Opportunities in the Indian Mobile Value Added Services Industry

Opportunities in the Indian Mobile Value Added Services Industry

$250

Additional Information

Length

9 pages

Publisher

Gyan Research and Analytics Pvt. Ltd.

Table of Content

1. Executive Summary……………………………………….. 6
2. Overview of MVAS in India……………………………. 8
3. Indian Mobile Telephony Market Overview ……..10
3.1 Drivers of the Indian Mobile Industry ……………12
3.2 Indian Mobile Phone Subscriber Addition ……..13
3.3 Operator-wise Mobile Subscriber Additions …..14
3.4 Operator-wise Market Share ………………………..15
3.5 Mobile Phone Usage Pattern in Urban India ….16
3.6 Mobile Phone Usage Pattern in Rural India …..16
3.7 SWOT Analysis …………………………………………17
4. Need for MVAS in India ……………………………..18
5. Market Size ………………………………………………20
5.1 Per User Expenditure on MVAS …………………22
5.2 Future Segments of MVAS Revenue Generation……….. 23
6. Market Segmentation ……………………………………………..24
6.1 Components of MVAS delivery Services …………………..24
6.2 Users of MVAS in India …………………………………………25
6.3 MVAS Usage Among Current Mobile Users in
Urban Areas -Sample Study ……………..26
6.3.1 Communication MVAS …………………..26
6.3.2 Information MVAS ……………………..28
6.3.3 M-Commerce …………………………..30
6.3.4 Entertainment VAS …………………….32
7. MVAS Market Structure ……………………34
8. MVAS in Rural India ……………………..35
8.1 Major MVAS Initiatives in Rural India …….36
9. Drivers for MVAS ………………………..38
10. Issues and Challenges …………………..40
11. Key Players ……………………………41
12………………………………………..62

Executive summary

Telecom is one of the most vital indicators of an economy’s health. The Indian mobile telecom industry grew significantly in 2011, with total number of subscribers reaching 730 million. This growth is expected to continue and the number of subscribers is likely to touch 1,434 million by 2016. In 2012, the industry experienced some of the highest monthly subscriber additions with 9.88 million subscribers added in January, followed by 8 million subscribers in March. Till March 2012, Bharti Airtel continued to lead the pack with the highest subscriber additions, closely followed by Idea Cellular.
A change in the country’s telecom regulatory structure has led to intense competition among various players. Further, with constantly declining Average Revenue Per User (ARPUs) along with the saturation of the Indian telecom market, key players are looking at alternative avenues to generate additional revenue. Innovative strategies to acquire market share by increasing both the affordability and the coverage of services are being planned and executed. Key players are climbing up the value chain and creating platforms to enhance the existing content aggregation and commercial model. Among alternative revenue streams to sustain the growth of the industry in the near future, Mobile Value Added Service (MVAS) has apperard as the most promising solution.
A key contributor to the revenue of network operators, the Indian MVAS industry has been experiencing unprecedented growth in the last five years. The MVAS industry market rose by a remarkable 55 percent to reach a value of USD 2600 million in 2010, from USD 1,668 million in 2009; it is estimated to touch USD 4,063 million in 2012. Further, the industry is projected to grow to over USD 7,106 million by 2016, with a year-on-year growth of 15 percent. The industry is primarily being driven by a drop in tariff rates, rise in mobile subscription base, increasing purchasing power of individuals and a growing demand for mobile entertainment and social networking.
Although there has been a considerable drop in the ARPU, the per user spend on valued added services has increased by 28 percent in the last one year. Per user spend on MVAS constitutes approximately 27 percent of the ARPU. Hence, operators need to concentrate on data services such as MVAS and reduce dependency on voice services.
The MVAS market can be broadly classified into four major segments: Communication services, Information services, M-commerce, and Entertainment related MVAS. Out of the four segments, M-commerce and Entertainment have the highest growth potential. The Entertainment segment is expected to have the highest future adoption rate and the largest share in revenue generation. Entertainment services are equally popular in the urban and rural areas; high adoption rates in the rural areas imply a huge potential market. M-commerce services have become extremely popular over the few last years, although the use of such services is restricted to urban areas. As of March 2012, mobile internet users reached 48 million. The segment has been experiencing a growth rate of 17 percent and offers lucrative business opportunities for MVAS players in India.
The MVAS industry is close to saturation in the urban areas. The rural market is where major players should concentrate and look to generate revenues.

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