Mobile VAS innovation slows down due to operator demands for higher revenue?

Telecom Lead India: VAS Asia 2012 has witnessed
debate on revenue sharing issues between Indian telecom operators and Value
Added Service (VAS) players.

Though COAI director general Rajan Mathews demanded
discussion among stake holders, wide spread apprehension about operator demands
for higher revenue share was one of the points discussed during the key note

According to Rajan S Mathews, the exploding cost of
regulation is a critical issue.

Lack of significant incentives for VAS players is
prohibiting VAS players from launching innovative products in India, according
to Hariharan Iyer, country head at Donjin, a leading VAS player.

When AK Bhargava, executive director (Wireless Service),
MTNL, said CRBT (Caller Ringback Tone) was the last innovative
mobile VAS product in India, it stunned several industry head honchos.


According to Bhargava, VAS players could not come out
with revolutionary products after launching CRBT.


According to industry analysts, current telecom market
conditions, the recent TRAI guidelines, lack of RoI for new products and lack
of support from operators are forcing mobile VAS players from launching new and
innovative products.

However, a section of the mobile VAS industry is upbeat
about the growth potential.

The MVAS industry is expected to create a business
opportunity worth around INR 48,000 crore by the year 2015. This in itself is a
clear indication of the future of VAS services in India. No doubt this has
created a new excitement for all those who are in this space and for those who
are entering,” said Shashi Dharan, managing
director, Bharat Exhibitions, organizers of VAS Asia 2012.

For instance, the state-run telecom operator BSNL will be
launching video on demand for its mobile phone subscribers in a month’s time,
according to BSNL Chairman & Managing Director Rakesh K Upadhyay.

All products on the mobile phone are for the masses,
there is a requirement of creative innovation, which should be cost effective
and for masses,” said AK Bhargava, executive director (Wireless Service), MTNL.

  Mobile internet users are expected to surpass the
desktop Internet users 2014. The disparity in the time spent on mobile (10 percent)
and the advertisement spend (1per cent) would also rebalance soon, thereby
boosting revenue from the mobile VAS for the operators. With advertising
revenue rising by at least three times in two years from now this sector will
also bridge the social media and location based marketing with personalization
that was not possible till now,” said Alex Moukas, CEO of Velti.


India’s Internet users penetration will rise to 35
percent by 2015 and more than three quarters will choose mobile phone access,”
said Sukesh Jain, head VAS & Content, Bharti Airtel.

Mobile  VAS has huge revenue potentials, the global
average share of MVAS revenue is leading user countries is pegged at
approximately 23 percent,” said Chandan Ghosh, head – Global Wholesale
& Carrier Business, Aircel.

The opportunity for the technology players to play a
critical role in the further expansion of the Indian VAS Market has become more
crucial now,” said John He, CEO, DONJIN Communication Technology.

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