MUMBAI: India’s mobile value added service (VAS) market is estimated to grow to US$2 billion by the end of 2008.
A report by Price Waterhouse Coopers shows that mobile VAS in India accounts for 10% of the operator’s revenue and is expected to reach 18% by 2010. T
Globally, there has been phenomenal growth in the market and worldwide spending on mobile VAS, including music, payments and advertising, is forecast to reach US$55.6 billion by 2011.
India has a high proportion of mobile subscribers to total telecom subscribers, driven by the faster wireless rollout, inexpensive handsets and low cost prepaid cards.
Mobile payments, which currently account for 1% of the data services market is set to add 70.9 million users by 2010, but money transfers, driven by lack of banking infrastructure, are a key service need.
The key driver for this growth will be demand from rural and semi-urban areas where a huge gap exists in banking infrastructure.
Mobile wallet is also expected to replace plastic cards (credit cards) in coming years.
Currently, the VAS market is governed by short message services (SMS) - which accounts for 44% of the VAS revenue in India - as well as interactive voice response (IVR) and WAP portal platforms, delivering applications such as entertainment, advertising, gaming and news.
In the coming years, youth will continue to drive the market, particularly in the entertainment mobile VAS.
Spending on mobile music is expected to increase by US$32.2 billion in 2010 compared with US$13.7 billion in 2007.
Similarly, the revenue from mobile gaming is expected to grow, with forecasts of US$9.6 billion in 2011 compared to US$1.8 billion in 2007.
Another area which will see growth is the mobile advertising segment. This is expected to grow consistently to reach US$12.8 billion by 2011, compared to US$2.7 billion in 2008. The growth in this segment will be predominantly due to the rollout of 3G networks, IPTV and high-end gaming in mobile phones.
While the size of mobile advertising in India is small, analysts believe it has the potential to grow at 200% a year, giving operators a new revenue source.
New Zealand Trade and Enterprise (NZTE) is committed to building New Zealand’s profile in India. NZTE’s strategy is to help New Zealand Information and Communication Technology (ICT) companies identify opportunities and build relationships with the key Indian players.
For more information contact Sreedhar V, senior business development manager ICT, NZTE Mumbai.
Contact NZTE’s Mumbai office.