Indian mobile VAS industry valued at more than Rs 7,000 crore has so far been dominated by entertainment services such as mobile music, ring back tones (RBTs), wallpapers and plain SMS. Though services such as RBTs have been a real success, the MVAS ecosystem players often paid little attention to other innovative services that can be of use to a larger audience. However, with hyper competition in the mobile services sector with voice average revenue per user (ARPU) continuing to decline, operators cannot afford to ignore public utility services. What are examples of such utility services and how are they beneficial to the masses?How useful it would be for the travellers if they are forewarned about the closing time of Bandipur forest (in Karnataka) while one is planning to make a journey in the evening through the thickets, instead of getting stranded at the entrance. Would not it be good if everyone is forewarned through SMS about the harmful effects of radiation emanating from the corona and the needed precautions to be taken during the astounding solar eclipse which we witnessed late January? Though one has been getting travel alerts from the traffic police in the metros about major procession in the city, it would be of immense use to get alerts periodically; even better, based on the location in the city or town one is travelling and the possible detours so that traffic bottlenecks can be circumvented. SMS alerts targeted at specific locations may provide better reach than the traditional public address system to warn people of catastrophic events such as tsunami and flash floods that are quick and devastating. In countries such as Japan and Sri Lanka, technology known as “cell broadcast” is used to send early alerts about earthquake and tsunami through mobiles to specific regions of the country.

There are a host of health-related public VAS services that can be provided, especially in the rural areas, to select target audience. SMS reminders and alerts can be sent to registered pregnant women on next medical checkups; to mothers of infants on next immunisation schedule; to patients on doctor’s arrival time; to nurses for attending and monitoring school health check-up programs in villages. For certain diseases such as tuberculosis, SMS alerts to patients on due dates for check-ups, and to doctors on the next doses of medicine to be administered to specific patients, will improve the efficacy of directly observed treatments.

Tourism Promotion Councils in districts such as Kanniyakumari in Tamil Nadu that earn substantial revenues from tourism can enable SMS-based advertisements for hotels in the area indicating room availability, prices and directions to promote a tourist friendly hospitality industry.

Farmers from far-off villages often go to nearby towns and cities once a week to participate in mandis to sell their agri products. More often than not customers do not know the advantage of coming to mandi and sometimes may not even know the venue and timings. Information on products and the mandi prices can be sent via SMS alerts so that customers have information and reason to come to mandi to buy products. Increase in demand will also encourage farmers to come to mandis to sell their products. Mobile devices, which are truly personal, provide an opportunity to learn anytime-anywhere. People in rural areas can be educated in languages using “word-a-day” paradigm through which they learn words, their meanings and pronunciations using voice SMS. Mobiles may be the only channel available in certain rural areas of the country for enabling banking and can be deployed effectively using the strong distribution network of the mobile service providers. Mobile payment and banking enable quick turnaround time for remittances, especially in rural areas as demonstrated by service providers such as Zain on in Africa.

Examples such as the ones mentioned above can be delivered by the ecosystem comprising of mobile service providers, the appropriate government/municipal agencies, and private content providers. So far, the various government agencies have not utilised the mobile services technology for disseminating public information. It is time that the agencies embrace this powerful and ubiquitous technology to disseminate public information for the benefit of the citizens. The service providers and content providers should also realise that utility MVAS remains an unexplored territory in India, however showing a good promise for the off-take of the still fledgling MVAS industry in India.

(The authors, Rajendra Ratnoo & V Sridhar, are collector of Kanniyakumari and Research Fellow of Sasken Communication. Views are personal)

Source : Economic Times

Today Entertainment category of VAS contributes the highest share in any Indian operators VAS portfolio. Bollywood today is the world’s largest entertainment industry, producing more than a 1000 movies a year with an audience of more than

Source: Merill Lynch estimates, IDC, Yankee Group, CBIC World Markets, and inCode analysis

2 billion viewers across 127 countries and the content demand is not only high in India but also overseas. Interestingly today’s mobile devices have shifted the entertainment from a content or network play to a device based play. Mobile devices with integrated music and video player, FM and high memory features have flooded the market accompanied with low cost associated with it. Entertainment content from the web world is being fed into the device memory and is being used. Even games for this case are downloaded from the web and dumped into devices.
In such an unfavorable scenario, the Operators are making a lot of investments in infotainment content and services. The demand for infotainment content and services like news, astrology, location based services, maps etc; have had a significant growth in the recent past and is expected to grow even more in future.

2.    Focusing on Rural VAS

In emerging markets especially in countries like India, majority of the population is rural i.e. the Bottom of the Pyramid (BoP). Rural teledensity in India was at 16.54% as of May 2009 compared to urban teledensity of more than 88.6% around the same period. This figure is expected to reach about 36.25% by 2013.
Around 30% of Airtel’s wireless subscriber base resides in the rural parts of the country, whereas for Vodafone, BSNL, Reliance Communications and Idea Cellular, the rural user base is around 31%, 34%, 19% and 30% of their respective wireless pie. With such mass revenue potential hanging around, operators are shifting their focus on VAS for BoP. Initiatives by Airtel, Reliance and Idea Cellular to connect with their rural masses are already visible with their tie ups with livelihood content providers like IFFCO and Reuters Market Light for services related to agriculture, weather and livelihood. The below figure clearly maps out the characteristics of the different mobile population and their mobile content needs.

However, finding localized content for the BoP mobile population remains a food for thought for the operator. Though many content providers are emerging in this value chain that can help with rural and livelihood related content, monetizing the content will require quite a bit of effort form the operator in terms of creating awareness and delivering true value addition.

3.    Subscription to On Demand VAS (Sachet)

To give mobile users flexibility, especially the ones at BoP with Value Added Services, many operators have begun offering services like ringtones, alerts and games on a daily pricing model instead of monthly.  Reliance Communications rolled out this model in June 2009 however impact on its VAS revenues has not been known. In 2006 RCOM tested out  the ’sachet model’ in association with Jump Games, now a Reliance Entertainment company – it effectively reduced the price points as other operators were either offering subscriptions or bundling VAS. Many of us would believe that with lower price points the VAS ARPU would also be low but this type of packaging will help VAS become a larger part of the subscriber pie thus increasing the penetration. Moreover this would give an on demand user experience that makes the consumer feel more connected to its operator.

The above figure depicts the price sensitiveness of Mobile Content / VAS in a developed market like US where majority of the mobile population own a high end device. This gives us a picture that if developed countries like US with loaded gadgets and infrastructure are so price sensitive then what would be the scenario in emerging markets where majority of the population is at the BoP.

4.    SMS based to Voice based VAS
Voice based VAS services constitute around 40% of the total VAS market today and most of them are via IVR which is expensive to the operator as well as to the end user. Voice based VAS services are expected to grow roughly at a CAGR of around 80% in next 3 to 4 years. In geography like India where there are more than 1600 regional dialects and 22 constitutionally approved languages, it becomes difficult for operators to deliver text based services in vernacular.

Moreover Voice based services do not have any learning curve for the end user as compared to an SMS or a GPRS based service where the end user has to learn the process of using or accessing the services. And with majority of the population not tech savvy, this would act as a barrier to penetration and usage of mobile services as voice has the highest user experience level. Adjacent figure clearly depicts that only 8% users are GPRS users and 49% are SMS of which maximum is P2P.

The figure on the left is an outcome of a survey conducted by Ericsson on the control factors affecting use of m-content services in Uganda and India. The major barriers identified for access to mobile services in India were high cost of the service followed by awareness on how to use the services and its unavailability in local languages. Today an end user pays Rs 6/min for an IVR based service like listening to songs, setting CRBT, etc. which is way too expensive and is a major barrier for mass usage of VAS.

Thus in order to increase usage of services and to reach wider audiences, operators need to focus on Voice delivery, but they also  need to work around innovatively  on the high IVR costs associated with current Voice based services.

5.    Increasing usage of Mobile Internet
With mobile phones becoming the fastest penetrating digital device and perhaps the most popular one, it has also become the easiest way to access any information on the fly. With internet boom in India a decade ago, we were right in believing that the world had shrunk and information on anything in any part of the world is just a click away. Yet the broadband rates, PC penetration, power supply and the last mile connectivity are key issues to be addressed for mass adoption of broadband.

Mobile adoption on the other hand has been phenomenal and with falling handset prices and enhanced features, it has enabled internet access to the masses. Though speeds are a challenge which we are sure 3G and forthcoming technologies will address to, but mobile has made the shrunk world more personalized because though PC stands for personal computer, it’s never personal. An average town family that has one PC has more than one mobile. In rural areas, where even mobile is a shared device, this helps in accessing information as the last mile connectivity and cost of devices are not a challenge in contrast to a PC.

According to TRAI’s March 2009 report, there are about 117.82 million mobile Internet users out of 415 million mobile users in India in contrast to 6.4 million broadband PC Internet connections. India had 101.1 million mobile subscribers owning phones capable of accessing Internet at the end of December 2008.

Source: InMobiAS – Getting the ABC Right

VAS – Getting the ABC right

For a VAS service to succeed in any market there are three basic key attributes that must be looked at. These are as follows:

1.    Accessibility of Service
2.    Bundling of Service
3.    Content Quality

A killer VAS is a combination of all these above attributes. Any standalone attribute cannot contribute to the success of a VAS.  The users will not subscribe for a VAS that has poor or unauthorized content, or will not subscribe the VAS in spite of good content if the packaging or pricing is too high or the delivery channel for accessing the service has a complicated learning curve.

Ensuring the fulfillment of ABC attributes is just half the job done. Supplementing ABC with the key marketing essentials like promotion, branding and lifecycle management completes icing on the cake. It is very important for a VAS to effectively communicate its value delivery to its target audience failing which the VAS is unable to connect with revenues that it can deliver. Success of a VAS also depends upon management of its lifecycle. VAS like CRBT would have not seen a boost if boosters like Press * to copy the song, Gaana Bolo Hello Tune Pao, etc; hadn’t been given. Today CRBT constitutes as much as 40% of an Indian Operator’s VAS revenue and is an unbeatable killer VAS.

Mr. Subhash Dhar, Member Executive Council and Group Head – Sales and
Marketing, Infosys* quoted in his keynote speech that till now Internet was
considered a radical phenomenon but now the Mobile is all set to create a
similar revolution. Mobile Value Added Services are about to create a huge
buzz in the market for the masses.”The point was supported by *Mr. Uday
Sodhi, Chief Executive Officer, Balaji Telefilms* “The current Average
Revenue per User (*ARPU*) lingers around 8-9% however by the end of this
year we shall see a rise to about 12-14% with an extensive increase to
nearly Rs. 11,000 Crore.” “The future of businesses will be driven by
broader digital engagement with their consumers and will act as a catalyst
in the future economy” according to *Mr. Dhar*. He further added that all
ecosystem players will have to join hands to bring Mobile Value Added
Services to the masses.

With over more than 500 Million mobile phone users in the country,
penetration to various areas with multilingual diversities and providing vast
content like games, applications, astrology, Mobile banking etc. and related
services is a challenge which has to be accomplished. The emphasis was on
the 3G/4G aspect and providing faster access like broadband availability to
take MVAS further. *Mr. Shyam Mardikar, Sr. Vice President – Networks,
Bharti Airtel Limited* said “Telecom is a mature business and the consumer
is choosy, quality of services needs to be refined, optimised and
manifestation of existing services has to be done”.

*Shri. SS Sirohi, Principal General Manager & Head, VAS, Bharat Sanchar
Nigam Limited* spoke about mobile banking transactions focus on volumes and
diverse content provisioning, mobile advertising, Location based services
like GPRS which are in their initial stages. Nearly 7.5 Lakh customers are
using 3G BSNL, currently available in 300 cities and the target is to spread
it to 700 cities by July 2010. 50 Million ringtones are downloaded every
month. The Indian Premier League shall be merging with Youtube and the
cricket match can be viewed from the cell phone with a staggering 36 camera
view options. The speed of 3G is 3.5Mbps if the download speed is enhanced
or the bandwidth is increased, user will have an enriched experience by
downloading movies, games, and utilities at a faster rate. He added, new
customers, new platforms, new generators, new operators are joining the
market everyday so the opportunity is tremendous.

The MVAS will bring about a change in lifestyle of the common man according
to *Mr. Lloyd Mathias, President & Chief Marketing Officer, Tata
Teleservices Limited,* he elaborated his point by giving an example of a
fisherman from Kerala who has to sell his fish to the dealer at the rate at
which the dealer pays him, however with the introduction of MVAS, he will be
able to get the best deal available. The *chief guest* in the conference *Mr.
RN Prabhakar, Member, Telecom Regulatory Authority of India, (TRAI)* had a
similar opinion and focussed on how MVAS has become so important and
innovative for the telecom operators with the intense competition bringing
down the ARPU and the tariff. Finally he concluded the speech saying “MVAS
will bring about a huge change and improve the living standards for all the
classes and the market is just ripe for bringing about and to be a part of
the change”.

For the last years, the strategy used by operators in the region was to promote mobile communications to every corner of the continent, from all major cities to the most recoded places in south Patagonia, Atacama Desert, to the Amazon jungle, and the Caribbean seas. This strategy, based on aggressive price competition was extremely successful. Operators achieved its objective of mass adoption of mobile phones. However now that penetration is reaching saturation, operators will have to find a new way to keep growing. In some countries, operators will continue pursuing for new clients, and number portability is a new tool that governments are promoting to keep the market competitive. Mexico, Brazil, Colombia and Ecuador will be the first countries to face this new competitive scenario. But, this is not enough in order to keep growing.

In this new scenario, mobile operators are migrating the core of its strategy towards increasing clients spending, particularly in value added services. While there is an idea that mobile voice communications will start replacing fix communications, most operators in the region keep promoting the advantages of using mobile voice communications, especially among users of the same company. In some cases, such as Movistar Argentina, Tigo Colombia or Claro Brazil, the company offers a reduced price per minute for the communications among lines of the same company. On a more aggressive strategy, companies such as Telcel in Mexico, Oi in Brazil or Tigo Colombia offer pre and post paid plans with an amount of free minutes (local or long distance) for any number of the of the same operator. This strategy can be compared with some operators in North America and Western Europe that have unlimited free minutes for calls to lines of the same operator.

In most countries, national regulations set limits to the prices operators can charge the users for interconnection calls. In this sense, operators see more and more interest in increasing data revenues but only at this stage of development two basic conditions to promote data usage are given: the Latin American mobile user is mature enough to take advantage of the mobile data services and mobile content; and secondly, there is a technology capacity and a handset market that support mobile data.

Not every user behaves the same way. Latin America is a mixture of cultures, it can not be expected that the entire region will be interested in the same VAS, however, it is possible to identify some trends that are aligned with international trends.

On one hand we have VAS that are used in everyday life by all kind of users, on the other hand we have VAS that target business users and are originated to increase productivity and support the core business of different industries.

The latest introduction in the mobile VAS market in Latin America is mobile broadband. Operators all over the region are deploying 3.5G networks to boast the adoption of mobile broadband, and along with it, the usage of mobile content, particularly music and games.

What can we expect from Latin America for the years to come? Is young Latin America growing? Certainly, Latin American mobile market has moved into a new stage of its life, it has easily left the childhood years in the past to become a teenager with a great future to come. The region is eager join its older brothers’ in grown up life, however it is up to itself to find its path, other regions experiences can only work as a guide.

By Andrés Sciarrotta, Consultant, Frost & Sullivan Latin America

Cartoon Network will be offering the mobile comics with the telecom operators Airtel, Idea, Reliance Mobile and Tata Docomo. The comics can be downloaded for Rs 1 per day, Rs 10 per week and Rs 30 per month depending on their operator. Nazara Technologies will be handling the management and distribution.

According to a study conducted by Cartoon Network, 63% of kids today make use of mobile phones at least once a week. Observing this, the channel has taken the mobile route to reach its ultimate audience.

Along with the comic application, Cartoon Network would also provide videos, themes, colour logos wallpaper, animation, and greetings on its popular characters. Additionally, the channel is also looking to introduce a customised java application next year to download an entire comic in one go.

Source : Media Mughals

The project, which costs users less than the price of a cup of tea for each three-minute lesson, is being run by the BBC World Service Trust, the international charity arm of the broadcaster. Part of a British government initiative to help develop English skills in Bangladesh, it marks the first time that cellphones have been used as an educational tool on this scale.

Since cellphone services began in Bangladesh just over a decade ago, more than 50 million Bangladeshis have acquired phone connections, including many in remote rural areas. That far outnumbers the 4 million who have Internet access.

English is increasingly seen as a key to economic mobility, especially as ever larger numbers of Bangladeshis go abroad to find work unavailable to them at home. An estimated 6.2 million Bangladeshis work overseas, and their nearly $10 billion in annual remittances represent the country’s second-largest source of foreign exchange.

Well by this time you must have figured out that the ABCD we are talking about here doesn’t mean American Born Confused Desis for sure.

Cellular penetration in India has reached almost saturation level in the metros and urban areas of the country, and there is little room for further growth in these areas. Logically the countryside is where the next phase of growth is coming from and will continue for a long time. These are small towns, villages, and rural areas with a sizeable portion of the population falling under the Bottom of the Pyramid, or low income marginal income population. This is called the ABCD market -the Ayah, Bai, Carpenter, Driver market. They are the ones who are spearing the next phase of growth in the mobile space and naturally VAS should be customized and personalized according to their profiles to achieve mass scale adoption.

Let us now explore the letters A to Z in an alphabetical manner to unearth the various catalysts of the evolving VAS scenario in India:

A: Astrology, AdRBT, AppStores

Astrology
With a market size of more than Rs 40,000 crores, the attraction of prediction is too tempting for operators as well as consumers. The fascination about future coupled with various other factors like match making, etc makes Astrology an integral component of the VAS offerings of many operators. Sub-applications like Horoscopes, Tarot numerology, palmistry, gemstones, soulmates, etc are all offered under the domain of Astrology.

AdRBT
Freebies are always welcome in the Indian market. The future of Ring Back Tone (RBT) is Ad-RBT (Advertisement RBT). This will create different business model by linking together enterprises with operators and enable penetration of RBT to the lowest level of the pyramid. People will get paid for listening to RBT and hosting RBT on their phones as companies will discover new and innovative methods of product/brand promotion and touch points.

AppStores
Future VAS applications will be Innovated, Incubated & Implemented out of
Stores on the lines of App Stores. These will facilitate an ecosystem towards creating an end to end VAS value chain. Various innovative and need based applications would be developed in a short span of time from such labs.

B: Bollywood, Browsing, Blogging

Bollywood
Indians are crazy about Bollywood and are ready to devour content in any means-right from wallpapers, ringtones, games to celebrity gossips and trivia, etc.

Browsing
Mobiles have already replaced computers as the preferred mode of browsing and have a far better reach than the costly PCs. While mobility during browsing attracts the urban people, in the rural areas they offer an economic alternative to the costly computers.

Blogging
With the emergence of micro-blogging sites like Twitter, Indians are happily and constantly blogging on the move. Life has become like twenty-twenty version of the cricket and blogging is also no longer unscathed by it. This makes blogging via mobile phones a way of life rather than a style for the new and modern breed of Indians.

C: Cricket, Content, Comminity

Cricket
We Indians eat live and sleep cricket. We worship cricketers as demi-Gods. Anything related to cricket, count us in. With the emergence of the shorter version of cricket T20 and IPL, revenues from cricket related VAS is a perennial source of income- as operators and franchisees not only make moolah during matches but also after and before the series leveraging merchandise sales, wallpapers, team anthems, etc.

Content
Content is King. The future model of content on mobile will evolve just like content on the web, which is mostly free. This will further warm up the battle for quality content. Applications without compelling and dynamic content will have a limited shelf life while those with engaging content will have a larger appeal.

Community
We always like to bond together in different communities and sub communities where according to our specific interests. VAS will also evolve to address the needs of particular communities based on their areas of relevance. For instance, followers of Baba Ram Dev would be enticed by a VAS application devoted to Yoga or Baba Ram Dev and can use the same to stay in touch with the latest happenings related to this front.

D: Devotion, Dating

Devotion
Indians are God-fearing religious people and we seek blessings in order to be successful in life. Spirituality is a way of our life. Various applications like slokas, muhurats, festivals, tithis are all examples of Devotional VAS.

Dating
With a sizeable chunk of the population in the age group of 15 to 30 years, coupled with the fact that youngsters are early adopters of mobile services, Mobile Dating will take center stage in the days to come. This may be clubbed together with Matrimonial on mobile phones as many people will be using mobile phones as the first source of information for finding their perfect match.

E: Education, Enterprise

Education
Exam results, Vocabulary for competitive exams, and Lessons via Mobiles will not only be embraced by rural India, but also urban students who are always on the move. Many operators have also come out with special packages on different modules and subjects like History, geography, etc. This will enhance the interest of the student community in the so-called insipid subjects and lease a fresh life in the delivery of knowledge.

Enterprise
Seamless connectivity and containing costs while enhancing productivity will drive adoption of various VAS applications among enterprises, specially Micro Small Medium Enterprises. Enterprises may also adopt an MVNO model and come forward for connecting with their stakeholders directly, thus creating a whole gamut of enterprise enabled VAS instead of the traditional Enterprise VAS. Just think about a mobile phone which whose different keypads are configured to address different enterprise needs of a consumer. For eg, when you press 1, you get all the services of a bank like ICICI, when you press 2, you can avail the services of an insurance company like LIC, when you press 3, you get the services of a HUL and so on. This can create a whole new disruptive ecosystem that can change the way enterprises offer VAS today.

F: Fun

Fun
People like to have Fun-on-the Go while waiting in queues, travelling, etc and what better means than the ubiquitous mobile phone with some compelling applications. Operators will gradually come to respect the impatience of youngsters and many such applications will be developed to remove the boredom of people, especially the impatience of youngsters.

G: Gaming, Gambling

Gaming
This is an evergreen field in the domain of VAS. Multiplayer, community based, location based games would be the future driver in this category.

Gambling
Gambling-both legal and illegal are already being played out on the mobile phones. Many tourism destination derive a lot of revenues from gambling This will only increase in the days to come. Various online lotteries can be easily provided on the mobile phones and this will increase frequency of purchase as it will enhance transparency and reduce time and effort to know the outcome.

H: Health, Handsets

Health
Telemedicine has got a shot in the arm, thanks to Mobile Based Health Advisory System. Wellness tips, Fast Aid tricks, BMI tracking, personal monitoring, etc are some of the possible services. Coupled with embedded capabilities, it’s a huge field waiting to be fully exploited.

Handsets
Capability of handsets is a major constraint in the delivery and access of VAS applications. Supporting voice and vernacular VAS is a real challenge, especially for the low-end handsets of the developing world. Operators have to take in cognizance the capability of handsets of the targeted market while developing any VAS application.

I: Infotainment

Infotainment
There is a huge market to be tapped seeking infotainment on the mobile device itself. Information coupled with an entertainment quotient held great value in the domain of VAS. This is especially true in the emerging rural markets where there is an intrinsic propensity to correlate information with entertainment needs.

J:Jokes

Jokes
This would not be a wrong assumption that 1 out of every 3 messages that we send to each other are Jokes. This is the single largest category of VAS in vogue today, even ahead of CRBTs by volumes, if not by revenues.

K: Knowledge

Knowledge
Man’s quest for knowledge is never ending. Via Mobile search engines- voice and text, a large community of consumers will explore the encyclopedia of knowledge available in the public domain.

L: Location Based Services, LIMI

Location Based Services
Location Based VAS such as nearest point of interest along with presence and context will be a niche application that will find acceptance among specific user groups. These will be available at a premium as compared to other VAS. Examples include buddy finder, child tracker.

LIMI (Low Income Marginal Income)
Both the rural and urban populations lying at the bottom of the pyramid will propel the next phase of mobile revolution. Volume and Margin will be competing against each other and new VAS business models will gradually evolve to address this sector.

M:Music, M-Commerce

Music
This is one area where rural India is ahead of its urban counterpart. Music on Mobile is the most popular VAS in rural India, even surpassing CRBTs.

M-Commerce
This will revolutionize the financial sector especially the microfinance sector which will get a boost from better affordability and reach in rural areas. Banking and insurance will also now reach every household in the village. Booking Movies, places at restaurant, hotels, cars, spas, etc will get a fillip with the advent of m-commerce.

N: Networking, News

Networking
Networking with friends and family is on the rise and according to a recent study not only youngsters, but even middle-aged people are taking to it via mobiles in a huge way. Social networking sites like Orkut, Facebook, Myspace are seeing an ever increasing mobile population logging into their websites.

News
News across various categories ranging from sports to entertainment to current affairs are being accessed by people on the go. It’s the age of T20 and people want news relevant to them in sachets instead of an overload of information.

O: Ovi-like Stores

Ovi-like Stores
Ovi-like Stores are the one stop shop for future VAS applications. It is a single gateway to a host of applications based upon the requirements of a particular geography, consumer segment, etc. These stores will be open to developers and content providers to come up with compelling applications backed by rich content.

P: Profile, Packaging, Pricing

Profile
Same size doesn’t fit all-age, region, religion, gender matter. VAS should be customized and relevant for the individual based upon his/her demographics. Also the same individual’s needs are different at different time periods and situations. All these factors must be taken into account while coming out with VAS applications.

Packaging
With proper packaging a simple application can be a killer, while without proper packaging, even the best of applications can be flop

Pricing
New target segments demand new business models and new business models in turn necessitate new pricing models. Sachet-based pricing is the way to go, especially in rural areas.

Q: Quiz

Quiz
Quizzing on mobile can be a very popular application not only among the youngsters but can also serve as a tool for interactive learning in rural areas.

R: Ringtones, Religion, Radio, Rural

Ringtones
Most popular VAS across the globe other than SMS-will evolve more with time.

Religion
Timings of various festivals, chants, slokas, etc all are popular religion based VAS across India

Radio
Radio on Mobile will be the next big thing after FM on Mobile. Radio will also get a new lease of life via this new delivery medium.

Rural
The rural market is the one that is driving cellular penetration now and obviously VAS relevant to them will push up the ARPU

S: Search, Satchet

Search
Search on mobile has the potential to be greater than that on the PCs as both audio and textual search can be provisioned.

Satchet
Different markets call for different pricing models. For the rural market, sachet based pricing is the way to go. Already many operators are testing with Rs1/day schemes on various offerings. This is based on the presumption that everybody does not require the same service everyday.

T: TV on Mobile, Ticketing

TV on Mobile
The single most application which will benefit the maximum from the advent of 3G is TV on Mobile. Various programs, clips, audio-visuals would be tailored according to this platform. TV in many Indian household is a shared object and at times there are quarrels in the house with the remote. TV on mobile will exploit this and garner a sizeable media market.

Ticketing
Ticketing on Mobile will save time and money for both rural and urban consumers. Various enterprises are coming forward with ticketing on mobiles. From Train, Car, Bus and Air tickets to movies, etc can be booked directly from your mobile phone.

U: Utilities, UGC

Utilities
Utility Payments from mobile will enable the middle class people to avoid the hassles of Govt. bureaucrats and long queues.

UGC
User Generated Content will drive the services on mobile to a more personal and customizable level. Content will move towards a free regime.

V: Vernacular, Voice

Vernacular
With a lot of applications for the mass market, applications catering to the rural market, Vernacular interaction and delivery process enabled by transliteration engine on the mobile will be a common thing.

Voice
Voice based VAS is the way to go. This enables more interactivity, engagement and is the most easy and popular means for any service. Voice based IVR is one such example. Voice based system does not advocate any structural learning for the end user to utilize it..

W: Wallpaper, Widgets

Wallpaper
Wallpapers on mobile phones are one of the early VAS applications which gained prominence before the era of CRBT and will always be in demand. Wallpapers are available under multiple categories from movies to sports to animals,etc.

Widgets
Mobile widgets are highly useful web-based apps offering videos, photos, news, games, live sports scores, social networking, and LBS

X: VAS.X

VAS.X
The ‘X’ here stands for Gen “X” ie next generation VAS.2/VAS.3….etc.  SMS 2.0 is one such example . It enables interactive hyper-linking of advertisements etc. In essence, any VAS service which evolves to the next level can be termed as VAS.X. This assumes prime significance as most of the VAS services today are undergoing continuous improvements and are evolving to their next level at a break-neck speed.

Y: Youth-based Applications

Youth based Apps
Youth is the largest consumer of VAS and is also the largest demographic market by number in India. They are the early adopters of such services. No doubt, more than 50% of VAS is built around them.

Z: ZooZoo

ZooZoo
ZooZoo is synonymous with Promotion & Packaging. In order to be successful in the VAS industry, don’t do different things, but do things differently. This means while without the right kind of promotion/packaging even the best of applications may not fly, while with proper promotion/packaging even an ordinary application can be a hit.

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Guest article contributed & CO-authored by  Anup Chakraborty & Amit Mehta of Tata Consultancy Services

Anup Chakraborty is currently working with TCS as Assistant Systems Analyst in the domain of Mobile Value Added Services. He is working with a team of go-getters in enabling an end to end VAS ecosystem within TCS leveraging in-house innovations from various centers of excellence.

Amit Mehta, is currently heading the sales and marketing of the VAS, SDP and Mobility group in TCS, where he was one of the founders members, which evolved, created business case and successfully launched the same

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The key trends in this market have been noted. Presently, mobile voice revenues constitute the largest chunk of mobile operator’s revenues, relegating mobile data revenues to a miniscule percentage. However, the mobile operators have realized that in order to curb depleting ARPUs, they would need to widen their focus on increasing data revenues. In the case of Messaging, the popularity of Peer to Application (P2A) SMS, where mobile subscribers respond to an application such as voting through SMS for a TV program, is on the rise. In terms of Premium Content – Mobile Entertainment segment, it remains the most significant form of mobile VAS across the South Asia and Middle East geographies.

According to Lavanya Palani Batcha, Industry Analyst, ICT Practice, Frost & Sullivan, South Asia and Middle East, “With many markets almost reaching saturation point or having surpassed saturation in terms of mobile subscriptions penetration, telecom service providers are in need to bolster the ARPUs; and mobile VAS has the potential to alleviate this issue of declining ARPUs.”

The regional trend in different countries is equally interesting. India is the fastest growing mobile market in South Asia with good potential for growth amongst the rural population. The mobile VAS market is set to grow at a strong CAGR of 16.6 percent from 2008 to 2015.

Saudi Arabian mobile market has a high mobile penetration. However, the country still witnesses steady year-on-year growth in this sector. VAS market is expected to exhibit CAGR of 10.6 percent between 2008 and 2015.

Sri Lanka has a relatively moderate mobile user penetration of 42.4 percent; hence there is good potential for growth. 3G services such as Video SMS, Dial and Watch TV have been introduced.

UAE has one of the highest mobile subscription penetrations in the South Asia and Middle East region. Both mobile operators, Etisalat and Du, increasing their focus on revenue streams from VAS and mobile TV and mobile internet, have strong potential. Mobile VAS market estimated CAGR of 11.9 percent between 2008 and 2015.

The Egyptian mobile market still possesses a sizeable under-penetrated addressable market, thereby providing avenues for growth. Relatively strong CAGR of 14.1 percent is estimated for the mobile VAS market in Egypt between 2008 and 2015.

Pakistan’s mobile market is robust with intense price wars amongst the local and foreign mobile operators. Estimated mobile VAS market CAGR is 16.8 percent between 2008 and 2015.

The mobile VAS market in South Asia and Middle East is anticipated to exhibit strong to moderate growth owing to untapped potential for VAS in these regions, 3G networks proliferation, and a saturation of revenues, and adoption of plain vanilla mobile voice services. The market is also expected to witness the emergence of stronger mobile VAS content providers/aggregators with the ability to grasp better revenue shares from the mobile operators.

For further information on this study, contact Amrita Nandi/ Nimisha Iyer, Corporate Communications, at amritan@frost.com / niyer@frost.com with your full name, company name, title, telephone number, company e-mail address, company website, city, state, and country. Upon receipt of the above information, a virtual brochure of the report will be sent to you by e-mail.

Emerging mobile functionalities include Mobile Payment, Mobile Gaming, Mobile Healthcare and Mobile Music and adoption of feature-rich handsets pushes mobile advertising and marketing growth

The Mobile Marketing Association, a global organization leading the way in promoting the development and sustainability of mobile marketing, and Solidiance, Asia’s premier marketing & innovation strategy consulting firm, today jointly released a paper on the emerging trends in mobile communications growth in Asia. Titled ‘Asia Mobile Telecommunication Innovations,’ the whitepaper identifies functionality and affordability as the two leading factors driving mobile adoption in Asia.

Affordability has been driven not only by the availability of affordable handsets for low income consumers, but also by lower service prices resulting from highly competitive market places. China, India and Indonesia are the top three markets offering the most affordable handsets in Asia.

With regards to functionality, the market for smartphones has been growing across Asia Pacific. “Undoubtedly, the mobile device is the most personal technology in use today, a fact that presents immense potential for engagement through mobile advertising and marketing. The increase of function-rich smartphones in the market with larger screen size, better web browsing capabilities and longer battery life, combined with ‘all you can eat’ data packages is driving the growth of mobile Internet making it a ready channel to connect with customers,” said Rohit Dadwal, Managing Director, Asia Pacific, Mobile Marketing Association.

The four key emerging mobile functionalities that are driving growth in Asia include mobile payment, mobile gaming, mobile healthcare and mobile music.

“Currently, Singapore and Hong Kong are the most mature electronic payment markets in Asia. The industry is growing rapidly and provides significant opportunities for all electronic payment Channels including mobile platforms. With a focus on services/product innovation, mobile operators and value added services providers are aggressively working on payment options through mobile platforms – which will be the most lucrative segment in the medium term across Asia,” said Damien Duhamel, Managing Director, Solidiance.

Revenues from mobile gaming for the Asia Pacific region have also significantly increased over the past few years. The delivery of advertising within mobile applications (games) creates a new revenue stream for publishers, distributors and service providers. More importantly, the revenue may be used to partially or completely subsidize the price of mobile games/services that the application provides.

Mobile healthcare is another fast growing segment in Asia Pacific. A recent study estimated that the Asian mobile healthcare business is currently growing at 80% year on year. In 2010, this business is estimated to be worth just under USD 1bn with 70% of users in more advanced economies. Applications include remote patient monitoring, mobile nursing, mobile medical records access, access to free mobile healthcare information etc.

“Asia Pacific is the prime testing ground for mobile healthcare. Asia is wired, adopts technologies faster than any other continents, and there are billions of dollars being pumped into the Asia healthcare industry to improve the current infrastructure,” said Mark Lee, Medtech Practice Head – Solidiance

The Asian mobile music market is also seeing rapid growth. Mobile operators in Korea have been the fastest to innovate and capture this market leading to soaring mobile music sales.

On the mobile value added services side, the Asia Pacific region has seen consistent growth in SMS usage. The Philippines remains the SMS capital of the world with the average user sending 400 SMS messages per month.

Early this year, it was estimated that over 2 billion cellphone subscriptions were active in the Asia Pacific region, which is half the global count. The high penetration of mobile devices as compared with personal computers has presented marketers with the opportunity to convert a technology product into a medium for personalized engagement.

“Increasing mobile penetration along with the introduction and adoption of newer mobile technology in the region has made it impossible to ignore the potential of the medium as a marketing vehicle. Research has shown that mobile phone users are receptive to this application of the technology and the increasing use of feature-rich phones further indicates an openness toward using the device for different applications,” Dadwal concluded.