Shambhu Arvind

MVAS Presentation

To a housewife, MVAS is an SMS which enables her to participate in “India’s Got Talent”.

To a student latest music track which he/she uses for his/her ringtone or updating his/her facebook on the go.

For the farmer it is mandi rates which get updated on his mobile.

What is MVAS?

Non core or non Basic

service

Independent in terms of

profitability

No Cannibalization of core service

Framework/Operational

Synergy

Stimulates demand for core service

Commands

Premium Price

Characteristics of VAS definition

Content/App

owner

Content

Aggregator

Technology

Provider

Network Operator

Customer

Handset

manufacture

r

Stakeholders in MVAS

Lucrative for Operators

Customer is Ready• More than 600 million people armed with mobiles want to be entertained/informed/ when they are travelling, waiting or simply living.• And they are willing to pay for it

Host of Hot services

MVAS

MVAS Scope.

Entertainment VAS

• These generate high volume and high usage. E.g. CRBT, Jokes etc.

Information VAS

• These services provide useful services to users. E.g. Stock updates, News, Education.

Commerce VAS

• It involves transactions using mobile phones. E.g. Money transfer.

Types of MVAS

Decrease in ARPU.

Need for differentia

tion.

Increasing need.

Demand from

consumers.

Need of MVAS

(M)VASt future

MVAS Market    

  In Rs. Bn 

Year Amount Y-o-Y change (in %)

2006 28---

2007 46.5 66.1

2008 75.1 61.5

2009 97.6 30

2010 122 25

2011 158.6 30

2012 214.1 35

2013 30

Source: Assocham Financial Pulse

Effective bundling and packaging of services, innovative practices and extension of coverage areas will also augment the market size.

278.3

Saving New Born

• Doctors in Malabar Region of Kerala, quickly access online medical references on mobiles and PDAs for checking drug dosage schedules, indications for the drug and the contra-indications.

Life Saver

• In Tamil Nadu, fisherman are using a new tool: an app which tells them the wave height, wind direction, temperature and the weather forecast called fisher friend mobile.

How MVAS are changing the Landscape?

Rural VAStness

• 3 million people, mostly in rural India, have signed on to Nokia’s Life tools text-messaging information service that delivers commodity prices, weather data and even English education one word a time.

Facebook Mania

• In April 2009, Aircel launched an Ad campaign with MS Dhoni showing how he used Facebook on the move. Result: Uncommon and Electric: User Base in India doubled from under 5 million users to 10 million users of facebook.

How MVAS are changing the Landscape?

Rural VAS can create two basic niches in rural market:

Connectivity: Enables agricultural inputs like Mandi rates, Weather etc. Social welfare networks could go forward in enhancing the life of rural users.

Entertainment: Creating another portal for entertainment starved rural India.

Rural SCOPE of MVAS

…..and it will change every business in INDIA.

3G is here…

Allotted •86.1 MHz•The allotted mobile spectrum using both GSM and CDMA in Delhi Circle.(Population – 31.5 million Mobile users)

Allotted •250 MHz•In UK, the allotted mobile spectrum given to operators. (Population – 10-11 Million Mobile users(London))

In Effect •In effect, 9 Indian mobile phone consumers make do with spectrum available to one UK phone user, explaining the quality.

The Great Indian Spectrum Bazaar

Thus, the applications need to be light (in comparison to foreign developed apps). MVAS needs to have strong sensory and visual appeal to users. MVAS with independent Branding and Appeals are the need of the hour.

2010

2011

2012

2013

2014

2015

0 20 40 60 80 100 120

0.1

1

3.5

10

26

107

Users in Mn.

Users in Mn.

3G Subscriber ProjectionSource: PwC Analysis

India has beaten the projections in mobile telephony and this will happen again. MVAS potential becomes huge once the true picture of 3G comes to the fore.

600+ million mobile subscribers, all potential converts.

Availability of low cost handsets.Lack of availability of broadband services.3G enabled handsets already in market.Young demographic profile of users.Enterprises/Corporate.High VAS usage by other sectors.

Why 3G could fly?

When 3G Flies, MVAS will soar.

2% 3%4%

3%

1%

4%

5%3%

5%

3%

11%35%

21%

Sales Mobile TV

Gaming

Location Based Services

Govt. Services

VoIP/IM

TeleMed/TeleEdu

Enterprise services

Video services

Video Calling

Mobile Commerce

Application Store

Internet Browsing

Music Services

3

Music services

Apps

Mobile Broadband Services of Future

Internet Browsing

Source: Business Today & PwC Analysis

2010 2011 20150

100

200

300

400

500

600

700

800

120

712

265

ARPU (in Rs.)Current Benchmark

Perspective Analysis

With the increase of ARPU after the introduction of 3G, who will benefit the most in monetary terms?

Perspective Analysis contd..

Content/App

owner

Content Aggrega

tor

Technology

Provider

Network Operator

The answer is, the whole ecosystem of MVAS.

In 2009, MVAS were adding 9% to operator’s revenue.

In 2010, estimated contribution would be 12% i.e. 600mn X Rs.120 X 12 = Rs 86400 Crores X 12% = Rs 10368 Crores.

This will hugely increase because another 1 million users would be spending Rs.712 per month after the introduction of 3G in year 2011.

Penetration Opportunity.

Source: PwC Analysis

HUGE

Potential of VAS

Thank You.