Mobile VAS to contribute 31% of Wireless Revenues by 2015: IAMAI Study

Mobile VAS has the potential to become an INR 671 bn market by 2015 contributing to 31% of overall wireless revenues. This growth will be driven mainly by mobile data (both on handsets and dongles / connected computing devices) contributing 54% of the overall MVAS market by 2015. Non-voice revenues are expected to grow to contribute 51% to overall incremental wireless revenues in 2015, according to the IAMAI'Analysys Mason Vision Document on Mobile VAS.

The report was released earlier today by Sachin Pilot, Minister of Communications and IT, Government of India in New Delhi.

Releasing the report, the Minister mentioned that the mobile value added services was miniscule at present in comparison to its potential and the government would make appropriate efforts to put the industry on an equitable and sustainable growth path. However, in order for the industry to be a success, he suggested that service providers should provide locally relevant services in local languages. He also mentioned that the digital industry should change its perspective from "internet users" to "internet beneficiaries .He explained that if we are not able to provide tangible benefits to people, adoption of internet would continue to be low. He added that the digital industry should find out the best and most effective ways of utilizing the infrastructure that the government is creating through optic fibre network, UIDAI etc.

The report has been developed after detailed discussions with over 50 players across the telecommunications industry, including leading operators, technology platforms, OEMs and VAS players. Mobile VAS revenues form a large part of carrier revenues globally, in both developed and emerging markets. In India too, multiple trends indicate an inflexion point for the MVAS industry in the near future. In addition to the direct revenue impact, the industry is also expected to have widespread secondary impact on entrepreneurship and innovation in India. The report also stresses on the need for policy enablers and market mechanisms taking necessary steps to address the current growth limitations in the sector, both from an on-deck as well as an off-deck perspective.

Speaking about the IAMAI-Analysys Mason Vision Document on Mobile VAS, Dr. Subho Ray, President ' IAMAI said "This is the first ever study in India which charts the evolution of the mobile value added services industry, maps the future growth potential and makes practical suggestions on what needs to be done by various stakeholders to set this industry on a "take off" mode. We are confident that this will become the industry's guide for the next 10 years."

Kunal Bajaj, Partner and Director India, Analysys Mason, stated, "Carriers are under tremendous pressure from competition and declining ARPUs, leading to stunted revenue growth. Based on recent trends in the sector, now is the right time for them to increase focus on the VAS space to find new opportunities for differentiation and earnings."