The ‘OPEX‘ change brought about by the startups to businesses

The start of the year 2016 witnessed India achieving a rare milestone of crossing over one billion mobile subscribers. The country is also witnessing a smartphone evolution that has dramatically altered the consumer behavior.  Mobile phones have now become the most preferred medium of purchase for a range of products and services to the extent of even four wheelers.

This smartphone evolution has also triggered a new wave of start-ups emerging that are fundamentally built on the premise of enhancing the user experience- be it in terms of convenience or price. More importantly the emergence of these start-ups has revolutionized the business ecosystem dramatically in the sense that a CAPEX-based business model suddenly appears out of date. The OPEX model is what stakeholders are looking at.

Thus you have the likes of Uber, Ola, Bookmyshow, Zomato to name a few, that have kept their capital investment to the bare minimum and are offering services by liaising with value chain partners. The virtual world is the present day marketplace with consumers left spoilt for choice among millions of world class products and services. This virtual world resides on the mobile handheld device and companies now strive to not build a physical structure to carry out businesses but rather a virtual app-based entity to drive business growth-all built on the premise of OPEX focus.  

In a way the OPEX quotient is now looked upon as a measurement of the company’s success in sustaining itself. From an asset-rich focus, companies now strive to be ‘asset-light’. The IT domain too has transformed into an OPEX proposition now. Cloud is the most prominent outcome of this transformation. Thus you have servers hosted on cloud, software hosted on cloud, in many cases the whole IT infrastructure hosted on cloud.