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Tag: 🔍Insights

  • China’s Rising National Debt & Its Implications

    China has been one of the world’s leading economic powers for almost two millennia. Until the late 1700s, it accounted for approximately one-quarter of the global GDP (Gross Domestic Product). By the time the industrial revolution was beginning in Great Britain by 1820, China was accounting for approximately one-third of the global GDP. These numbers factually reflected that China’s GDP at the time was six times as large as that of Great Britain.

    Under the leadership of Deng Xiaoping, the Chinese government began introducing economic reforms in the year 1978 which resulted in the country becoming the fastest-growing major economy in the world. China registered an average growth rate of 10% over the next 30 years. Its sustained growth rate could be attributable to its export relationships, its large-scale manufacturing sector, and the country’s low-wage workers.

    As one of the largest economies in the world, the country was successful in avoiding the global economic downturn due to the Covid-19 pandemic. However, in the year 2022, it posted one of its worst economic performances in decades because of the pandemic.

    China’s National Debt
    What is National Debt
    Reasons for China’s Increasing National Debt
    Impact of High National Debt on the Chinese Economy

    China’s National Debt

    As of the year 2020, the national debt of the People’s Republic of China stood at an approximate amount of USD 7 trillion. This amount was equivalent to around 45% of the country’s GDP. The off-balance sheet debt of Chinese local governments, as per the Standard & Poor’s Global rating, was amounting to approximately USD 5.8 trillion while the International Monetary Fund said that the debt owned by the state-owned industrial firms was another 74% of the total country’s GDP.

    According to Forbes, at the last measure, China’s debt of all kinds – public and private and in all sectors of the economy – amounted to a staggering USD 51.9 trillion, which is almost three times the size of China’s economy. Since the time Beijing first began tracking such statistics, twenty-seven years ago, this amount is the highest level of debt recorded.

    The Beijing-backed National Institution for Finance and Development has stated that local authorities are set to issue a new debt amount of approximately USD 570 billion for the next year. This precarious situation of China is further highlighted by its comparison of relative debt to the United States. By mid of the year 2022, China’s national debt was 40% higher than that of the US.

    A Case Study on America’s Rising Debt and its GDP
    The debt of the United States has had several ups and downs, but with the pandemic the debt of USA has crossed all time high. Lets understand America’s Rising Debt
    StartupTalkyPratyusha Srivastava

    What is National Debt

    National debt refers to the outstanding financial obligation of a particular country and what the central government owes to its creditors. The amount of the national debt of a country represents the past annual budget deficits. It is incurred especially to maintain government services during a recession when tax revenues decrease and government expenditure increases. Government debt is also created to cover costs from major shocks like a war, a public health emergency, or even a severe economic downturn.

    Reasons for China’s Increasing National Debt

    In previous years, China had successfully managed to keep its national debt lower than the US. This was possible due to the policies that were introduced by the state. The national debt of China had usually been held by domestic institutional investors, in particular state-owned banks. The investment and lending practices of these banks supported government policies like issuing bonds for infrastructure investments and insurance companies.

    However, in the last few years, the country has seen a consistently increasing national debt that has included government spending on development projects and slowing economic growth. The global financial crisis in the face of the covid-19 pandemic caused the state to inject more credit into government-owned enterprises. At the same time, Chinese authorities eased the way for companies to secure loans to restart the economy. This further increased the burden of debt on the country’s economy.

    China’s Local Government Debt Crisis Explained

    Impact of High National Debt on the Chinese Economy

    China’s financial system is not entirely transparent. This is given rise to concerns about the amount of actual debt that is being held by local governments and state-owned enterprises. Other related concerns are also highlighted like the risks associated with high-level borrowing and the overall debt of the country. Having said that, China is hopeful of ambitious economic growth due to its heavy investment in infrastructure projects. The economy has also taken proactive steps towards a consumption-driven growth model, although, it is yet to yield results.

    Despite the shadow that is cast on China due to its growing national debt, analysts remain optimistic about the country’s long-term prospects. They remain positive that although this will slow China’s ascent, it won’t derail the economy entirely.

    Conclusion

    The debt situation of China is set to grow further. There are two notable and significant issues impacting it. One is its demographic challenge with over 60% of the country’s population either retired or nearing retirement age. The second big concern is the country’s shortage of young workers which supports a growing aging population due to its decades-long one-child policy. This situation within the country is likely to continue for the foreseeable future and the country will rely heavily on debt to fulfill its social security pension obligations.

    FAQs

    What is the current debt of China?

    As of the year 2020, the national debt of the People’s Republic of China stood at an approximate amount of USD 7 trillion.

    What is National Debt?

    National debt refers to the outstanding financial obligation of a particular country and what the central government owes to its creditors. The amount of the national debt of a country represents the past annual budget deficits.

  • Ethical Considerations of AI: Addressing Key Concerns

    This article has been contributed by Arun Meena, Founder and CEO, RHA Technologies.

    Artificial Intelligence (AI) has emerged as a transformative technology with the potential to revolutionize various sectors of society, ranging from healthcare and education to business and transportation. However, like any new and powerful technology, AI brings with it a set of ethical considerations that demand careful attention and proactive action. In this article, we will explore the ethical dimensions of AI, focusing on key areas such as bias, malicious use, transparency, accountability, fairness, privacy, security, and specific concerns like AI in warfare, surveillance, discrimination, and job displacement.

    Bias: The Ethical Challenge of Unfair Outcomes
    Malicious Use: The Dark Side of AI
    Transparency: Illuminating the Black Box
    Accountability: Determining Responsibility in an Autonomous Era
    Fairness: Challenging Discrimination in AI Systems
    Privacy: Safeguarding Personal Data in the AI Era
    Security: Guarding Against Cyber Threats

    AI in Warfare: The Ethical Dilemma of Autonomous Weapons
    AI in Surveillance: Balancing Security and Privacy
    AI and Discrimination: Preventing Unjust Outcomes
    AI and Job Displacement: Navigating Economic Disruption

    Bias: The Ethical Challenge of Unfair Outcomes

    One of the most significant ethical considerations surrounding AI is the issue of bias. AI systems are trained on vast amounts of data, and if that data is biased, the AI system will inevitably perpetuate and amplify those biases. This can lead to unfair and discriminatory outcomes in critical areas such as employment, lending, and criminal justice. AI systems might inadvertently make decisions that systematically favor certain groups while disadvantaging others.

    For example, an AI system trained on a biased dataset of resumes that favors men may recommend men for jobs more frequently, thereby contributing to the underrepresentation of women in the workforce. These biased outcomes raise concerns about social inequality and reinforce existing disparities.

    Malicious Use: The Dark Side of AI

    Another ethical concern is the potential misuse of AI for malicious purposes. Deepfakes, which are manipulated videos or audio recordings created using AI, pose a significant threat. Deepfakes could spread misinformation, damage reputations, incite violence, and undermine the integrity of information.

    Imagine a deep fake video of a politician making false statements that they never actually said. Such malicious manipulation could have severe consequences, including the erosion of public trust and the manipulation of electoral processes. Addressing this challenge requires robust safeguards and countermeasures to prevent the misuse of AI technologies.

    Transparency: Illuminating the Black Box

    Transparency is a cornerstone of ethical AI systems. When AI algorithms make decisions that significantly impact people’s lives, such as determining loan approvals or hiring recommendations, the decision-making process must be transparent and comprehensible to those affected.

    To achieve transparency, several measures can be taken. Making the training data used by AI systems publicly available enables external scrutiny, allowing biases to be identified and addressed. Additionally, providing explanations for AI decisions, by revealing the factors and reasoning behind them, can help build trust and ensure fairness. Striving for transparency is not without challenges, but it is a crucial step toward promoting ethical AI deployment.

    Accountability: Determining Responsibility in an Autonomous Era

    As AI systems become more sophisticated and autonomous, the question of accountability arises. When AI systems make mistakes or cause harm, it can be challenging to assign responsibility, particularly when the decision-making process is opaque or when AI operates without direct human control.

    Establishing clear lines of responsibility and holding those responsible accountable for the outcomes of AI systems is paramount. This accountability framework should involve developers, organizations deploying AI systems, and relevant regulatory bodies. Accountability ensures that AI technologies are developed and utilized with due diligence and that any negative impacts are acknowledged and addressed promptly.

    Fairness: Challenging Discrimination in AI Systems

    AI systems must be designed to ensure fairness and prevent discrimination. They should not favor or discriminate against individuals based on their race, gender, religion, or other personal characteristics. Unfair biases embedded in AI systems can perpetuate social injustices and exacerbate existing inequalities.

    To promote fairness, developers, and organizations must implement rigorous measures to identify and mitigate biases in AI algorithms and datasets. This involves diverse representation in the data used for training, regular audits of AI systems for potential biases, and ongoing evaluation to ensure equitable outcomes for all individuals.

    Privacy: Safeguarding Personal Data in the AI Era

    As AI systems rely heavily on data, protecting individuals’ privacy is crucial. AI systems should only collect and use data, that is, necessary for their intended purpose, and they must obtain explicit consent before sharing data with third parties. The unauthorized use or sharing of personal data can infringe upon individuals’ privacy rights and erode public trust in AI technologies.

    Protecting privacy requires robust data protection mechanisms, stringent access controls, and adherence to privacy regulations and standards. Organizations should prioritize data minimization, anonymization, and secure data storage practices to maintain the confidentiality and integrity of personal information.

    Security: Guarding Against Cyber Threats

    AI systems, particularly when deployed in critical infrastructure such as power grids or transportation networks, must be resilient against cyber threats. Breaches in AI systems can have catastrophic consequences for society, ranging from disrupting essential services to compromising public safety.

    To enhance security, AI developers and organizations must employ robust cybersecurity measures. This includes implementing strong encryption, multifactor authentication, intrusion detection systems, and regular security updates. By prioritizing security measures, the risks associated with cyberattacks can be minimized, ensuring the responsible and safe use of AI technologies.

    AI in Warfare: The Ethical Dilemma of Autonomous Weapons

    The use of AI in warfare presents a unique set of ethical challenges. The development of autonomous weapons systems capable of making lethal decisions without human intervention raises concerns about the loss of human life and the potential for unintended consequences. The debate surrounding the ethical implications of these weapons necessitates global dialogue and the establishment of international regulations to prevent the misuse of AI in warfare and ensure human control and accountability.

    AI in Surveillance: Balancing Security and Privacy

    AI’s role in surveillance technology poses ethical concerns regarding privacy and potential government overreach. AI-powered surveillance systems can track people’s movements and activities on an unprecedented scale, raising questions about the boundaries between public safety and personal privacy. Striking a balance between effective security measures and respecting individuals’ rights to privacy is crucial. Clear legal frameworks and oversight mechanisms should be in place to prevent abuses and ensure that surveillance systems are used responsibly and within the boundaries of democratic principles.

    AI and Discrimination: Preventing Unjust Outcomes

    AI systems have the potential to perpetuate or even amplify discriminatory practices if not carefully designed and monitored. From biased hiring practices to algorithmic discrimination in criminal justice systems, the ethical challenges of preventing unjust outcomes are paramount. Establishing clear guidelines and regulations that promote fairness, diversity, and inclusivity can help mitigate these challenges. Organizations should prioritize unbiased data collection, algorithmic transparency, and ongoing auditing to identify and rectify any discriminatory effects of AI systems.

    AI and Job Displacement: Navigating Economic Disruption

    The rapid advancement of AI technologies raises concerns about job displacement and its societal impact. As automation increasingly replaces human labor, the ethical challenge lies in addressing the potential economic disruption and ensuring a just transition for affected workers. This may involve the revaluation of labor policies, the provision of retraining programs, and the creation of new employment opportunities that leverage human skills complementary to AI systems. Society must strive to strike a balance that maximizes the benefits of AI while minimizing adverse effects on employment and economic stability.

    Conclusion: Shaping an Ethical Future for AI

    Artificial Intelligence holds immense potential for positive societal impact, but its ethical dimensions must be addressed proactively. To navigate the ethical implications of AI, stakeholders from academia, industry, government, and civil society must engage in ongoing dialogue and collaboration. By promoting education and awareness about AI ethics, fostering transparency and accountability, and implementing guidelines and regulations, we can ensure that AI is harnessed responsibly and ethically for the greater benefit of humanity. Together, we can shape an AI-driven future that aligns with our values, respects individual rights and contributes to a more equitable and sustainable society.

    How Does Generative AI Search Work?
    Generative AI search would certainly revolutionize web search, but what matters most is accurate and unbiased AI, as the results can only be as good as the training data set.
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  • Revealing Recession: Exploring Types and Effects of Economic Downturns

    Germany, the largest economy in Europe and the fourth largest in the world has officially entered recession, screamed the news headlines not long ago. The threat of recession has been looming large ever since the world emerged from the global covid-19 pandemic. The continuing Russia-Ukraine war has only added to global economic woes.

    The IMF (International Monetary Fund) had predicted that recession will strike only in Germany and Britain in Europe in 2023. This prediction held true as Germany saw a decline of 0.5% in its GDP in the fourth quarter of 2022 and again a decline of 0.3% in the first quarter of 2023 as it succumbed to the pressure of high inflation.

    The economic stability of a country is heavily dependent on the goods and services it can produce, armed conflicts, health crisis, market trends, and consumer confidence. These are also the many reasons that can lead to a recession. Here is an in-depth look to understand the concept of recession and how and why economies succumb to it.

    What is Recession
    Causes for a Recession
    Characteristics of a Recession
    Types of Recession

    What is Recession

    Economics defines a recession as a business cycle contraction that occurs when there is a general decline in economic activity. In the world of business, however, recession is defined as a period of contraction in two consecutive quarters. The main reasons behind a recession could be a financial crisis, an external trade shock, an adverse supply shock, an economic bubble burst, or even a large-scale natural disaster. Recession and its effects are most commonly seen in the GDP (Gross Domestic Product) of a country, income, employment, industrial production, and wholesale and retail business. When any economy is threatened by a recession, its government usually responds by adopting expansionary macroeconomic policies that include increasing the money supply and decreasing interest rates or increasing government spending and decreasing taxation.

    Causes for a Recession

    The exact causes of a recession are not always possible to understand. However, a deeper insight into what are the causes that can trigger a recession can help understand the recession better.

    • Causes that shock an economy, be it a country or the entire globe, like a war or a health-hazardous pandemic can cause sudden and unexpected disturbances in the supply or demand of certain products and services
    • Major, and, often unexpected, stock market crashes can cause an economy to suddenly collapse as big money is suddenly lost. This can push an economy into a recession, very similar to the Great Depression
    • Changing fiscal policies of any government, like raising or lowering of taxes to influence an economy can also trigger a recession. This also includes the monetary policy of any government
    • When any industry grows at a rapid pace, it creates a bubble, which, when crashes leaves devastation which can trigger a recession. The prime example of this housing loan bubble that triggered the 2007-2008 recession
    • Investors making risky investments during an economic boom and then cutting back on spending in anticipation of a downturn are also psychological factors that can have very real consequences and trigger a recession
    What causes an economic recession? – Richard Coffin

    Characteristics of a Recession

    Earlier, an economic recession was determined solely based on the GDP of the economy it affected. However, over time the determining factors that characterize a recession have broadened to include various other factors. Some important characteristics of a recession are –

    • A decline in the real GDP of an economy for two consecutive quarters
    • A drop in high-value retail sales and a decline in even essential purchases
    • Rising unemployment with businesses laying off employees to cut costs
    • Supply and demand equilibrium witnesses a disruption
    • Businesses reduce production due to decreased demand
    • Increasing inflation affects the purchasing power of consumers

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    Types of Recession

    Even with a general definition and understanding of recession, it takes different shapes and forms. Based on the factors causing a recession and their recovery path, recession can be broadly classified into a few basic categories.

    Inflationary Recession

    Commonly known as a ‘boom and bust’ recession, it basically means that the economy expands at a much faster rate than planned. Such an economy faces a recession due to inflation. The government supervisory body, in an effort to contain the over-expansion, implements measures like increasing taxes, decreasing government expenditure, or even increasing interest rates. This leads to a general limiting of expenditure as consumer focus shifts to conservation and debt clearance leading to a ‘bust’ or a recession.

    Balance Sheet Recession

    Just as the name suggests, this occurs when an economy is overextended due to debt. As debt increases, spending patterns shift and reduce in an effort to clean up the balance sheets. This leads to a stagnant economy leading to a recession.

    Depression

    This is a recession in its severest form when a country’s GDP decline is in excess of 10%. The greatest example of this is the Great Depression of the 1930s.

    Supply Side-shock Recession

    This kind of recession occurs when the domestic or international supply chains are disturbed due to global events like wars, natural disasters, or even a public health crisis. If the supply chains are restored and the supply is replenished, these types of recessions do not continue for a long time. However, such recessions can last for a few years if the supply is not replenished and restored. It can also bring about a change in the way the product is utilized.

    Conclusion

    There is no guaranteed way to predict a recession. However, keeping in mind the various causes and how they apply to any current economic scenario of any country, can help in understanding the chances of an impending recession. There are many ways and means by which an individual can prepare for a recession like building savings, becoming debt free, keeping to a budget, and also keeping the personal resume current. It can also help to learn a new skill that can be a huge help in case unemployment strikes.

    Recessions are an economic reality. The severity of it depends on multiple factors. However, history teaches that most recessions last for a span of approximately one year. It helps to know how recessions can trigger and what they can impact. The more one knows the better one can prepare.

    FAQs

    What is recession?

    Economics defines a recession as a business cycle contraction that occurs when there is a general decline in economic activity. In the world of business, however, recession is defined as a period of contraction in two consecutive quarters.

    What are various types of recession?

    Recession can be broadly classified into a few basic categories-

    • Inflationary Recession
    • Balance Sheet Recession
    • Depression
    • Supply Side-shock Recession

    What could be the main reasons behind recession?

    The main reasons behind a recession could be a financial crisis, an external trade shock, an adverse supply shock, an economic bubble burst, or even a large-scale natural disaster.

  • E-Commerce Statistics and Facts You Need to Know in 2023

    Electronic Commerce, commonly known as E-Commerce, is defined as the buying and selling of goods or services on the Internet. The term embraces a wide variety of data, systems, and tools for online buyers and sellers which include mobile shopping as well as online payment encryption. In the year 2022, the global E-Commerce market size was USD 16.6 trillion which is expected to grow at a CAGR of 27.38% to reach a total size of USD 70.9 trillion by the year 2028.

    What is today’s reality, was pioneered by entrepreneur Michael Aldrich in the United Kingdom in the year 1979. He successfully connected a modified domestic television to a real-time multi-user transaction processing computer through a telephone line. It was this system that was commercially marketed and sold as business-to-business systems in UK, Ireland, and Spain.

    With the advent of the world wide web in the 90s, E-Commerce began to take shape and Book Stacks Unlimited, an online book store was created by Charles M. Stack in the year 1992. Then came the year 1995 and Amazon was officially launched, originally beginning its business operations as an online bookstore and the rest is history.

    Ever since then, E-Commerce has grown and expanded exponentially and is, even now, consistently growing. This behemoth has substantially impacted seller and buyer behavior. This article is a look at some statistics and facts about E-Commerce.

    Retail E-Commerce sales worldwide from 2014 to 2026
    Retail E-Commerce sales worldwide from 2014 to 2026

    E-Commerce Statistics & Facts
    Overall Impact of the Pandemic on the E-Commerce Industry
    Statistics Affecting E-Commerce Consumer Behaviour
    Statistics Affecting Mobile E-Commerce
    Statistics Affecting E-Commerce Marketing
    Statistics Affecting Social Media for E-Commerce

    E-Commerce Statistics & Facts

    Business, by its very nature, is organic. It is ever-changing and ever-evolving. E-Commerce is no different. It is impacted by the purchase behavior of global internet users, mobile shopping, E-Commerce marketing, and social media’s relation to online purchases.

    General E-Commerce facts to consider are –

    • Online global retail sales are projected to surpass USD 7 trillion by the year 2025
    • The cart abandonment average rate sits at 69.99%
    • 89% of E-Commerce companies are investing in personalization
    • Online sales through mobile commerce constitute more than 67.2% of all online sales
    • 54% of all consumers who follow businesses online want more video content
    • By the year 2025, sales from E-Commerce can reach 20.8% of all global retail sales to surpass USD 7 trillion
    • The year 2022 saw the electronics industry leading the online sales market generating a revenue of USD 988.4 billion. Other thriving industries in the E-Commerce retail space included furniture, toys and hobbies, personal and household care
    • China is the country that dominates the E-Commerce market share with over 80% of Chinese internet users buying from online stores

    While E-Commerce had been registering consistent growth since its advent, it is an indisputable fact that galloped its way to the forefront, especially during the pandemic. Hence, it is only fair to begin listing E-Commerce facts and statistics from this period.

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    Overall Impact of the Pandemic on the E-Commerce Industry

    Contrary to the reality of the physical world where everything stood still for a long time as the globe grappled with the terrible virus, the E-Commerce industry thrived and recorded exponential growth. This was the only way for buyers and sellers to connect and it was utilized immensely.

    • E-Commerce’s share of grocery retail grew from a mere 7% to 10% amidst the global lockdown
    • The online drug industry registered a 16% growth in revenue during the containment and lockdown period
    • All industries registered growth in their online business with food and personal care products recording the highest at more than 26%, toys, hobbies, and DIY at more than 21%, electronics, and media at more than 19%, furniture, and appliances at more an 17% and fashion at more than 14%
    • Small and medium B2B companies also registered a growth in their E-Commerce business revenue share
    • Overall, E-Commerce across the world registered an increase of approximately 19% in revenue in the pre and post-pandemic time during the year 2020
    The Future of Ecommerce: 9 Trends That Will Exist In 2030

    Statistics Affecting E-Commerce Consumer Behaviour

    E-commerce strategies of various businesses are centered around online shopping trends and evolving consumer behavior. The aim is to improve customer experience, thereby increasing sales. Prevailing E-Commerce facts and statistics are –

    • Approximately 70% of online shoppers abandon their carts midway and do not complete the process. This is related to the shopping experience – unexpected extra costs, account creation requirements, and/or a slow delivery process
    • Digital wallets have emerged as the dominant payment mode of all the global E-Commerce payment options available. It eases checkout processes and positively influences purchase decisions
    • More than 97% of online shoppers read and depend on online reviews before making the final purchase
    • Sustainability and environmental impact have emerged to be the chief concerns affecting more than 52% of global E-Commerce shoppers with the world dealing with 6.3 billion tons of plastic waste
    • Dominating global commerce sales, E-Commerce is the preferred shopping medium for almost 57% of customers due to its 24/7 availability, convenience, discount codes, health, safety, and speed
    • Consumer engagement on E-Commerce sites like live chat encourages sales with 38% of customers purchasing and more than 51% of customers showing an inclination for repeat purchases

    Statistics Affecting Mobile E-Commerce

    E-Commerce has evolved to fit on individual mobile screens with different E-Commerce business websites also building apps for higher customer engagement and a more personalized customer reach. Mobile E-Commerce also offers many opportunities for businesses to increase their brand awareness and result in sales.

    • Global mobile users are projected to reach 7.49 billion by 2025 accounting for 92% of the world population
    • Mobile E-Commerce has grown at a faster rate than general E-Commerce recording a growth rate of 29% and currently accounts for 67.2% of all E-Commerce transactions
    • The feature of voice shopping that is unique to mobile E-Commerce, contributes approximately USD 2 billion in consumer spending
    • Mobile users are increasingly using the QR payment method and it is estimated that by the year 2025, 29% of all mobile users will make payments using the QR code

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    Statistics Affecting E-Commerce Marketing

    The world of E-Commerce is highly competitive and changing continuously. Businesses must keep creating on-point marketing campaigns to remain relevant in such a business scenario.

    • A popular marketing strategy is loyalty programs that offer immediate rewards as it influences buying decisions
    • Personalization in the digital space is now commonplace and E-Commerce employs it robustly as the chances of repurchasing from customers increase by 78%
    • Video marketing is a highly influential tool in the marketing arsenal as 54% of consumers prefer to see video content from businesses of their choice
    • More than 70% of small businesses have a web presence increasing consumer awareness as well as reach
    • More than half of E-Commerce businesses (52%) are strong in providing a robust and seamless customer experience through omnichannel presence to increase brand visibility and increase customer loyalty

    Statistics Affecting Social Media for E-Commerce

    With the advent of the internet, social media grew and today forms an integral part of everyday lives. With the number of mobile users increasing every day, social media grows too and has now become one of the best online marketing channels. It is actively leveraged to increase sales.

    • The potential of a younger demographic customer pool is wider on social media apps like TikTok and Instagram and these apps have added new and improved features for E-Commerce functionality. Social commerce is estimated to generate USD 30.73 billion in E-Commerce sales by the end of 2023
    • 59% of the global population uses social media which is constantly growing with one report claiming that every second six new users join social media
    • The wealth of data available on social media sites about potential customers is invaluable for marketers as it helps them to be more competitive
    • Instagram has become the top social networking platform that keeps pace with the brands

    Conclusion

    Online shopping has grown to encompass the entire world within its grasp. Although a saturated space for E-Commerce businesses, this world is constantly evolving with the ever-changing consumer demographic. The statistics that hold true today for the E-Commerce world may also change. Hence, it is imperative for any business that is considering venturing into this space, to conduct due diligence as to the current trends that are steering E-Commerce.

    FAQs

    What is E-Commerce?

    Electronic Commerce, commonly known as E-Commerce, is defined as the buying and selling of goods or services on the Internet. The term embraces a wide variety of data, systems, and tools for online buyers and sellers which include mobile shopping as well as online payment encryption.

    How much are online global sales projected to grow by 2025?

    Online global retail sales are projected to surpass USD 7 trillion by the year 2025.

  • What are Startup KPIs & How to Track Them

    The definition of a startup company states that it is a company or project undertaken by an entrepreneur to seek, develop and validate a scalable business model. Such newly formed companies, typically, do not have a fully developed business model and, more importantly, they lack adequate capital to grow and expand. They begin their business operations with high costs and limited revenue.

    There are many startups that turn to family, friends, and even venture capitalists for seed capital that can be used for market research as well as developing a business plan. As a business is taken off the ground by the entrepreneur, there are many important considerations like deciding on a location, the legal structure of the company, setting up the distribution channel for their product or service, etc. However, continually measuring the performance of the business to ensure that it remains valid, scalable, and relevant tops this list.

    What Are Startup KPIs?
    Need For Startup KPIs
    Important KPIs To Track

    What Are Startup KPIs?

    Key Performance Indicators, more commonly known as KPIs, are used extensively by businesses to measure their value and success. As true as these are for established businesses, startups fall into a different category in relation to KPIs.

    To drive growth that is meaningful and relevant to the target market, startup KPIs are used to identify, evaluate and develop a better strategy that helps to improve operational efficiency. Such KPIs, as related to startups, are the qualitative and quantitative measures that allow them to grow and sustain themselves.

    Need For Startup KPIs

    KPIs allow startups to better evaluate their business processes, and understand their efforts and the related results. It helps them to concentrate their focus and efforts better on processes that deliver better results through sound business decisions.

    • KPIs highlight the right path and direction for the business
    • Measuring KPIs allows the startup to identify gaps in the products or services and recognize areas that need improvement
    • KPIs are extremely helpful to showcase business results to prospective investors. It shows sincerity and focus as it can help the entrepreneur highlight the YoY business growth projections

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    Important KPIs To Track

    Having understood what are startup KPIs and why are they needed; it is equally important to have a clear understanding of exactly what KPIs need to be tracked for a startup.

    Addressable Market Size

    As the header suggests, this measures the company’s target audience and market size which, then, determines the number of consumers it might attract. What this does is give the startup an idea of its operating budget by determining the marketing needs. This KPI can be measured through conducting market research and communicating with their target audience through various forms of advertisement and social media.

    Profit Margin

    Undeniably, this is probably the most important KPI to track for a startup. This can be measured by calculating the difference between the cost of manufacturing and the final selling price. This gives an insight into the company’s return on investment and the probable time period in which the company might turn profitable. It also helps in evaluating the company’s long-term sustainability prospects and its growth.

    Calculating Monthly Burn

    Startups commonly have a negative cash flow in the beginning stages of their business operations due to either higher customer acquisition rates or smaller profits. The monthly burn statement helps them to understand their total debt and the money that they might lose every month in the beginning. Simplistically, monthly burn is calculated as the revenue generated minus the expenditure for inventory and overheads.

    Adora Cheung – How to Set KPIs and Goals

    Measuring the Runway

    This is a KPI that allows the company a clear understanding of the time they have before the cash runs out. Commonly, the runway time for startups is between 12 and 18 months to gain a steady number of customers and become profitable.

    Measuring Customer Acquisition Cost (CAC)

    Manufacturing cost, marketing cost, and distribution cost, all add up to a final number called the Customer Acquisition Cost (CAC). This is a cost that startups must be aware of and maintain strict vigilance on it. CAC is directly proportional to the growth time of a business.

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    Measuring Customer Retention Rate (CRR)

    Customer retention is important for the survival of any business, especially startups. Measuring CRR gives a startup a clear idea of how its product is performing in the market. It also helps startups to estimate future sales on a monthly basis and take steps to improve and increase customer retention.

    Measuring Customer Lifetime Value (CLV)

    This particular business metric allows the business to understand the business a startup may receive from a customer over the course of the company’s lifespan. The higher the customer retention rate of a startup, the higher the customer lifetime value for the company. It helps the startup to determine its growth as well as identify potential sales forecasts.

    Measuring CAC Recovery Time

    After measuring the CAC, it is also important to measure what will be the time frame in which the startup will begin making a profit from their customer acquisition cost. Measuring the CAC recovery time also helps a startup in gaining insights into the possible net revenue that the company might generate, affecting the organization’s cash flow and financial growth.

    Conclusion

    Startups are businesses that aim for success through growth and expansion by building a business that is sustainable by driving revenue growth. Hence, their business strategies have to be focused on driving a product that answers a customer need and growing their customer base through customer acquisition and customer retention. Hence, every step taken in a startup business operation must be well thought out and measured so that the path to success becomes clearer and more focused. That can be achieved by measuring KPIs to ensure that the business is growing in the right direction and that the money invested will result in continued and sustained profits over a long period of time.

    FAQs

    What are startup KPIs?

    To drive growth that is meaningful and relevant to the target market, startup KPIs are used to identify, evaluate and develop a better strategy that helps to improve operational efficiency. Such KPIs, as related to startups, are the qualitative and quantitative measures that allow them to grow and sustain themselves.

    What KPIs need to be tracked for a startup?

    The KPIs that need to be tracked for a startup are:

    • Addressable Market Size
    • Profit Margin
    • Calculating Monthly Burn
    • Measuring the Runway
    • Measuring Customer Acquisition Cost (CAC)
    • Measuring Customer Retention Rate (CRR)
    • Measuring Customer Lifetime Value (CLV)
    • Measuring CAC Recovery Time

    What is Customer Acquisition Cost?

    Manufacturing cost, marketing cost, and distribution cost, all add up to a final number called the Customer Acquisition Cost (CAC). This is a cost that startups must be aware of and maintain strict vigilance on it. CAC is directly proportional to the growth time of a business.

  • Unveiling the Power of AI and Tech Startups: Transforming Industries for the Future

    This article has been contributed by Kanav Singla, CEO and Founder, Metadome.ai.

    Rapid technological advancements and artificial intelligence (AI) have significantly changed how we live, work, and businesses operate and compete. Here, digitalization has become a key driver of growth and innovation in industries across the globe, providing businesses with new opportunities to streamline their operations, reduce costs, increase productivity, improve efficiency, and enhance the customer experience. For instance, cloud computing has enabled businesses to access a wide range of IT resources on demand without making significant upfront investments in infrastructure.

    Furthermore, with the rise of tech startups, we have witnessed an explosion of innovation and creativity, disrupting traditional business models and transforming entire industries. From healthcare and finance to retail and education, the potential for AI and technology startups to transform various sectors is immense. According to a report by venture capital firm Stellaris and the World Bank-backed International Finance Corporation (IFC), by the year 2030, startups in India focusing on artificial intelligence (AI) and software as a service (SaaS) will have the potential to generate a market value of over $500 billion. These startups use cutting-edge technologies such as machine learning, the Internet of Things (IoT), and blockchain to create innovative solutions that address complex challenges and improve our quality of life. However, as with any disruptive technology, some potential risks and challenges must be addressed, such as the ethical use of AI, data privacy concerns, and the impact on jobs and the economy.

    Here’s a look at the potential for AI and tech startups to transform industries and examine how they are already making an impact.

    Extended Reality

    Extended Reality (XR), encompassing Augmented Reality (AR), Virtual Reality (VR), and Mixed Reality (MR), presents an enormous potential for AI and tech startups to revolutionize multiple industries. By seamlessly blending the digital and physical realms, XR opens new avenues for immersive experiences and transformative applications. Global market expansion is driven mainly by the rapid adoption of extended reality in the educational space, as well as industrial training and ongoing advancements in 5G technology. According to MarketsAndMarkets, the market for extended reality is anticipated to grow from $40.1 billion in 2023 to $111.5 billion in 2028 at a CAGR of 22.7%.

    The emergence of XR has brought significant advantages to startups across various industries like healthcare, education, manufacturing, etc. Among these, startups in the education sector have tremendous potential to create interactive learning environments, enabling students to explore subjects with unparalleled engagement. For instance, an education startup can create a dynamic learning environment using XR by developing virtual laboratories, enabling students to conduct scientific experiments in a simulated and risk-free setting. Furthermore, XR startups have the power to redefine entertainment, gaming, and retail experiences, delivering personalized and captivating interactions. For instance, XR can revolutionize the customer shopping experience by virtual try-on solutions allowing customers to try on clothing, accessories, or even eyewear before making a purchase. With AI-powered innovations, startups are well-positioned to harness the transformative capabilities of XR and reshape industries in groundbreaking ways.

    Healthcare Industry

    AI and technology startups have revolutionized the healthcare industry by introducing significant advancements. These developments have transformed healthcare delivery, from early disease detection and diagnosis to personalized medicine and drug development. AI-powered diagnostic tools have become increasingly prevalent, enabling healthcare professionals to analyze medical images accurately and quickly. Consequently, potential health issues can be identified, enabling healthcare professionals to provide the right treatment plan.

    Furthermore, virtual assistants, led by AI, are being used to optimize patient care and streamline processes, resulting in shorter waiting times and allowing doctors to allocate more time to patient care. Innovative healthcare solutions, such as wearable devices, are being developed by technology startups to monitor vital signs and collect data on patient health. Thus, by analyzing this data in real-time, healthcare professionals can track changes in a patient’s health and intervene when necessary.

    Retail Industry

    The retail industry has undergone significant changes due to the emergence of technology startups and the implementation of AI-based solutions. According to Grand View Research, the worldwide market for artificial intelligence in the retail industry was valued at $5.79 billion in 2021 and is poised to grow at a CAGR of over 23.9% from 2022 to 2023. Furthermore, online shopping platforms have transformed the way consumers shop by offering convenience and wider product choices. AI-led solutions have also brought about a more personalized shopping experience. Hence, by analyzing customer data, recommendation engines can suggest products based on their purchase history and preferences.

    In addition, technology startups leverage innovative solutions to improve supply chain management, minimize waste, and promote sustainability. According to a study by Accenture, SRM has several advantages, including enhanced supplier performance, less risk, increased cost savings, and increased visibility and control over the supply chain. For instance, blockchain technology is being utilized to track products throughout the supply chain, ensuring greater transparency and accountability. This technology can also reduce waste and enhance sustainability by enabling retailers to trace the production process of products and ensure sustainable practices.

    Education Industry

    Even though the education industry has been known to be resistant to change, the emergence of AI and technology startups is leading to a transformation in this field. Online learning platforms have revolutionized the way education is accessed, making it more affordable and flexible, enabling learners to study at their convenience and pace. According to Business Today, nearly half of all learning management tools will incorporate AI by 2024, and there is expected to be significant growth in the use of AI in the education industry, with a CAGR of 40.3% between 2019 and 2025. Furthermore, AI-driven solutions also improve the learning experience by personalizing it for students, and adaptive learning algorithms scrutinize student data to provide tailored learning paths and recommendations.

    Technology startups are developing innovative solutions to enhance the quality of education and increase student engagement. For instance, gamification makes learning more interactive and engaging, where students can receive points and rewards for completing tasks and achieving learning objectives. Additionally, virtual and augmented reality technologies are also implemented to provide immersive learning experiences, making it possible for students to explore intricate concepts in an interactive and engaging manner. According to MarketsAndMarkets, the market for gamification in education is anticipated to increase from $450 million in 2018 to $1800 million by 2023, with a CAGR of 32% during the forecast period.

    Disruptive Innovations: Transforming the Business Landscape

    The potential for AI and technology startups to transform industries is immense. From improving healthcare and finance to enhancing the retail and education industries, the impact of these innovative solutions is already being felt around the world. As businesses continue to embrace these advancements, it is essential to ensure they are used responsibly, focusing on promoting the well-being of all stakeholders. Thus, by doing so, we can create a more equitable and sustainable future for all.

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  • How to Use GPT-4 for Free?

    Ever since the launch of OpenAI’s generative AI Chatbot ChatGPT, there’s a renewed focus on artificial intelligence and what artificial intelligence can do, and what it can achieve– not that there was no focus on AI before, but you have to admit that AI and ML development and research was not at the dinner table, it was not part of the conversation in our homes, not like ChatGPT has become. ChatGPT has become a big deal. Do you know what powers ChatGPT has? The GPT (Generative Pre-trained Transformer) model does it.

    OpenAI’s ChatGPT is developed using the GPT-3, 3.5 model— a large language model (LLM) capable of generating human-like text, creative content, etc.

    ChatGPT is trained on a large dataset of texts and code and human dialogues, approx. 570GB dataset and 6B parameters, so that, it understands human conversations and responds in a human-text output.

    It can remember the conversation string and respond to users in a more relevant and informative way.

    The GPT-4 Model Developed By OpenAI

    Now that you know what GPT and ChatGPT are, let’s come to GPT-4, which launched only a few months ago.

    GPT-4, short for Generative Pre-trained Transformer-4, is a substantial improvement over the GPT -3 model. OpenAI claims that the GPT-4 is a step up from its GPT-3 model in size and capability, and it is the first model that can generate coherent, high-quality language across multiple modalities, including text, image, and audio. This opens up new possibilities for applications in fields like virtual assistants, gaming, and content creation.

    It is trained with over 170 trillion parameters making it significantly more extensive than its predecessor GPT-3. Apart from that, it also takes user feedback to improve its responses. It is safer and more accurate than its predecessors.

    The development of the OpenAI’s GPT-4 model wasn’t an overnight job though ChatGPT was an overnight hit, and there is no denying that. The transformer architecture behind the GPT model was first introduced in a 2017 paper by Vaswani et al. from Google Research, titled “Attention Is All You Need”, and OpenAI carried out the specific implementation of the Transformer architecture in GPT models. OpenAI perfected the model to take user instructions and then generate answers instead of writing for the users. That is how InstructGPT was born, which later became the basis of ChatGPT that we use now.

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    How To Use GPT-4 For Free

    People using ChatGPT know how convenient this AI tool is. However, it lacks accuracy and efficiency, and its data is limited to the year 2021. It is living in the past, and we are in the future (relatively speaking). Can you see the irony in that?

    And that is why people are eager to use OpenAI’s newest, more capable, and more accurate GPT model, the GPT-4. On its availability, OpenAI says, “GPT-4 is available on ChatGPT Plus and as an API for developers to build applications and services.” So, if you’re not a ChatGPT Plus subscriber (yes, it’s not free, and it costs 20$ per month) or a developer, we have a list of ways to use GPT-4 for free.

    OpenAI’s Research Access Program
    Through APIs Provided by OpenAI
    Microsoft’s New Bing
    Hugging Face
    Poe AI
    OpenAI Playground

    OpenAI’s Research Access Program

    OpenAI Research Access Program Form
    OpenAI Research Access Program Form

    OpenAI has released research previews for GPT-4, which users can access for free by applying for access. While this option is limited, it still provides users with a way to experiment with GPT-4 before its full release. So, if you’re interested in doing some research on how ChatGPT Plus, GPT-4 will affect humans in a good or bad way, fill out this Researcher Access Program form and wait for OpenAI to approve.

    Through APIs Provided by OpenAI

    Join API Developer's Waitlist
    Join API Developer’s Waitlist

    OpenAI plans to offer several APIs for interacting with GPT-4 directly from application software without direct access to the underlying model files. These APIs can enable developers to integrate advanced language capabilities into chatbots, customer service tools, content creation platforms, language translation services, etc. So, if you are a developer, you can join the API developer’s waitlist and wait for OpenAI to grant you access.

    Microsoft’s New Bing

    Use GPT-4 for free on Microsoft's New Bing
    Use GPT-4 for free on Microsoft’s New Bing

    In February 2023, Microsoft CEO Satya Nadella announced its new Edge browser and New Bing search engine, which is now more capable than before since it uses OpenAI’s latest GPT model. Microsoft has been a partner in OpenAI’s efforts in AI and deep learning research and development since 2019 when Microsoft invested 1B USD in OpenAI’s AI program. And now Microsoft is leveraging the tremendous potential of AI generative web search to battle it out with Google in web search, which Google holds the monopoly of, well, until now. So, if you like, you can open up the Bing search engine on Edge browser and log in with a free Microsoft account to use GPT-4 powered Bing AI Chat and use GPT-4 to generate text, translate languages, write different kinds of creative content, and ask it to answer your questions in an informative way, all for free. So, feed your curiosity on Bing (e)!

    Hugging Face

    Use GPT-4 for Free - Hugging Face
    Use GPT-4 for Free – Hugging Face

    It is an open-source platform that provides pre-trained models, including GPT-4, for developers to use in their applications. Developers can deploy pre-trained language models on their own infrastructure or cloud platforms by using open-source AI frameworks such as Hugging Face’s Transformers.

    The platform offers a user-friendly interface, and you can navigate the feature quite easily. Although it does produce unrelated responses in its AI Chat sometimes, but then, which AI isn’t?

    HuggingChat: This is HUGE for Open Source ChatGPT!

    Poe AI

    Use GPT-4 for Free - Poe
    Use GPT-4 for Free – Poe

    Poe is an online platform that currently provides access to OpenAI’s GPT-4 language model. It offers a free plan that allows users to make one GPT-4 query per day and a paid plan which costs 1900INR per month and provides more queries (at least 600) and additional features. The platform also includes a chat interface for interacting with the GPT-4 model.

    OpenAI Playground

    Use GPT-4 for Free - OpenAI Playground
    Use GPT-4 for Free – OpenAI Playground

    The OpenAI Playground for GPT-4 is an online interface where users can experiment with the GPT-4 model and generate text outputs based on user prompts. It provides a variety of settings for customizing the model’s behavior, such as controlling the prompt length and sampling temperature. The Playground also includes a selection of pre-built prompts to experiment with.

    Like ChatGPT, the GPT-4 model is a super success and now powers the new ChatGPT Plus, the successor of ChatGPT. The OpenAI CEO Sam Altman recently made it clear the company OpenAI is not training the next gen GPT, the GPT-5 yet, so there is still time. And meanwhile, we should explore what GPT-4 can and what it cannot do cause the path to AI development must be ‘responsible AI’ development kind as Google CEO mentioned in this year’s Google I/O, the annual developers’ conference, recently concluded in May 2023.

    FAQs

    How to use GPT-4 for free?

    GPT-4 can be used for free by using any of the following-

    • Through OpenAI’s Research Access Program
    • Joining APIs Developer’s Waitlist
    • Microsoft New Bing
    • Hugging Face
    • Poe AI
    • OpenAI Playground

    What is the pricing offered by Poe AI?

    Poe AI offers a free plan that allows users to make one GPT-4 query per day and a paid plan which costs 1900INR per month and provides more queries (at least 600) and additional features.

  • Intel or AMD: The Better Processor

    Both are American multinational technology companies manufacturing semiconductor chips. Both were founded around the same time. Both have global business operations and both are avid competitors on the world stage.

    One is named Intel Corporation and the other is Advanced Micro Devices, Inc., commonly known as AMD. Producing semiconductor chips that develop computer processors and related technologies, both these companies compete within the same market space vying for the same customers. Here’s a brief history of these companies and a look at their business operations to determine who is better with their products.

    Origins & Expansions
    The Better Brand

    Origins & Expansions

    Intel Corporation

    It was the year 1968 when Gordon E. Moore, a chemist, and Robert Noyce, a physicist and a co-inventor of the integrated circuit, founded Intel in Mountain View, California. A venture capitalist and investor, Arthur Rock extended help by finding investors and Max Palevsky was on the board from the early days.

    Intel was distinguished from the very beginning by its ability to make logic circuits using semiconductor devices. The main aim of the founders of the company was the semiconductor memory market, which was then, widely predicted to replace magnetic-core memory. Working towards this, the company experimented with various products, finally producing the first commercial metal-oxide-semiconductor field-effect transistor silicon gate SRAM chip, the 256-bit 101. The company created its first commercially available microprocessor in the year 1971 and the first microcomputers in the year 1973. Intel also opened its first international manufacturing unit in the year 1972 in Malaysia followed by opening assembly facilities and semiconductor plants in Singapore and Jerusalem in the early 1980s. In the early 1990s, it opened manufacturing and development centers in China, India, and Costa Rica.

    The growing success of IBM personal computers that was based on the intel microprocessor prompted the company to shift focus to the microprocessor business which proved to be a huge factor in the company’s continuing success. However, challenges and obstacles greeted Intel at the turn of the century. AMD emerged as a strong competitor to Intel, challenging its dominant market position. Over the years, through various other products and refocusing on its core business, Intel has tried to regain its previous market leader position. AMD has succeeded in challenging Intel by providing stiff market competition.

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    Advanced Micro Devices, Inc. (AMD)

    AMD was incorporated in the year 1969 by Jerry Sanders, an electrical engineer, and a group of other technology professionals. The company initiated its business operations by becoming a second source supplier of microchips that were designed by Fairchild Semiconductor and National Semiconductor and focused on producing logic chips. AMD entered the RAM chip market in 1971 and following its success went public in 1972. It also entered the microprocessor market in 1975 with a product that was almost an exact copy of the Intel microprocessor. By that year, AMD was producing a total of 212 products – 49 of which were proprietary.

    A business agreement with IBM by Intel, led Intel and AMD to enter into a 10-year technology exchange agreement in 1981, stating that either company could become a second source manufacturer of semiconductor products developed by the other. Then in the year 1991, it introduced its AMD-designed chip and began to compete directly with Intel.

    AMD survived the dot-com bubble and has traveled a winding road, facing many challenges and obstacles, and emerged successful. In the year 2021, it announced a partnership with Meta to make the chips used in the Metaverse. The year 2022 saw AMD enter into a partnership with Samsung to develop a mobile processor to be used in future products.

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    The Better Brand

    Over the years, AMD has emerged as a major player in the processor market and the big war is between Intel and AMD. In a consumer-centric market, tough competition means a broader choice for the customers. What this essentially comes down to is a comparison between the two products and their performance on various fronts.

    CPU Performance

    Intel and AMD CPU Performance
    Intel and AMD CPU Performance

    The 13th-gen line of CPUs from Intel offers the best value for money which is a strong pull for consumers. However, AMD’s latest Zen-based processor is the most powerful consumer-grade chip, even if it is a little expensive. AMD’s chip is most valuable for users using advanced 3D rendering software. The more affordable from AMD’s offering is the AMD Ryzen 77700X, although, its performance in comparison with Intel Core i7-12700K is not up to the mark. Intel is currently set to dominate the mid-market with the release of its Intel Core i7-13700K.

    The Number’s Game

    Both companies were founded by ex-employees of Fairchild Semiconductor. However, Intel began stronger and successfully bagged IBM as a client for supplying microprocessors for their first personal computers. After that, it cemented its position as a market leader through various innovative products and became a multi-billion-dollar conglomerate and an undisputed market leader. Intel also has a much stronger revenue stream and higher R&D budgets.

    AMD, on the other hand, did begin strong and began competing with Intel but faced numerous challenges and obstacles through the years. By 2010, the company had fallen far behind Intel and had to go back to the drawing board with renewed focus. This move proved a turning point for them and their new Zen architecture has given Intel a run for their money.

    Intel vs AMD: Strengths & Weaknesses Of Each Platform

    Cost

    In the earlier days, AMD’s products were much lower priced than that of Intel, although, the difference is negligible these days. However, the cost of a technology product goes much deeper than the money count. AMD’s CPUs, although costlier, offer cross-generational compatibility that integrates seamlessly with the latest hardware. Intel products have not always been so adaptable, which results in a higher expense, eventually. Also, AMD offers more energy-efficient products than Intel.

    Laptop Performance

    AMD has begun challenging the laptop CPU market, which was, until now, Intel dominated. Both these companies offer great laptop CPUs. It rather depends on the user which CPU would suit best, based on the kind of use of the laptop.

    Conclusion

    While both companies are neck-to-neck with their product offerings, both Intel and AMD CPUs have differing uses. Intel makes the best CPUs for the average everyday user. However, users with high-end workstations would benefit better from AMD CPUs. While scouting for CPUs, users should keep in mind their usage for deciding the best product.

    FAQs

    When was Intel founded?

    Gordon E. Moore and Robert Noyce founded Intel in 1968.

    When was AMD founded?

    AMD was incorporated in the year 1969 by Jerry Sanders and a group of other technology professionals.

    When did Intel create its first microprocessor?

    Intel created its first commercially available microprocessor in the year 1971 and the first microcomputer in the year 1973.

  • Visa vs. Mastercard: The Clash Between the Cards

    Electronic payments can be defined as a digital transaction between two parties. These payments include ACH, cards, bank transfers, digital wallets, mobile payments, and many more. When it comes to credit cards, the global electronics payment industry is dominated by four giants – Visa, Mastercard, American Express, and Discover.

    From these four, it is Visa and Mastercard are arch rivals with distinct product offerings. Both these companies issue payment cards through co-branded relationships. Even as these two companies do not extend credit or issue cards, their product repertoire consists of credit facilities, and debit and prepaid card options are issued through various business partnerships.

    Company Overview
    Common Benefits
    Other Benefits

    Company Overview

    Visa and Mastercard, both exclusively operate as network processors and are involved in all three areas of the payments market. The companies have similar business operations, offering payment cards to the public through partner member financial institutions. The member financial institutions issue cards either directly or in partnerships with airlines, hotels, or even retail brands.

    Visa Inc.

    Visa was founded in the year 1958 as BankAmericard, headquartered in Fresno, California. It was the brainchild of Bank of America’s in-house Product Development team, Customer Services Research Group, and Joseph P. Williams, its leader. In response to its then competitor, Master Charge, the BankAmericard program was licensed to other financial institutions in the year 1966. In the year 1970, Bank of America gave up direct control of the BankAmericard program and formed a co-operative with other various BankAmericard issuer banks to take over its Management. It was renamed to Visa Inc., in the year 1976.

    Currently, the world’s second-largest card payment organization, Visa commands a 50% market share of total card payments. In the year 2020, Visa Inc.’s net revenue was a whopping USD 21.8 billion with a payments volume of USD 8.8 trillion. The company’s core product repertoire consists of credit, debit, and prepaid cards as well as business solutions and global ATM services.

    How Visa Became The Most Popular Card In The U.S.

    Mastercard Inc.

    Also an American company,  Mastercard Inc. was founded in 1966 in Purchase, New York. The company has an interesting history, with it first being known as Interbank and then Master Charge before settling for its current name. It was created by an alliance of several banks and regional bankcard associations in response to the BankAmericard, which was issued by Bank of America. BankAmericard later became Visa, which is still Mastercard’s biggest global competitor. Mastercard Inc.’s, initial public offering was in the year 2006, when it became a publicly traded company. Before its IPO, Mastercard Worldwide was a cooperative that was owned by more than 25,000 financial institutions.

    The year 2020 saw Mastercard Inc.’s net revenue at USD 15.3 billion with a payment volume of USD 6.3 trillion. The company’s core product offerings include consumer credit, debit and prepaid cards, and a commercial product business. Its business segment known as Payment Solutions, is broken as per geographical locations across the US and the world.

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    Both these companies are known for offering three different card levels. Visa offers traditional, signature, and infinite while Mastercard’s card offerings include standard, world, and world elite.

    Common Benefits

    When it comes to credit card product comparison of Visa and Mastercard, it is only fair that the product offering of both companies is compared on similar grounds. Some benefits are common to both, some existing due to federal regulations while others have become industry standards, expected by issuers to be provided for their customers.

    Zero Liability Protection

    Both companies protect their user base against unauthorized charges. In the event a credit card has been used for fraudulent purchases, the user can report it to the issuer and have the card blocked and the transaction reversed. In such a scenario, the charges are borne by the card company.

    Visa - Report a Lost or Stolen Card
    Visa – Report a Lost or Stolen Card

    Cell Phone Protection

    This is also a service that is provided by both companies. Visa Signature members can get cell phone protection each month when they pay their wireless bill with their Visa card. On the other hand, World Mastercard offers a USD 1000 yearly coverage on cell phone protection in the event of a cell phone gets stolen or needs certain repairs, when the phone bill is paid with World Mastercard.

    Global Emergency Services

    Although both companies offer this service, Mastercard offers it for every card level available anytime, anywhere, and in any language. This helps in replacing a stolen card, access of cash advances, etc. Visa offers travel and emergency assistance services for Visa Infinite card holders that provide help in an emergency across the world.

    Mastercard - Global Emergency Services
    Mastercard – Global Emergency Services

    Other Benefits

    Visa

    Visa offers three tiers of credit cards to its customers – Visa Traditional, Visa Signature, and Visa Infinite. Visa Signature and Visa Infinite offer maximum benefits and perks. However, on the whole, Visa offers more benefits than Mastercard.

    a) Purchase Protection and Insurance offers additional benefits to Signature and Infinite card users that include lost luggage reimbursement, trip delay, cancellation, and interruption reimbursement, extended warranty protection, zero liability protection, etc.

    Benefits of Visa Infinite
    Benefits of Visa Infinite

    b) Visa Signature Luxury Hotel Collection offers its members special status at more than 900 participating hotels. This allows members access to seven premium benefits that include the best available rate guarantee, automatic room upgrade on arrival if available, complimentary in-room Wi-Fi when available, complimentary breakfast for two, USD 25 food or beverage credit, VIP guest status, and late checkout upon request.

    Visa Signature Luxury Hotel Collection
    Visa Signature Luxury Hotel Collection

    c) Travel benefits for Signature and Infinite card members that include, Global Entry statement credits, Priority Pass lounge access, special Visa Signature offers, and rental car privileges.

    d) Emergency Services that Visa provides for its members include important services like roadside dispatch, lost or stolen card reporting, emergency replacement, emergency cash disbursement, etc.

    Mastercard

    Mastercard too offers three different tiers of credit cards, with each one offering benefits and perks. The three different card categories include Standard, World, and World Elite. Below are some common benefits offered by Mastercard.

    a) Purchase Protection and Insurance which is offered by all three cards with World and World Elite cards offering the most benefits. These include Mastercard ID theft protection, cell phone protection, global emergency services, etc.

    Benefits of World Elite Masterclass
    Benefits of World Elite Masterclass

    b) Concierge Services is offered by World Elite Mastercard which can schedule restaurant reservations, and event tickets, or even help in purchasing items that are hard to find. There is no user fee attached to this card. World Mastercard users can use Mastercard Airport Concierge and special Golf Concierge service through Priceless Golf.

    c) Mastercard Luxury Hotel and Resorts Portfolio gives World and World Elite Mastercard members access and upgrades at more than 3000 properties across the world. Depending on the property, the amenities can vary, offering complimentary daily breakfast, amenity credits up to USD 100, and other perks.

    Mastercard's Travel and Lifestyle Services
    Mastercard’s Travel and Lifestyle Services

    d) Luxury Event Deals offer access to many luxury events like special access to PGA Tour gold outings, access to Priceless Experiences that include film festivals and cooking lessons from private chefs, and many others.

    The Better Card – Conclusion

    Both Visa and Mastercard offer several advantages, some mandated by rules and regulations, others as industry norms demanded by end consumers. Each one has its benefits that appeal to individual consumers. While it is difficult to pinpoint a clear winner, both these companies are world leaders in their operational sectors. Depending on individuals and the benefits that most suit them, credit cards can be chosen.

    FAQs

    When was Visa founded?

    Visa was founded in 1958.

    When was Mastercard founded?

    Mastercard was founded in 1966.

    What are the three cards offered by Visa?

    Visa offers traditional, signature, and infinite credit cards.

    What are the three cards offered by Mastercard?

    Mastercard’s card offerings include standard, world, and world elite.

  • Growth of the Indian Smartwatches Market

    The year 1972 has a marked significance in that it was the first time ever that computers became small enough to fit in a wristwatch. Hamilton Pulsar was the first-ever digital watch released that year. Another was the Calcron calculator watch that featured a nine-digit display. In the year 1983, the Seiko Data 2000 was released which was one more smartwatch predecessor. This watch could store two memos of 1000 characters each. It could also be attached to a keyboard that came with the watch, used to type memos.

    Since then, smartwatches have evolved to now being able to track, store and transit complex data about the wearer. They can now monitor fitness information, monitor and spot potential medical conditions as well as transmit location information through GPS in the event of an emergency.

    The Global and Indian Smartwatch Industry
    Reasons for Growth of the Smartwatch Market in India
    Best Budget Smartwatches in India

    The Global and Indian Smartwatch Industry

    By the year 2021, the global smartwatch industry size was a whopping USD 30434.1 million which is expected to grow at a CAGR of 8.2% between 2022 and 2030. This increase is attributed to the growing inclination for fitness tracking and the health monitoring features available on smartwatches.

    Smartwatches Global Revenue
    Smartwatches Global Revenue

    As per the report from the International Data Corporation (IDC), the wearables market of India saw a robust YoY (Year-on-Year) growth of 46.9% in the year 2022 with shipments reaching 100.1 million units. Of this total number of shipments, 30.7% were smartwatches. Growing exponentially from a shipment size of 4.95 million in the fourth quarter of 2021 to 8.59 million in the fourth quarter of 2022, smartwatch shipments represent a 73.6% YoY growth. Of the many models of smartwatches, basic smartwatches have continued to dominate the market showing an annual growth of 158% in the year 2022.

    This growth has shown no signs of abating as the first quarter of 2023 shows that the Indian smartwatch market has recorded a 121% YoY growth. Putting it simply, India has emerged as the biggest market for smartwatches with a 27% market share.

    Reasons for Growth of the Smartwatch Market in India

    The numbers showcase a consistent and exponential growth of smartwatches in India. The growth has been significant, especially since the global covid-19 pandemic as people have become more health conscious. The first quarter of 2023’s recorded growth of 121% is also important as global sales actually declined during this time period due to macroeconomic situations. However, it was India’s growth contribution that restricted the decline in global shipments to 1.5%.

    Product Affordability

    One of the primary reasons for the growth is also the availability of affordable smartwatches.

    Anshika Jain, an analyst at Counterpoint Research says – “India’s smartwatch market grew 121% YoY in Q1 2023 driven by affordability, rising customer demand, and availability of a wide variety of options in the budget segment.”

    This growth comprised more than 40% of smartwatches sold priced under INR 2000. There are other reasons that have played a key role in the growth of the Indian smartwatch market.

    Rise of Local Smartwatch Makers

    Indian smartwatch makers dominated the smartwatch market claiming more than 90% of sales.

    Anshika Jain added – “The share of India-based players crossed 90% for the first time as they were quick in terms of upgrading their portfolios and adapting their products to customer needs at a reasonable price point.”

    In terms of global smartwatch shipments, Indian smartwatch maker Fire Boltt outpaced Samsung and reached the second position in the first quarter of 2023. Fire Boltt increased its shipments of affordable smartwatches three times YoY.

    Globally, India also became the largest market for smartwatches, accounting for 27% of all worldwide smartwatch sales. North America accounted for 26% of global sales while China was a distant third with a 18% market share.

    Indian Wearables Market – A Comprehensive Study of the Growth of Wireless Industry
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    StartupTalkyHarshit Verma

    Best Budget Smartwatches in India

    India’s lion market share of the smartwatch market is occupied by budget users looking for smartwatches that are affordable, medium, and premium. Customers want and expect certain features in a smartwatch – battery life, screen size, price, calling features, health tracking features, and last but certainly not least, style. Some of the best budgets buys within the Indian brand offerings are Titan, Noise, boAt, Fire Boltt, etc.  These brands offer smartwatches that meet all customer demands and they are also quick to respond to new market demand with designs that are sleek while keeping the cost low.

    5 Best boAt Smartwatch between 2000 – 5000 Top 5 Smartwatch by boAt 

    Conclusion

    The Indian smartwatch market is growing and is showing no signs of slowing down even amidst the global smartwatch shipment decline and other economic problems. Indian brands are gaining prominence amongst strong global players and making a strong place for themselves.

    FAQs

    What are the reasons for the growth of the smartwatch market in India?

    The reasons for the growth of the smartwatch market in India are:

    • Product affordability
    • Rise of Local Smartwatch Makers

    Which Indian brands offer reasonable smartwatches?

    Some of the best budgets buys within the Indian brand offerings are Titan, Noise, boAt, Fire Boltt, etc.