Income tax slabs revised

No tax for income upto 1.6 lakh.

For income between 1.6 lakh - 5 lakh tax liability 10%. (old slab was Rs 1.6 to 3 lakh)

For income between 5 lakh - 8 lakh 20%. old slab was Rs 3-5 lakh)

For income above 8 lakh 30% (old slab was Rs 5 lakh +)

Additional investment of 20K in infra bonds over and above Rs 1 lakh in 80C.

Competition redefined!

Who sells the largest number of cameras in India?

Your guess is likely to be Sony, Canon or Nikon. Answer is none of the
above. The winner is Nokia whose main line of business in India is not
cameras but cell phones.

Reason being cameras bundled with cellphones are outselling stand alone
cameras. Now, what prevents the cellphone from replacing the camera
outright? Nothing at all. One can only hope the Sonys and Canons are
taking note.

Try this. Who is the biggest in music business in India? You think it is
HMV Sa-Re-Ga-Ma? Sorry. The answer is Airtel. By selling caller tunes
(that play for 30 seconds) Airtel makes more than what music companies
make by selling music albums (that run for hours).

Incidentally Airtel is not in music business. It is the mobile service
provider with the largest subscriber base in India. That sort of
competitor is difficult to detect, even more difficult to beat (by the
time you have identified him he has already gone past you). But if you
imagine that Nokia and Bharti (Airtel's parent) are breathing easy you
can't be farther from truth.

Nokia confessed that they all but missed the smartphone bus. They admit
that Apple's Iphone and Google's Android can make life difficult in
future. But you never thought Google was a mobile company, did you? If
these illustrations mean anything, there is a bigger game unfolding. It is
not so much about mobile or music or camera or emails?

The "Mahabharat" (the great Indian epic battle) is about "what is
tomorrow's personal digital device"? Will it be a souped up mobile or a
palmtop with a telephone? All these are little wars that add up to that
big battle. Hiding behind all these wars is a gem of a question - "who is
my competitor?"

Once in a while, to intrigue my students I toss a question at them. It
says "What Apple did to Sony, Sony did to Kodak, explain?" The smart ones
get the answer almost immediately. Sony defined its market as audio (music
from the walkman). They never expected an IT company like Apple to
encroach into their audio domain. Come to think of it, is it really
surprising? Apple as a computer maker has both audio and video
capabilities. So what made Sony think he won't compete on pure audio?
"Elementary Watson". So also Kodak defined its business as film cameras,
Sony defines its businesses as "digital."

In digital camera the two markets perfectly meshed. Kodak was torn between
going digital and sacrificing money on camera film or staying with films
and getting left behind in digital technology. Left undecided it lost in
both. It had to. It did not ask the question "who is my competitor for
tomorrow?" The same was true for IBM whose mainframe revenue prevented it
from seeing the PC. The same was true of Bill Gates who declared "internet
is a fad!" and then turned around to bundle the browser with windows to
bury Netscape. The point is not who is today's competitor. Today's
competitor is obvious. Tomorrow's is not.

In 2008, who was the toughest competitor to British Airways in India?
Singapore airlines? Better still, Indian airlines? Maybe, but there are
better answers. There are competitors that can hurt all these airlines and
others not mentioned. The answer is videoconferencing and telepresence
services of HP and Cisco. Travel dropped due to recession. Senior IT
executives in India and abroad were compelled by their head quarters to
use videoconferencing to shrink travel budget. So much so, that the mad
scramble for American visas from Indian techies was nowhere in sight in
2008. (India has a quota of something like 65,000 visas to the U.S. They
were going a-begging. Blame it on recession!). So far so good. But to
think that the airlines will be back in business post recession is
something I would not bet on. In short term yes. In long term a resounding
no. Remember, if there is one place where Newton's law of gravity is
applicable besides physics it is in electronic hardware. Between 1977 and
1991 the prices of the now dead VCR (parent of Blue-Ray disc player)
crashed to one-third of its original level in India. PC's price dropped
from hundreds of thousands of rupees to tens of thousands. If this trend
repeats then telepresence prices will also crash. Imagine the fate of
airlines then. As it is not many are making money. Then it will surely be

India has two passions. Films and cricket. The two markets were distinctly
different. So were the icons. The cricket gods were Sachin and Sehwag. The
filmi gods were the Khans (Aamir Khan, Shah Rukh Khan and the other Khans
who followed suit). That was, when cricket was fundamentally test cricket
or at best 50 over cricket. Then came IPL and the two markets collapsed
into one. IPL brought cricket down to 20 overs. Suddenly an IPL match was
reduced to the length of a 3 hour movie. Cricket became film's competitor.
On the eve of IPL matches movie halls ran empty. Desperate multiplex
owners requisitioned the rights for screening IPL matches at movie halls
to hang on to the audience. If IPL were to become the mainstay of cricket,
as it is likely to be, films have to sequence their releases so as not
clash with IPL matches. As far as the audience is concerned both are what
in India are called 3 hour "tamasha" (entertainment). Cricket season might
push films out of the market.

Look at the products that vanished from India in the last 20 years. When
did you last see a black and white movie? When did you last use a fountain
pen? When did you last type on a typewriter? The answer for all the above
is "I don't remember!" For some time there was a mild substitute for the
typewriter called electronic typewriter that had limited memory. Then came
the computer and mowed them all. Today most technologically challenged
guys like me use the computer as an upgraded typewriter. Typewriters per
se are nowhere to be seen.

One last illustration. 20 years back what were Indians using to wake them
up in the morning? The answer is "alarm clock." The alarm clock was a
monster made of mechanical springs. It had to be physically keyed every
day to keep it running. It made so much noise by way of alarm, that it
woke you up and the rest of the colony. Then came quartz clocks which were
sleeker. They were much more gentle though still quaintly called "alarms."
What do we use today for waking up in the morning? Cellphone! An entire
industry of clocks disappeared without warning thanks to cell phones. Big
watch companies like Titan were the losers. You never know in which bush
your competitor is hiding!

On a lighter vein, who are the competitors for authors? Joke spewing
machines? (Steve Wozniak, the co-founder of Apple, himself a Pole, tagged
a Polish joke telling machine to a telephone much to the mirth of Silicon
Valley). Or will the competition be story telling robots? Future is scary!
The boss of an IT company once said something interesting about the animal
called competition. He said "Have breakfast ...or.... be breakfast"! That
sums it up rather neatly.

-Dr. Y. L. R. Moorthi is a professor at the Indian Institute of Management
Bangalore. He is an M.Tech from Indian Institute of Technology, Madras and
a post graduate in management from IIM, Bangalore