Mobile Value Added Services - India

April 2009
Executive Summary

Estimated worth INR XX mn in 2008; expected to grow to INR YY mn in 2011
Market
Value added services (VAS) accounts for a% of operators revenue

Services offered can be categorized into information, entertainment and M commerce
Drivers: Challenges:

Demand Side
Supply Side
Biased revenue sharing model
– Increasing consumer – Declining ARPUs
Lack of copyright protection and

E
Drivers & demand for VAS – Rising mobile teledensity

L
authentications standards
Challenges – Medium for advertising – Introduction of 3G based

P

Dominance of pre-paid customers
– Demand for regional applications
content
Lack of consumer awareness

Trends S M
– Growing rural market

A

Increased focus of PE/VC firms

Growth in demand for mobile music and gaming

Lack of purchase of feature rich handsets

Partnerships between mobile manufactures/ operators & MVAS players

Growth via acquisitions

Strong demand from corporates for enterprise VAS

A highly fragmented market with many small and medium sized companies
Domestic Players Foreign Players Content Technology
Aggregator
Provider/Creator Enabler
Competition • A •X
•B •Y •X •Y •Z
•C •Z •U •V •W
•A •B •C

MOBILE VALUE ADDED SERVICES - INDIA.PPT 2

• Introduction
• Market Overview
• Drivers & Challenges
• Trends
• Future Outlook
• Competition
• Key Developments

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 Indian Telecom Market has been growing with rapid increase in
CDMA and GSM mobile subscribers
Overview Mobile Subscribers (2008)
•Total Revenue mn

2008 – USD XX bn GSM E
200
•Total Subscribers – U mn (2008) 150 CDMA
D

E

Fixed Subscribers - V mn 100 C Y

Mobile Subscribers - W mn
•Tele-density: a% (March 2008)
PL 50
0
A
U
B
V W
X

•Projections:

SAM

Total revenues to increase to USD YY bn by
2012
2004 2005 2006

Wireless Operators Market Share (Mar’ 09)

2007 2008

Company 1

Tele-density of the country to go up to b% a%
by end of fiscal year 2009-10 g% Company 2
Company 3

X mn mobile connections by 2012
b% Company 4

Y mn GSM subscribers by the end of 2009 Company 5
f%
Company 6
e% c%
Company 7
d%

Source:

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 Mobile Value Added Services market is growing strongly with
demand for entertainment services dominating the market
Overview Data and Voice Break-up
• Mobile VAS market is worth INR XX bn in 2008 and is Data
Share of data
forecast to reach INR YY bn in 2011 Voice revenue is increasing
• Mobile VAS accounts for a% of mobile operator’s 100% u% v% w% x% y%
revenues
80%
• Mobile VAS can be categorised as –

L
bank account balance/transaction alerts etc.

P E

Information - News alerts, stock prices, air/rail ticket status,

Entertainment - Songs, ringtones, caller ring-back tones

(CRBTs), wallpapers, games, jokes etc.
60%
40%
20%
a% b% c% d% e%

M
0%

M-Commerce - M-payment, M-banking etc. 2004 2005 2006 2007 2008

Market Segmentation
2004 SA Video/TV
Ringtones/
MVAS Market Size & Growth
INR bn
200
SMS VAS
Non-SMS VAS
2005 E
Graphics
2006 Music 150 a% D
y%
2007 Information C
100 x%
Services
B w%
2008(e) Games A
50 v% d%
u% c%
2009(e) Segment X to b% b%
a%
witness highest 0
0% 20% 40% 60% 80% 100% growth 2007 2008 2009(e) 2010(e) 2011(e)
Source:

MOBILE VALUE ADDED SERVICES - INDIA.PPT 5

Drivers

Increasing Consumer Growing Medium for Increase in Demand

Growing Rural Market
Demand for VAS Advertising for Regional Content

Demand Side

Drivers

Supply Side

Rising Mobile Tele- Introduction of 3G

Declining ARPU
Density Based Applications

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Challenges

Biased Revenue
Sharing Model

Feature Rich
Handsets beyond Lack of Awareness
the Buying Power among Consumers
of Users

Challenges

Lack of Copyright
Protection and Dominance of
Authentications Prepaid Customers
Standards

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Key Trends

Increased Focus of PE/VC

Firms

Strong Demand from

Growth in Demand for
Corporate for Enterprise
Mobile Music and Gaming
VAS
Trends

Partnerships between
Growth via Acquisitions Mobile Manufactures/
Operators & MVAS Players

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 Introduction of A and the growth in demand for B will boost the
market
Introduction of 3G
Technology
• Auction for 3G is
expected to take
place in FY 20-- - --
• Will boost mobile
broadband
penetration as it will
allow for high speed
data transfer
a% of subscribers (approx. X mn)
using high-end phones can be
SAMPLE
targeted
Source:
MOBILE VALUE ADDED SERVICES - INDIA.PPT
Top Applications in 2008
Change in revenue model
U
V
W
• Operators share
X expected to decline
Z to b%
• Other players across
the value chain
Top Applications in 2010 accounting for
almost c%, as
U compared to a%
V currently
X
B
C MVAS is expected to account for
x% of operator’s revenues by 20--
9
 A highly competitive market with players constantly developing
services to capture market share
Overview Market Share
•The market is highly fragmented with a large
number of domestic players

There are more that X companies registered with Company 1
the Internet and Mobile Association of India a%
(IMAI) as VAS enterprises

LE
•Many domestic players have also presence in
the international markets
P
b%
Company 2

SAM

Company Y has presence in more than A countries
with a% of revenues from overseas

Company Z services are available in USA, Ireland,
UK, Spain, South Africa, UAE, Sri Lanka and Others
d%
c% Company 3

Singapore
•Foreign players have also entered the
domestic market to capitalize on the profit
incentives
•Major players

Domestic – Company 1, Company 2, Company 3

Foreign – Company 4, Company 5, Company 6

Source:

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