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Unconventional MVAS - The revenue generator for telecom companies: Vishwanath Alluri, Founder and Executive Chairman, IMImobile

July 09, 2013

Today, consumer mobile value added services (MVAS) has evolved from the traditional SMS-based services to internet-based and application-based services. The advanced services in the consumer MVAS category play an essential role in reaching out to the evolved consumers who is seeking various kind of information on the go.

The VAS system in India is evolving with the advent of technologies like 3G and 4G. Smartphones as device platforms are also playing an essential role. Adoption of services and applications such as live streaming, m-banking, mapping, mobile payments and the like have been possible due to integrated smartphones which use data connectivity supported by 3G and 4G. The development of 3G will provide further impetus to an open innovation model.

A report by IAMAI and IMRB predicted that MVAS will grow by 28 per cent in 2013 and emerging MVAS services will dominate the market.

Modern Consumer MVAS

The modern Indian consumer is on the lookout for mobile value added services in various sectors such as health, education, finance as well as entertainment.

The research findings of a recent report by IAMAI revealed that M-entertainment is the largest contributor to operator MVAS. Furthermore, services in the area of mhealth and meducation are expected to grow.

The combination of mobile and internet helps in increasing the accessibility to services in the field of healthcare. There is unmet market demand in the area of M-health; consumers can be provided health based information by an IVR or an SMS, either by the government or by medical practitioners.

In the area of education, technology is making life simpler for students. Mobile phones are being innovatively used by a few management education institutes who are actively embracing the concept of m-education.

 

A few examples that could be highlighted in the past are how management entrance preparatory tests are being conducted on mobile phones. Mobile applications and mobile learning platform are being developed which not only help students prepare through mock CET tests but also help them understand which colleges are they likely to get admissions in.

Rural MVAS

In addition, to modern MVAS for the urban consumer, rural MVAS is also another area that has immense potential to grow.

The recent data collated by the Cellular Operators Association of India states that three major mobile operators who account for 67 per cent of the sector revenues added 8.61million rural customers combined in the first two months of 2013. This increase is subsequent to mobile phone companies tweaking distribution models and more importantly, providing customised data plans in villages.

The rural areas present a wide scope for the growth of MVAS services in the category of providing information, supporting and educating the farming community. Furthermore, the delivery of services in the space of healthcare, education and banking can also be transformed by the use of mobile phones.

As per a recent Deloitte report on telecommunication prediction, India currently has several different information sharing products through which farmers can access information on agricultural best practices, weather and market pricing via SMS, IVR or call centres. Also various voluntary organizations are working closely with technology companies to come up various region-specific and crop-specific solutions and applications to aid farmers improve productivity. Additionally the report also states through the National Rural Health Mission (NRHM) the government leveraged the use of mobile phones as part of their efforts to reduce maternal mortality rates by 43 per cent.

A few challenges that companies face today in addressing the rural population would be remote locations that are widespread, inability to use SMS due to language limitation, low–end feature phones and availability of affordable data services.

The shift from Consumer MVAS to Enterprise MVAS

Over the past few months, there has been saturation in revenues from the consumer MVAS category due to the directive issued by the governing body. The directive has made it compulsory for the telecom operators to seek permission from subscribers through SMS, email, fax or in writing, within 24 hours of the activation of any VAS, and charge consumers only if they confirmed that they want such services.

Issue of this directive has certainly limited the expansion in the category of consumer MVAS and has encouraged the players to explore other areas of revenue generation such as enterprise MVAS.

Enterprise MVAS is about using the mobile medium within business applications for customer engagement, employee productivity and enterprise mobility.

Given the ubiquity of mobile and large scale presence of social networks, they have become the two most important engagement platforms for enterprises.

Therefore, enterprises today are forced to re-evaluate their approach and change their level and mode of engagement with their customers by embracing social and mobile approach. Cloud comes in to play as it is not only a prerequisite for effective execution of mobile engagement in a virtual environment, but makes unprecedented level of service available affordably to a wide swath of businesses. This technology trinity of Social, Cloud and Mobile (SoCloMo) is slowly changing the way businesses operate.

An increasing number of enterprises, SMEs and SOHOs are in need of a do-it-yourself platform which would bring together SoCloMo within one unified platform so as to reduce dependency on multiple vendors or the financially-demanding internal IT setups.

The market today is highly fragmented with vendors offering point products. To combat the increasing competition and differentiate, enterprises need to adopt an integrated platform for engaging their customers and stakeholders. The availability of different vendors for different technologies and services is an operational overhead which the enterprises should avoid by choosing a well architected, unified platform.

The telecom operators already have access to a rich set of assets such as location, multiple bearer channels, the billing system, and most specifically, rich CRM data. There is plenty of scope for sophisticated segmentation and precise targeting by taking into account behavioral profiles of end consumers. The potential of all these assets has been largely untapped.

Operators may have deployed the so-called Service Delivery Platform but these deployments have, in many cases, failed to fructify.

There has been a dearth of systematic, state-of-the-art platforms that would provide the necessary adapters for the enterprises to quickly integrate into operator networks and expose network capabilities to business customers.

The growth of modern MVAS and the unexplored potential of rural and enterprise MVAS will most certainly make this category a key revenue generator for the service providers.

 

 

 

 

 

 

 

 

 

 

 

 

 

 
 

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