promotion Board) for setting up the logistics service in India. Amazon has been taking a series of baby steps for entering into the Indian market at the right time. The approval for setting up the logistics center adds a stepping stone for the Amazon expansion plans in India.
Amazon is waiting for the regulatory clearances from the FDI advisory board for starting the full fledged operations in India. If the clearance is obtained, then its going to be an e-Commerce war in India and the customers are the ones who are going to be benefited from the war.
It would be interesting to watch out for the mergers in the e-Commerce space. Flipcart move to acquire Letsbuy is a brilliant one at the right time. On the contrary, Amazon has setup Junglee.com to understand the customer behavior which would be helpful in some of the strategic decisions for its tie-ups with vendors in India. Amazon’s Logistics operations would be based out of Mumbai.
In just a few days after Amazon announced Junglee.com in Indian market, here comes an announcement from India‘s biggest e-Commerce giant and Bangalore based company Flipcard on buying the second biggest e-Commerce company Letsbuy.com which is based out of Delhi. Letsbuy.com was incorporated in 2009.
The deal is a mix of cash and equity and valued at around 25 M USD. Letsbuy.com has received a 6M USD in mid of January from Helion, Accel & Tiger Global for its expansion plans. Interestingly Accel & Tiger Global have investments in Flipcard as well in 2009 and 2010.
The acquisition of Letsbuy further strengthens the footprint of Flipcart in Indian market and increases the breadth of the product catalogue. As of now, Letsbuy.com caters to 150 brands including Microsoft, HP, Sony, Canon etc.
Flipcart users in India seems to be extremely satisfied with the level of service provided by Flipcart and hence Amazon has a long way to go in changing the mindset of the people for using its service.
Amazon launched Junglee.com in the first week of Feb-2012 as a part of its strategy to enter into the Indian e-Commerce space. Junglee.com enables sellers to showcase their products and acts as a middle-man in selling its products. At the moment, Junglee.com does not perform any logistics services for the sellers nor perform transaction at its website. Junglee.com was acquired by Amazon in 1998 from Indian entrepreneurs Rakesh Mathur and Ashish Gupta.
When I had a first look at Junglee.com website, it looked similar to Google Product Search for its US market. Google has now integrated its Google Payments/ Offer / Checkout services with its shopping platform. The interesting fact is that Google Product search is not quite organized for Indian market and Amazon is going to quite benefit from it through the Junglee platform. Remember eBay is not quite a big hit in India yet. After huge struggle from various players in the e-Commerce space for nearly a decade, Flipcart has successfully emerged as a winner in the space.
The question which still remains is what Amazon going to do with its Junglee platform. It is for sure not a platform where users can look out for discounted products (discounts from Junglee), but more of a product discovery application.
The reason for the launch could be attributed to the following facts:
- High valuation of the existing e-Commerce players in India. Amazon feels that it is not worth spending some “huge” money in acquiring existing players in the market.
-Time to build the logistics supply chain in any new geographies (similar to the services from amazon.com). Amazon is secretly doing the background work to build up its logistics supply chain and revamping its platform for online services. A sneak look at http://services.amazon.in/ . The entry now will ensure that Amazon is not left out in the race once its supply chain is built and ready-to-go.