Special: MVAS: Where are we heading to?

BANGALORE, INDIA: At an instance when every industry across the world is witnessing a southward journey, telecom industry is treading an offbeat path.

Indian telecom sector is witnessing a growth trajectory like never before. A recent Gartner study finds that, while North America has been the largest telecommunication market, Asia Pacific (APAC) will surpass it in terms of telecom revenue in 2008. North American telecom revenue is forecast to total $511.6 billion in 2008, a 4.5 percent increase from 2007, whereas, the APAC market is projected to reach $513.1 billion, in the same year, up 8 percent from that of the previous.

The mobile user base in India is increasing by the day and is estimated to reach 296.08 million this year (350 mn in 2009). The competition in this space is becoming even more tougher with 3G ironing its, much deserved, way in. Many more telecom players, including Videocon, Essar, Swan Telecom, Unitech, are all set to make their presence in India.

India is one of the fastest growing economies in the world. But with the declining call tariffs, that have reduced from Rs 7.50- 1.06 lately, and ARPU, telecom operators are under constant pressure to retain its user base and sustain their revenue growth. So telecom operators are in look out for other means to keep up with the competition. Pankaj Sethi, president- corporate services- VAS, TTSL, says: “The share of SMS in the pie is declining among operators.”

Abhay Singhal, co-founder and head, global ad sales, mKhoj, says: “Of late, brands are going a step ahead and looking forward to value added services that are specific and measurable so as to reach those audience who may or may not have access to the conventional forms of advertising.”

Enters MVAS

Abhay Singhal, co-founder and head, global ad sales, mKhoj, says, “Mobile value added services have seen an unprecedented growth in India.” Revenue from MVAS is amounted to be $348.8 million by 2009.

Indian Mobile Value Added Service (MVAS) has come a long way from its early days of P2P SMS (Person-to-Person Short Message Service). Today MVAS portfolio includes graphics/wallpapers, ringtones, caller ring back tones (CRBT), SMS contests and games.

“Globally, mobile VAS can account for 25-30 percent of the total value of what operators generate, in advanced situations. However, in India, according to the Cellular Operators Association of India (COAI), it is at 10 percent currently and expected to contribute 20 percent of the mobile revenues over the next three years. The VAS industry in India is estimated to be at Rs 5000 crore and is supposed to grow to touch Rs 8000 crore by the end of FY '08,” Pankaj Sethi says.

Read On...

Features

Revenue disparity to be sorted out by mkt forces

Revenue sharing arrangements are best worked out by market forces and is dependant on the quality of product and value of copyright

What bogs the MVAS sector?

India has the second largest base in mobile Internet consumption. However, only 5-10 percent of the total mobile subscribers use the Internet 

'Go mobile but go rural'

Indian language diversity is a huge potential market for MVAS, which has been untapped for various reasons 

The road ahead for MVAS

3G will help build Internet and broadband penetration, by providing an alternative path to the expensive, last mile fixed line connectivity 

Interviews

Market dynamics will sort out revenue disparities

Once the push towards data services happens, operators will devise better revenue share for MVAS players

TTSL set to tap m-Commerce sector

A whole new range of m-Commerce services is available on Tata Indicom and we should see these broader services with m-Commerce as a string enabler 

'Mobile ad: Nascent but happening mkt'

Mobile advertising is related and similar to online advertising, but reaches far greater number of members, who can be categorised based on various parameters

'Text is the leader, but voice is equally growing'

MVAS, with the entry of 3G, is ushering in more and more players