India ranks second in number of mobile handset use in world, and also the penetration of mobile industry is increasing with dizzying pace. As the number of handsets is increasing, mobile services are also mounting up with similar fashion. A recent report by the Internet and mobile Association of India (IAMAI) has predicted that the Mobile VAS market in India might reach to $13.34 billion (INR 671 billion) by 2015. The value is estimated to be 31% of the total wireless revenue.
VAS stands for value Added Services, especially in Telecommunication industry for non-core services including SMS, MMS, and GPRS. These services are also frequently called as Mobile Value Added Services (MVAS). The value added services are generally being provided by mobile operators, third-party value-added Service Providers (VASP), or by content providers (CP).
IAMAI has also anticipated that mobile data—both on handset and dongles/connected computing devices—would account 54% of the total MVAS market by 2015. In addition to these, non-voice growth of revenue is expected to be 51% of the total augmentation of wireless revenue in 2015.
Founder, Chairman & CEO of IAMAI Mobile—Vishwanath Allu—said, “The operators should realize the need for innovation through collaboration. They should start opening their network assets for business to exploit in order to bring the full value of mobile medium for enhanced productivity, customer engagement, and retention. This can unlock the value of the hitherto dormant assets.”
The VAS in India are quite supportive for entrepreneurs, investors, leaders, students and also for the companies comes under the telecom domain. The value added services have revolutionized the growth of overall telecom sectors. Almost every telecom operator in India is betting big time with such services due to future potential and smartphone explosive growth.
IAMAI president—Dr Subho Ray—mentioned about transactional application, “We have one staring on our face in the form of mobile commerce and mobile money; we need to make it work as it remains a significant long term opportunity. The 2 million plus points of sale of the operators and a progressive regulator and make m-commerce the killer app.”
In Nov 2011, the population of India was 1.21 billion, and the total mobile and internet users were 884.3 million and 121 million respectively. Astoundingly, VAS accounts 7% of the total telecom revenue for Indian mobile operators. For VAS, SMS and Digital Music contribute 55% and 35% revenue respectively. Lack of content localization and shortage of spectrum are the two basic challenges for VAS in India. However, it’s expected that with the introduction of the world’s cheapest Tablet “Aakash”, growing number of mobile manufacturers and accelerated adoption of smartphones might bring more revenue for VAS.