TRAI to introduce framework for VAS providers

By : |April 19, 2011 0

[image_library_tag 198/18198, align=”left” title=”” height=”158″ alt=”” hspace=”7″ width=”200″ vspace=”7″ border=”0″ ,default]NEW DELHI, INDIA: As the data continues to grow, nearly tripling for the third year in a row, the role of value-added service providers have become immense. With a view to regulate VAS providers and bring them into a framework, Telecom Regulatory Authority of India (TRAI) is working closely with Assocham and Deloitte for the preparation of a consultation paper.

Data is new growth driver

Sanjay Kapoor, CEO India and South Asia, Bharti Airtel and chairman of COAI recently acknowledged that data is the new growth driver. TRAI has also invited views on MVAS report as a pre-cursor to consultation paper on VAS in January.

Assocham together with Deloitte has undertaken a study on MVAS with a focus on utility services.

“VAS providers are important and content has become a crucial part for broadband penetration,” said JS Sarma, chairman of TRAI. He also said that there is a need to have a collaboration between VAS and telecom services providers. With the phenomenal growth in data, TRAI is working to streamline the process.

“We are in consultation with Deloitte and Assocham, and will come up with the consultation paper for VAS providers by the end of June,” informed Sarma.

Speaking to CIOL, Deepak Halan, group business director, IMRB International said that TRAI’s initiative for a regulatory framework on VAS providers is good news for all the entities in the revenue chain leading to the operators.

MVAS sector see entry of many players

“With ‘apps’ becoming a popular word even amongst the common man, the MVAS sector in India has seen entry of a number of players that include content developers, aggregators, converters, content owners, technology enablers, short code providers as well as there are the traditional media companies, mobile operators and handset manufacturers,” he said.

The eTech Group of IMRB International in its recent study revealed that the mobile operators capture anywhere between 60 to 70 per cent of the revenue; technology enablers get between 10 to 20 per cent; content aggregators 10 to 15 per cent; and the content pockets 5 to 10 per cent share.

“Markets such as China, Japan and Europe have an organized business model where the telecom operator keeps 20 to 30 per cent of the revenue, while the rest goes to content providers and content aggregators. These countries have mobile and MVAS markets that are much more evolved than India,” he informed.

Halan suggests that perhaps an ideal revenue sharing arrangement could be one where the operators charge for access to their pipes and keep the access revenues, charge a fee for billing and collection and pass the rest of the revenue to MVAS providers and content owners.

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