One should not forget to target the mass market apart from the business sector as discussed above. Simple applications like e-mail, SMS and simple SMS-based applications with local cultural touch to the content will drive home significant revenues(17 to 18% of the total revenues or even more) when voice ARPU comes under strain. This is because the entry of lower usage segments in the mobile market will result in lower average minutes of use per subscriber. Ultimately, in the longer run, mobile services & applications have to be given the status of FMCG and mass market appeal will be the key to success. Mass-market consumer applications will be much more diverse and difficult to predict. However, the time seems to be right to push for mass market acceptance of m-commerce because the telecom markets have shown a healthy trend with the lowest subscriber potential regions classified as "C" circles growing by 163 percent during the period from April 2000-April 2001. The subscriber base in circle "A" and "B" has grown by 100 percent and 98 percent respectively, while the metros have shown a growth of 71.4 percent. Moreover, people in metros as well as a major part of circles are becoming familiar with the idea that the same product can be purchased via a variety of media.

Thus, m-commerce appears to have the maximum potential to provide fresh revenue streams. This is because it is only obliquely "paid for" by customers, yet offers significant benefits in terms of convenience, time-saving and ease of use. In addition, m-commerce encompasses all aspects of retail, transactions, banking and cross-corporate activity, so it is likely to appeal to almost everyone who owns a mobile terminal. Consider one’s income and how he spends it. Then estimate what percentage of that spending might be transferred to m-commerce. It does not have to be large items—cinema tickets, parking, petrol, and restaurant bills are all possibilities. Then assume the operator gets a percentage of that annual figure. It is clear the operator’(s) cut does not have to be large for the revenue to be substantial (revenue uplift of 20 to 25 percent in metros and 10 to 15 percent in circles are expected in the longer run). For m-commerce to fulfil its potential, it needs to be easy to use and inspire confidence. As far as network planning is concerned, the m-commerce proposition involves the transmission of minor amounts of data and because of their small size, the impact on the network is small.

Hundreds of transactions are equivalent to one medium-sized file transfer and because of a reasonable level of excess capacity (20 to 30 percent) associated with the well-planned network, there is plenty of space to accommodate such activity. The immediacy of purchase choice that mobility brings, specially when combined with the always –on the nature of link- will support and encourage the impulse buying of content when on the move. Push-based m-advertising will also be important. Especially in cases like offering last minute flight offers to those in the vicinity of an airport, sales notices near shops and special occasion services for birthdays and anniversaries. Operators have to ensure the matching of content with delivery.

Apart from e-mail, SMS and simple SMS-based applications as indicated above, most projected application portfolios might also include fast Internet access, entertainment and gaming etc. This means network considerations must be brought to the fore, since all these applications will require high data rates. They also need to be offered right across the network. Operators need to think about the timing of such offers and whether it will be possible to generate sufficient volume of revenue from a limited range of highly targeted applications. Another important consideration is the influence and management of customer expectations. The right balance needs to be maintained right from day one of the commercial launch of cellular services.

Building Strategic Alliances

A strong relationship and partnership has to exist between an operator, vendor, application developers, and the independent companies that write applications. One of the main drivers for the evolution of attractive applications could be the input from third party developers. The operator has to provide the delivery mechanism and a reasonable number of aggressive and tech-savy small and medium sized application companies located at Pune, Hyderabad, Bangalore, etc., will supply the ideas that will capture the public imagination. By welcoming the Internet community and encouraging third party IT–enabled application development, operators can encourage innovation and inspire the market. This in turn will help drive home sustained revenue stream earnings both for the operator and small and medium-sized application companies as mentioned above. Planning for key differentiating products and services amounts to planning for gold.

Let us fire our imagination.

Ved Prakash Singh is vice president, engineering and operations, Birla AT&T Communications Ltd