Mobile VAS In India - Exec. Summary

Future of Mobile VAS in India Executive Summary December 2007 Mohit S. Gundecha Research Associate Stanford University Prof. Tom Kosnik Fenwick & West Consulting Professor STVP, Stanford University Kunal Bajaj Director – India BDA

Our special thanks to: ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],BDA Team:

The team followed the below process in a very limited timeline, yet was able to gather extensive primary information from industry leaders Research Design Primary Data: Interviewed 23 leading VAS companies, each of the major telecom operators and other industry experts Secondary Data: BDA Database & Reports Why Mobile? Why India? Why Now? Mobile Momentum Sept 15 Sept 30 Oct 15 Oct 30 Nov 15 Nov 30 Stanford & BDA Team Synthesis & Analysis

Leading VAS players in India profiled during project

Table of Contents ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Source: TRAI, COAI, AUSPI, BDA Analysis ,[object Object],[object Object],Interesting Market Facts Indian telecom overview Note: Mobile subs data includes fixed wireless customers Operator Market Share (Oct 2007) 2.67 million (Sept 2007) Broadband Subs 9.22 million (Jun 2007) Internet Subs 217.14 million (Oct 2007) Mobile Subs 39.41 million (Oct 2007 ) Fixed Subs 1.112 billion Population

Market continues to show a trend of over 7 million net subscriber additions in a month Million Micro Prepaid Takes off Launch of 999 scheme Penetration in B & C Circles Verification of subscribers Launch of INR 777 Handsets / Lifetime Prepaid Below INR 500 Record Additions in a month Source: TRAI, Morgan Stanley Research, Telecom Watch, BDA Analysis ,[object Object],[object Object]

Rules of the game Source: BDA Analysis Unprecedented Growth Declining Tariff Declining Handset Prices Innovative Pre-Paid Tariff Plans Improved Regulatory Structure

Over the recent years, most new subscribers being acquired have been low-end users, resulting in falling ARPU Source: Company Information, TRAI, BDA Interview and Analysis ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Mobile ARPUs are Declining Precipitously ARPU (INR) Subscriber (mn)

Operators and handset vendors must adapt their strategies to serve the Bottom of the Pyramid Growth is taking off in semi- urban and rural areas Growth is continuing in metros and urban USO will help continue to drive coverage gains Operators and vendors must adapt their strategies and distribution to meet this new growth Growth is fastest at the Bottom of the Pyramid Source: BDA Analysis

India’s VAS market estimates show aggressive growth and decreasing relative importance of text-based offerings Source: COAI, IAMAI, BDA Analysis ,[object Object],[object Object],[object Object],VAS Performance 2005 2006 Data and Voice Breakup 100% = USD 438 mn USD 678 mn Voice VAS Others E-mail Data Games Voice CRBT / Ringtones SMS (A2P P2A) SMS (P2P)

VAS today comprises of primarily SMS and content focuses on Bollywood & Cricket Source: BDA Analysis ,[object Object],[object Object],Bollywood/Cricket SMS Rural VAS IVR ,[object Object],[object Object],[object Object],[object Object]

The VAS value chain consists of six entities primarily involved in the flow SI/NI Handset Vendor Aggregator Software Developer Technology Enabler Telco Consumer Content / Application Owner Source: BDA Interview and Analysis, Industry Feedback Internet Pipeline Content Flow Process Flow

Network operators dominate the revenue sharing arrangement in VAS today Source: BDA Interview and Analysis, Industry Feedback End User End user pays for the content Operator keeps 60 - 70% of revenue Aggregators get approx 20 - 25 % of revenue Content / Application owners get 10 - 15% of total revenue Network Operator Aggregator Content / Application Owner ,[object Object]

VAS challenges … Operator Challenge Device Challenge Content Localization Challenge ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Value Added Services Source: BDA Analysis User Challenge ,[object Object],[object Object],Revenue Challenge ,[object Object],[object Object]

VAS challenges … Operator Challenge Device Challenge Content Localization Challenge ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Value Added Services Source: BDA Analysis User Challenge ,[object Object],[object Object],Revenue Challenge ,[object Object],[object Object],Revenue Challenge ,[object Object],[object Object],[object Object]

VAS challenges … Operator Challenge Device Challenge Content Localization Challenge ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Value Added Services Source: BDA Analysis User Challenge ,[object Object],[object Object],Revenue Challenge ,[object Object],[object Object],User Challenge ,[object Object],[object Object]

VAS challenges … Operator Challenge Device Challenge ,[object Object],[object Object],[object Object],[object Object],Value Added Services Source: BDA Analysis User Challenge ,[object Object],[object Object],Revenue Challenge ,[object Object],[object Object],Content Localization Challenge ,[object Object],[object Object],Content Localization Challenge ,[object Object],[object Object]

VAS challenges … Device Challenge ,[object Object],[object Object],Value Added Services Source: BDA Analysis User Challenge ,[object Object],[object Object],Revenue Challenge ,[object Object],[object Object],Content Localization Challenge ,[object Object],[object Object],Operator Challenge ,[object Object],[object Object],Operator Challenge ,[object Object],[object Object]

VAS challenges … Value Added Services Source: BDA Analysis User Challenge ,[object Object],[object Object],Revenue Challenge ,[object Object],[object Object],Content Localization Challenge ,[object Object],[object Object],Operator Challenge ,[object Object],[object Object],Device Challenge ,[object Object],[object Object],Device Challenge ,[object Object],[object Object]

VAS challenges – moving on … Value Added Services Source: BDA Analysis Challenge will be overcome Challenge will continue to exist Challenge may be overcome or could continue to exist Revenue Challenge ,[object Object],[object Object],User Challenge ,[object Object],[object Object],Content Localization Challenge ,[object Object],[object Object],Operator Challenge ,[object Object],[object Object],Device Challenge ,[object Object],[object Object]

VAS challenges – moving on … Operator Challenge User Challenge Device Challenge Content Localization Challenge ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Value Added Services Source: BDA Analysis Challenge will be overcome Challenge will continue to exist Challenge may be overcome or could continue to exist Revenue Challenge ,[object Object],[object Object],Revenue Challenge ,[object Object],[object Object]

VAS challenges – moving on … Operator Challenge Device Challenge Content Localization Challenge ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Value Added Services Source: BDA Analysis Challenge will be overcome Challenge will continue to exist Challenge may be overcome or could continue to exist Revenue Challenge ,[object Object],[object Object],User Challenge ,[object Object],[object Object],User Challenge ,[object Object],[object Object]

VAS challenges – moving on … Operator Challenge Device Challenge ,[object Object],[object Object],[object Object],[object Object],Value Added Services Source: BDA Analysis Challenge will be overcome Challenge will continue to exist Challenge may be overcome or could continue to exist Revenue Challenge ,[object Object],[object Object],User Challenge ,[object Object],[object Object],Content Localization Challenge ,[object Object],[object Object],Content Localization Challenge ,[object Object],[object Object],[object Object]

VAS challenges – moving on … Device Challenge ,[object Object],[object Object],Value Added Services Source: BDA Analysis Content Localization Challenge ,[object Object],[object Object],Challenge will be overcome Challenge will continue to exist Challenge may be overcome or could continue to exist Revenue Challenge ,[object Object],[object Object],User Challenge ,[object Object],[object Object],Operator Challenge ,[object Object],[object Object],Operator Challenge ,[object Object],[object Object],[object Object]

VAS challenges – moving on … Value Added Services Source: BDA Analysis Content Localization Challenge ,[object Object],[object Object],Challenge will be overcome Challenge will continue to exist Challenge may be overcome or could continue to exist Revenue Challenge ,[object Object],[object Object],User Challenge ,[object Object],[object Object],Operator Challenge ,[object Object],[object Object],Device Challenge ,[object Object],[object Object],Device Challenge ,[object Object],[object Object],[object Object]

Industry sentiment gives a clear indication where the revenues are likely to come from Source: BDA Interviews and Analysis, Industry Feedback SMS Mobile Commerce Mobile Music UGC/SNC IVR ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],For ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Against Industry Feedback Application

Industry sentiment about internet apps being ported to mobile are mixed, especially given low data enabled handset penetration Source: BDA Interviews and Analysis, Industry Feedback IM E-mail Search LBS ,[object Object],[object Object],[object Object],[object Object],For ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Against Industry Feedback Application

In the medium term most of the current challenges will be addresses by both operators and VAS players… Source: BDA Analysis 2008-09 Trends ,[object Object],[object Object],[object Object],[object Object],Medium Term Growth Driver ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],2006-07 Trends ,[object Object],[object Object],[object Object],2006-07 Trends ,[object Object],[object Object],[object Object]

In the medium term most of the current challenges will be addresses by both operators and VAS players… Source: BDA Analysis Medium Term Growth Driver ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],2006-07 Trends ,[object Object],[object Object],[object Object],2008-09 Trends ,[object Object],[object Object],[object Object],[object Object],2008-09 Trends ,[object Object],[object Object],[object Object],[object Object]

In the medium term most of the current challenges will be addresses by both operators and VAS players… Source: BDA Analysis 2008-09 Trends ,[object Object],[object Object],[object Object],[object Object],2006-07 Trends ,[object Object],[object Object],[object Object],Medium Term Growth Driver ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Medium Term Growth Driver ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

How do the numbers stack up 2007 2010 W-VAS Services Performance Forecast 100%= USD 926.3 mn 100%= USD 2,744 mn VAS Revenues Forecast 2007-10 2004 2005 2009E 2008E 2007E 2006 2010E Revenues (USD mn) VAS as % of Total Rev Source: BDA Analysis 44% Overall CAGR 82% Others 138% E-mail 141% Data 63% Games 82% Voice 18% CRBT / Ringtones 20% SMS (A2P P2A) 26% SMS (P2P) CAGR%

2010 and beyond… 2010 and Beyond Source: BDA Analysis ,[object Object],[object Object],[object Object],[object Object],[object Object]

Contact Details BDA Team Kunal Bajaj Director - India kunal.bajaj@bdaconnect.com Girish Trivedi - Principal Manager Deepshikha Garg, Rahul Gupta Smita Sharma India: +91 11 4700 3100 China: +86 10 8529 6164 [email_address] www.bdaconnect.com Stanford University Team Mohit S. Gundecha Research Associate Stanford Technology Ventures Program [email_address] [email_address] Prof. Tom Kosnik Consulting Professor Stanford Technology Ventures Program kosnik@stanford.edu Full Report Access www.bdaconnect.com/india

Mobile VAS In India - Exec. Summary

Empfohlen

Empfohlen

Weitere ähnliche Inhalte

Was ist angesagt?

Was ist angesagt? (18)

Andere mochten auch

Andere mochten auch (17)

Ähnlich wie Mobile VAS In India - Exec. Summary

Ähnlich wie Mobile VAS In India - Exec. Summary (20)

Kürzlich hochgeladen

Kürzlich hochgeladen (20)

Mobile VAS In India - Exec. Summary