Industry News Interplay between Indian VAS Industry and 3G Revolution
Since the entire telecom market is getting over possessed with the 3G revolution, will the spread of 3G mobile service boost the growth of this multi-billion dollar value added services (VAS) market? Aided with innovative content, will it lead to affordable handsets attracting users in both rural and urban areas? Let’s find out!
The key drivers for the growth of 3G in India will be innovative content, improved customer services and increased affordability of handsets as well as availability of value added services. These features will help ensure growth of 3G not just in urban areas but in rural markets as well.
Currently, the VAS market is worth Rs 110-120 billion (Rs 11-12,000 crore), about 10 per cent of the total revenues of the wireless industry and is likely to increase to 12-13 per cent during 2011.
The development would be driven by growing focus of operators on VAS in view of continuous fall in voice tariffs, greater penetration of feature-rich handsets, spread of vernacular content and increased adoption of applications.
Besides, new segments like m-commerce and m-advertising gathering momentum in the coming years, latest technologies and advancements towards 3G and 4G services are providing a clearer path for mobile VAS grow exponentially.
Promising economies of countries like China, India, South Africa, Indonesia, Brazil, Russia, etc are anticipated to increase global VAS revenues.
Even though voice VAS continues to dominate a large revenue share, the contribution of Mobile VAS (Value-Added-Services) to Indian telecom industry is immense. In the arena of falling ARPU’s, VAS still maintains the stand of a key differentiator for the telecom operators. The mobile VAS market has been growing around 60% year-on-year. This is largely due to the aspects credited to mobile advertising, m-commerce, 3G, multi-media games, mobile internet for a quicker data access and also the rural VAS market that has a huge potential in India.
In India, SMS, Ringtone, Caller Ring Back Tone (CRBT) and Games constitute the bulk of the VAS. VAS delivery has been mainly based upon SMS, IVR, GPRS and WAP platforms. Currently with the excess of value added services at their disposal, operators are moving toward an outsourcing model for VAS as well, in order to reduce costs. This shows the degree of involvement of the Mobile VAS service in a positive and negative manner.
With the much awaited 3G spectrum, the Indian telecom industry will see a high level of connectivity, de-congested networks and simultaneous data and voice network. Thanks to the innovative VAS offerings the mobile device is all set to become the third screen of the world.