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Indian operators are struggling for substantial increase in non-voice revenues. VAS revenue for Bharti Airtel, the largest wireless operator in India, was 9% of its total revenue during the last fiscal. The story with CDMA operators, which are known for driving data revenues globally, is also not encouraging in India.

Indian VAS revenue contribution will take at least three to four years to match the global mobile operators' non-voice services revenue that was 15% of their total income in 2008. According to Informa Telecoms, revenues comprising data services of global telcos reached $188.7 bn in 2008, registering 24% increase. Indian mobile VAS revenue is estimated at around Rs 6,000 crore.

Baburajan K

Indian telcos are moving to the rural belt where they face dwindling ARPU. Data will be the main option to sustain their revenue growth here. For this, the VAS ecosystem should be strengthened. Consumers should start getting content beyond Bollywood and cricket. Operators must focus on enterprises besides retail customers. Handhelds should be targeted at enterprises which are on the move. And, enterprises should start deploying at faster pace.

3G launch by BSNL and MTNL is yet to excite subscribers. This is primarily because of poor reach and week content. A research by O2 says, the use of social networking and business applications is driving the usage of converged devices such as iPhones and BlackBerry by small businesses in the UK. O2 sale figures indicate that seven out of ten small businesses are buying smartphones as replacement of their existing handsets. During the recent London tube strike, O2 reported 10% increase in data traffic as customers remotely accessed data, even when they were unable to reach the office. Seamless access of phone services anywhere in India will be a critical component for Indian enterprises to opt for smartphones.

Most of the Indian mobile VAS revenue comes from SMS. Majority of the $188.7 bn of non-voice revenues, globally, are also SMS-based. But there is a shift happening globally. For instance, $75.1bn (40%) of this revenue was from non-SMS services in 2008. New advanced technologies such as HSPA and the demand for data-optimized handhelds such as Apple's iPhone are accelerating the level of non-SMS spend. With an expected increase in the usage of mobile broadband, when India realizes the dream of 3G and WiMax following the spectrum auction, data revenue will shoot up. But this will depend on the efficiency of the ecosystem. India should not lag behind developed nations. A fifth of $192.8 bn revenues generated by North American operators came from non-voice services. In the case of African telcos 5% of $71.1 bn came from VAS. Indian operators should woo enterprises to boost VAS revenue.

baburajank@cybermedia.co.in

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