Mobile value-added service, a billion Dollar industry by 2007

Bangalore, Jan 4 (UNI) The Mobile Value-Added Services (MVAS) industry is likely to emerge as a billion Dollar (Rs 4,560 crore) industry by the year-end from its current size of Rs 2,850 crore, according to a study commissioned by the Internet and Mobile Association of India (IAMAI).

The break up for the current market showed that P2P (person to person) SMS or Text Messaging was dominating with a revenue of Rs 1,140 crore, followed by Ringtones, including Caller Ring Back Tones (CRBT), at Rs 1,026 crore, P2A (Person to Application) and A2P (Application to Person) at Rs 428 crore, Games and Data at Rs 171 crore and others (like MMS) at Rs 86 crore.

The P2P SMS revenue was accrued completely to the telecom operators. The remaining MVAS revenues were distributed among content owners, developers and telecom operators on a revenue sharing basis.

According to the study released here today, in the case of MVAS (except P2P SMS), the revenue sharing arrangement was heavily in favour of telecom operators. This model was significantly different from more developed markets such as China where typically the operators were entitled to 20-30 per cent only. In the case of enterprise solution services, the revenue share arrangement between operator and short code owner was typically 70 per cent and 30 per cent respectively.

Commenting on the study, IAMAI President Dr Subho Ray said ''this is the first attempt at a market estimate for the industry and we are hopeful that the Government and industry will now look at the MVAS industry with the attention that is due to it.'' He said that for the market to grow and come out with innovative solutions, three issues must be set right -- revenue sharing and schedule of payments which was currently heavily in favour of telecom operators, stable and long term enabling policies by the Government and intra-industry issues such as IPR.

UNI