As the 3G mobile telephony comes to India, the VAS of the service providers would go beyond just ARPU and create a market that is cost-conscious. At the same time, many innovative VAS will be brought in. The 3G mobile would create a platform for VAS that no subscriber in India has ever seen.

On major milestones in VAS market growth

Some of the milestones in the growth of VAS were ring-back tones, mobile music, and the advent of customer-needs. In the history of VAS, ring-back tones have been the turning point of VAS in mobiles and have been able to rake up large revenues. Advent of customer-centric VAS is also another point, in which under a package, sending an SMS or ringing a particular number would cost less. As VAS grew in the market, voice-based services required more efforts from the operators and generated more revenues compared to text-based services.

When ring-tones and SMS were considered as contribution to the total services revenue in India, these represented 10 percent with an account of daily downloads of 1 million paid in India and daily 100 million SMS sent. The revenues generated from VAS are growing 30 percent annually in India. Experts say the VAS revenues will contribute 20 percent in next three years.

India's telecom industry has posed unique challenges for mobile operators. MVAS has emerged as a great opportunity to rescue the industry from the declining ARPU. MVAS space is set to witness a high growth trajectory, creating tremendous opportunities. However, stakeholders across the value chain will have to work collaboratively to overcome barriers and create a business ecosystem that generates fair rewards for all the players.

On VAS market in India vis-à-vis other developed countries

The VAS markets in Japan and South Korea are the most developed in the world which are immensely driven by data-based network. North America and Europe come after these two countries and lastly, India holds the third position in the progress of VAS in the world. With the call rate per minute dropping in the country and the cut-throat competition between the service providers, it has proved to be a boon for subscribers whose number is increasing rapidly across the country. Though the US and the European markets are advanced, the growth has actually dipped in these countries.

On Indian subscriber's response to VAS

When the call rates per minute were higher, SMS was very popular. Now that the call rates have dropped, subscribers make more calls and have started demanding innovative VAS which would be content-specific for the users and at the same time be economical. Indian subscribers are using VAS more than anytime before. The Indian telecom market has matured with many competitors struggling for the top spot and many service providers are joining in just to bank on the ever-progressing sector of telecommunications. Many VAS packages like SMS and miss call alerts are some services through which the telecom companies are vying to capture the VAS market.

On response of VAS market as India gears up for 3G mobile

The various companies both domestic and foreign are awaiting approval from Department of Telecommunications to foray into service providers' business. The foreign companies are either joining in as service providers or investing in a domestic existing telecom company. The telecom companies have said that they are ready for wireless broadband or WiMax which could be big revenue generator. But as the 3G mobile telephony comes to India, the VAS of the service providers would go beyond just ARPU and create a market that is cost-conscious. At the same time many innovative VAS will be brought in. The 3G mobile would create a platform for VAS that no subscriber in India has ever seen. The future indeed looks bright for telecom.

On security measures in VAS for banking transactions

m-Commerce in India is still so nascent that the range or bouquet of offerings is yet to evolve. Generally, most constituents in the m-Commerce business are betting on bill payments and ticketing to be the initial drivers of consumer adoption. India is a price sensitive market where consumers want value for money and at the same time get all possible features with guaranteed security over transactions.

To cater to this market Bharti Telesoft is the only provider of the mPayment system where users get an interactive menu-driven interface over USSD, which is very important for emerging markets where high-end handsets are not widely available and easily affordable.

The Indian user is still not comfortable with the idea of giving away his debit or credit card number over the phone. Also, security is a major concern for m-commerce to flourish. There are a number of payment options for people such as check pick up, cash on delivery etc, so the number of people actually paying through cards is not very significant. Security is not a concern technologically; it is just a matter of the mindset that needs to be changed.