From offering BSS solutions as well as range of MVAS solutions including mobile messaging solutions, Comverse is betting big on the Indian market. Mr. Pushpendra Mankard, Sr.VP, Comverse shares his thoughts in an interaction with TelecomTiger.

Q1) VAS has been in existence in India for almost 4-5 years. Yet we witness consistent fall in ARPU. It implies that revenues from MVAS are not able to compensate the fall in revenues from conventional voice services. Do you see the situation improving in near future?

Ans: Mobile ARPU is falling in majority of the Asia Pacific markets; the situation is not unique to India. Elsewhere, operators are facing the same business challenge of a rapid decline of ARPU. This can be due to a number of factors, for example, voice is becoming commoditized, reduction in tariffs, the shift in strategy focus of acquiring lower-spending prepaid consumers in a bid to increase market share.

In fact, the Indian telecom industry is one of the fastest growing in the world and India is projected to become second largest telecom market globally by 2010. This has helped the VAS Industry in India to come out of its infancy. Even the global economic slowdown has done – little to affect its growth, this demonstrates the resiliency of the Indian VAS market.

The Indian mobile VAS market has grown by around 60% year on year and is estimated to touch INR 251 billion in FY 2009-10. This trend is expected to increase in future, as VAS services grows exponentially, giving operators a new revenue source. With the onset of 3G and India’s 400 million mobile phone users, we believe that mobile internet and data will be the first major opportunity for 3G operators to grow ARPU. It will thus make mobile internet a significant growth engine for the operators.

Q2) Indian consumers in totality have not shown much interest to VAS apart from few services such as CRBT, content, ringtones and music. What is the main bottleneck for this?

Ans: Indian consumers are in a phase of transformation from using basic telephony services to high end value added services.

In India, we see music and film companies, cartoon artists, game makers and musicians all aggressively entering the mobile content market for ring tones, gaming, mobile imagery and streaming audio and video. Service providers in India have positioned mobile services as game changers in attracting and retaining subscribers. The popularity of these entertainment type of VAS is still likely to continue and driven by the youth segment. Other value added services  may however take a little while to encompass the Indian market. Fuelled by the rollout of 3G networks, mobile advertising will be one VAS to watch for.

Q3) Currently it is observed that VAS enablers like you either work together with handset manufacturers or directly with operators when the situation demands all the  parties to jointly work together to bring about a comprehensive end-to-end delivery of services.

Ans: An example of this sort of partnership is the launch of Comverse visual voicemail on Blackberry smartphones earlier this year. The Comverse Visual Voicemail solution delivers all messages to a BlackBerry’s inbox, complete with each voicemail’s date, time and length, as well as each caller’s phone number and identity if available. Listening to messages and returning phone calls are as simple as clicking on the message.

While the user can take pleasure in a true visual voicemail experience to save money and time, service providers can benefit from a boost in customer satisfaction, as well as enjoy increases in voicemail usage and penetration in key consumer and business segments.

We have also worked with a Hong Kong operator to launch Hong Kong’s first visual voicemail service. The service is available on the iPhone 3G.Not only does the service enhances the users’ experience, but it also generated additional revenues for the operator.

Q4) Do you see the Indian MVAS sector picking up post entry of 3G services? Trends from BSNL and MTNL negate this belief.

Ans: Though 3G enrollments by MTNL & BSNL have not shown very high results in India todate, however, with the private players stepping in, we can expect a rise in the use of far more VAS than what it is now.

As mentioned, 3G and India’s large base of mobile phone users, mobile internet and data will be the first major opportunity for 3G operators to grow ARPU. It will thus make mobile internet a significant growth engine for the operators. There is expected to be an increase in the share of non-voice services including data card access & SMS. The ARPU from these services is anticipated to rise from 9% to nearly 23%.