Essar Acquires Stake in Obopay

It is increasingly becoming evident that m-commerce is gaining foothold
worldwide and everyone wants to get a slice of it. This is because it lets
consumers and the business community purchase, pay, and transfer money through
any mobile phone using mobile applications, text message, and mobile Internet.

Essar Communications Holdings (ECHL), the telecom subsidiary of Ruias-controlled
Essar Global, has acquired a strategic stake in Obopay, the pioneering company
for m-commerce. On this promising business opportunity, KB Rajendran, sr VP,
Business Development, Essar, says, “We are excited about our investment in
Obopay which gives us an opportunity to be involved in this promising business
segment. Obopay has introduced significant mobile payment innovations in the US
and, recently, in India. We look forward to working with Obopay to build upon
the integration of the mobile phone into the lives of consumers worldwide.”

It's a win-win situation for both. While Essar Communications looks forward
to set its foot in the m-commerce business, Obopay, with this latest round of
fund raising and the addition of Rajendren into its board of directors, looks
forward to continue to expand the mobile payments market that it has pioneered.
Through this strategic alliance, the duo will leverage on each other's strength,
benefiting both organizations in promoting mobile payment initiatives across
multiple geographies.

With Essar Global already having a strong foothold in India, Canada, the US,
Africa, the Middle East, the Caribbean, and South East Asia, this strategic
acquisition will help the company foray into the mobile payment business around
the world. Obopay's strategy has been to bring mobile payments to more consumers
through industry-first alliances like the one with Essar Holdings.

Essar led the current investment round and other investors, including
Alliance Bernstein, ONSET Ventures, Redpoint Ventures, Richmond Management and
Richmond Global Cellular, Citi, Société Générale, Qualcomm, and Promethean also
participated in it. New investors include Essar Communications Holdings, which
is already on an expansion spree, and Olayan America, a global investment office
of the Olayan Group.

The US-based mobile payments company, Obopay, is on the verge of launching
person-to-person mobile payment service in India, and the talks with more than
fifteen banks are on to launch the service very soon. The simple requirement for
mobile payment is a handset and a bank account by both the parties involved in
the transaction. This innovative mobile payment services has made possible an
unimaginable array of products and services, thereby, changing consumer's
lifestyle drastically.

Products and services like mobile ticketing, mobile vouchers/coupons/loyalty
cards, content purchase and delivery, location-based services, information
services, mobile banking, mobile brokerage, and auctions will be the ones to
affect economy of scale, quicker and easier delivery, privacy-friendly data
mining on consumer behaviour, and environment-friendly and resources-saving
efficacy in business transactions.

Kannan K

kannan@cybermedia.co.in