Management consulting firm, Zinnov, released a study on Tuesday that evaluates the Indian telecom market for 2012. Titled "Indian Telecom Market Overview 2012", the study covers the overall industry growth, key technology trends, and government regulations that have shaped the growth of the Indian telecom sector.
According to the study, the Indian mobile value-added services (MVAS) market is expected to move from the traditional SMS-based services to Internet-based and application-based services. Currently valued at over US$5 billion, Indian MVAS industry is expected to reach well over US$6 billion by 2013.
The Indian telecom industry has witnessed a three-fold increase in subscribers since 2008. The wireless subscriber market stands at 933.7 million subscribers, with Bharti Airtel as the market leader, while the wireline segment stands at 31.4 million connections, with state-run BSNL dominating the market.
Although the Indian market is characterized by a large subscriber base and substantial tele-density, the average revenue per user (ARPU) is quite low. The report then goes on to highlight new avenues for revenue generation for the telecom companies, like mobile VAS (MVAS), cloud and datacenter services, which in turn are providing ample opportunities to IT companies.
At present, the data center market and capacity in India is valued at over US$4 billion and is expected to reach around US$6 billion by 2014. Nearly a fifth of this segment is governed by third-party service providers while the rest is captive. Captive data centers in India face challenges like a lack of in-house skills, high investments, and long gestation periods.
The declining share of voice in ARPUs has necessitated a focus on MVAS opportunities. The report highlights the following MVAS categories:
M- health: Leading telcos such as Vodafone, Airtel and Aircel are partnering healthcare companies to deliver m-health services. Typical m-health services include provision of locating hospitals, fixing appointments, registration of patients, getting medical advice, facilitating treatment, and seeking blood donation.
M- governance: Many Indian states such as Kerala, Gujarat, Bihar, Goa and Andhra Pradesh have initiated m-governance practices primarily through SMS-based platform.
M-education: Major telecom players are enabling mobile as a platform for imparting education. For instance, Aircel and MTS are partnering NGOs for educational initiatives aimed at underprivileged children. Reliance Communications is delivering interactive, real-time courses across 105 cities. Airtel is imparting education through IVR (interactive voice responde) which includes English-speaking courses at basic level.
M-commerce: Telecom carriers are increasingly taking interest in m-commerce services. Reforms are encouraging telcos to offer services such as m-microfinance, m-retailing, and mobile-wallet services. Some of the recent government initiatives include increasing mobile payment limit to INR 50,000 (US$901.8) by RBI, and the creation of Interbank Mobile Payment Service (IMPS).
M- agriculture: These services bridge the information gap between farmers and market conditions. Key services include commodity prices, local info, weather updates, multiple language support, and so on. Reliance communication provides its service, called Grameen VAS, while Airtel has a service it named, Bahtar Zindagi, for the rural farmer.
M-infotainment: Almost all leading telecom companies provide information and entertainment-related services. Infotainment is the largest contributor to overall MVAS revenue. This segment covers categories such as sports, travel, news, ringtones, music, and videos.