What is your assessment of the opportunities in the Indian VAS market?

The telecom sector, one of the most vibrant, adds a whopping over 15 million subscribers every month! Ever since it came into being, because of the dynamics of technology and pace of innovations, mobile telephony has been undergoing a transformation and VAS has been a key driver. It is interesting to see the evolution of VAS. Gone are the days when it meant only SMS and other 2G services. Today it is data intensive and we see a slew of applications ranging from voice SMS to social networking, multimedia sharing, video, maps, location finders, news bytes, etc. This new breed of VAS services would not have been possible but for the introduction of smartphones and 3G. Application stores too have had major impact and it will continue to accelerate. The opportunities going ahead are humongous and are driven by the accelerating adoption of data services, 3G, and smartphones by the Indian consumer.  At the same time, the Telecom Regulatory authority of India (TRAI) has introduced several regulations to limit the overcharging of consumers.

What is the current market size of VAS services in the country? Going forward, say in next five years what is the kind of growth are you hoping to see given the likely uptake of 3G and 4G technologies?

Presently it is estimated to be around Rs120-130 billion which is about 12 to 13 per cent of the operators’ revenue. Going ahead, PricewaterhouseCoopers estimates that mobile VAS has the potential to grow more than four times to generate Rs 555 billion by 2015. While robust 3G and 4G platforms coupled with smarter phones will be key for the growth – and the government’s reforms are piped in that direction – we shall see major uses in the areas of messaging, entertainment, healthcare, agriculture, and banking. Video on demand too shall be a key driver.

While we have seen a dramatic rise in number of subscribers in India, competition has ensured that the average revenue Per User (ARPU) remained on a downward slide. As per reports, ARPUs declined consistently for the top 15 GSM circles between December 2009 till March 2011. Interestingly, VAS is being looked at as the key to turning the ARPUs around.

How does the Indian VAS market compare with global VAS markets?

The  Indian VAS market today is dominated by SMS and voice-based services. In fact, missed call alerts and ring back tone (RBT) are a major part of Indian VAS. We have also seen much traction around cricket, films, astrology and devotion-based services. On the contrary, North America, Europe, and Japan are dominated by data services on smart phones, and these have started catching up in China too.

We find very little missed calls and RBTs in those markets. With the 3G in full swing and 4G in pipeline as well as enhanced customer expectations, we are likely to soon see a transformation in Indian VAS market as well.

What are Kirusa’s VAS offerings and which operators has Kirusa partnered with?

Kirusa is a developer of mobile social media and VAS enabling mobile subscribers to reach out to their family and friends. Kirusa’s solutions include the Kirusa Voice SMS service, which is being used by over 60 million mobile users around the world every month. We also provide an open platform with APIs to enable third parties to offer mobile applications services to mobile subscribers. Kirusa solutions are built on its patented and patent pending technology and its reliable and scalable open multimodal platform.

Our platforms deployed with over 30 carriers spread across 4 continents processed more than 600 million calls in March 2012. Our operators include Airtel, Aircel, Bayan Telecom, Claro, ComCel, Eagle Mobile, Etisalat, Globacom, Grameenphone, Idea Cellular, Loop Mobile, MTN, Tata, Tigo, Uganda Telecom, Vinaphone, Visafone, VIVA, Vodafone, Warid, Yu, and Zong.

How are you placed vis-à-vis your competitors? 

Our impressive list of carriers spread across four continents, robust platforms, millions of satisfied customers and global R&D footprint do us apart from our competition. Kirusa is also driven by a contagious value of passion and a vision to address ever-evolving needs of our customers, which make the company different.

What impact are technologies such as 3G and 4G going to have on VAS?

Technology, it is known, is the greatest enabler in the history of humankind. One of the key changes triggered by 3G and 4G technologies will be the proliferation of smartphones – and this has already begun. The availability of an integrated device with location, camera, WiFi, 3G and/or 4G, cloud storage, along with their excellent user interfaces and ease of download of new applications, is leading to many more innovations, at a pace that is mind boggling.  An average smartphone user has 58 applications on his phone, up from 38 just an year ago. One of the key changes will be the growth of over-the-top (OTT) services.  OTT services are services such as voice calling, text messaging, voice messaging, video calling etc that can be offered by providers other than telecom carriers, using the data connectivity of the smartphones.

The new infrastructure that is enabling the above changes will also see a change of balance of power for VAS – from carriers they would migrate to app stores by Apple, Google, Amazon, Microsoft, Nokia and Samsung.

What are the trends dominating mobile VAS?

So far we have seen voice messaging, cricket, ring tones, devotional aaratis and pujas dominating the Indian mobile VAS space. Globally we have seen data intensive services including messaging, OTT Services, social media, photo and video services, live streaming, m-banking, mapping, cloud storage, desktop class web browsing, mobile payments, and smartphone apps.

What will be the key drivers for mobile VAS?

A robust 3G and 4G regime, smartphone apps, OTT coupled with well-crafted regulatory mechanisms will be key. On how companies including Kirusa innovate and respond to the changing consumers’ needs and dynamics will also be crucial.