Indian Mobile Operators - $1 Billion Left on Table?

A report by Strategy Analytics advises established Indian mobile operators to avoid the risk of missing out on the US$1 billion in value-added service revenues predicted for 2012, if they continue to focus their efforts on gaining new subscribers, without responding to the requirements of the MVAS market.

At present, ringtones and caller ringback tones account for two-thirds of the MVAS mix, but their growth is slowing. Building a healthy market for newer offerings, like mobile TV, video on demand, music and games will require a thriving content development community, lower data tariffs and extensive service marketing and user education.

"So far, mobile operators seem more focused on the race to gain new voice subscribers than they are on building a solid MVAS ecosystem. This may prove short-sighted," says Rahul Gupta, Senior Analyst in EMCS and principal author of the report. With operators retaining 60-80% of end user MVAS spending, many content providers express reluctance to invest in new product development, and some are starting to investigate off-deck delivery.

The pace of 3G deployment is expected to accelerate in 2009, and along with it the ability to deliver advanced services. According to Tom Elliott, Director of EMCS, "The question is whether traditional operators will reap the benefit or if creative new entrants, like Virgin Mobile and their partner, Tata Teleservices, will profit."

Posted to the site on 13th January 2009