Value Added Services – A Blessing in Disguise to Mobile Industry? (VAS Vs Voice)

By-products are playing a vital role in today’s economy; sugar cane’s by-product molasses generate decent profits then main product sugar. But sugar will never let the Sugar industry into trouble unlike telecom industry, wherein voice based services are being taken over by VAS. India’s leapfrog effect gave fancy mobiles in the hands of more then 121 million people (12 Cr) and currently 6 million mobile users are added every month (March 2007). As per Cellular Operator Association of India (COAI) the total subscriber base in India today is 121 million mobile users, three times more than the traditional landlines subscribers

After the dawn of VoIP technology, it has been predicted that the voice calls (core services provided by Telecom companies) will be free of cost. Apart from being charged for connecting to Public switched telephone network, the VoIP to VoIP voice calls are literally free as of now.

Now, the question is, telecom’s core services (Voice) seems to be in the back seat and new services such as VAS will take the driver seat? Answer to this question is reflected in numbers given below.

Potential of VAS Market, very difficult to find the exact number, my quick web research resulted into these figures


“Revenue from Telecom services to touch $ 33 Billion 2010 and 10% of this will come from VAS
- Size of the VAS Industry
Rs. 2000 Cr (as per Lehman Brothers)
Rs. 2850 Cr “


Another report says, the Total revenue of 6 telecom companies (top six Indian telecom players, Bharti Airtel, Reliance Communications, BSNL, Hutchison Essar, MTNL and Idea Cellular) expected to reach $50 billion from $22 billion (2006-07). The VAS market will be 7 to 10% of the total market.

VAS market is predominately controlled by the Telecom operators, now there are many VAS Services providers who are making inroads into this market. Some of the early bird VAS Services provider include Onmobile, Mauj.com, Hungama Mobile, IMI Mobile, Mobile-2-win – Innovative Mobile Mktg.solutions, India Games, Smart trust, ACL Wireless and Mcheck.


Future: Imagine having complete financial freedom with respect to paying your credit card bills, rent, insurance, telephone bills using your mobile, your mobile will be your virtual wallet. Services provider will offer new things, controlling your home via home tracking/networking, vehicle tracking, TRP Rating Services, High resolution gaming, Localization etc all using Mobile Phones. The above pie diagram is definitely going to add many more slices which will change our day to day life. Recently, ET carried out a survey, and found that, People will not be able to live without mobile. I think over a period of time, it will be Roti, Kapada Aur Mobile.

Some of the good resource on VAS can be found at
brew.qualcomm.com/bnry_brew/pdf/brew_2005/b105_sethi_tatad.pdf
http://www.business%20standard.com/common/storypage.php?autono=283762&leftnm=1&subLeft=0&chkFlg
http://coai.in/
www.iamai.in/mobile.pdf