Tuesday, December 28, 2010

Spread of 3G telephony to push VAS industry in 2011

NEW DELHI: The spread of 3G mobile telephony will bolster the growth of multi-billion dollar value added services (VAS) market through innovative content and lead to affordable handsets attracting users in both rural and urban areas, says a study.

"The key drivers for the growth of 3G in India will be innovative content, improved customer services and increased affordability of handsets as well as availability of value added services," said global consultancy firm KPMG.

"These drivers will help ensure growth of 3G not just in urban areas but in rural areas as well," it added.

Currently, the VAS market is worth Rs 110-120 billion (Rs 11-12,000 crore), about 10 per cent of the total revenues of the wireless industry.

KPMG said this share is likely to increase to 12-13 per cent during 2011.

It added that the growth would be driven by increasing focus of operators on VAS in view of continuous fall in voice tariffs, greater penetration of feature-rich handsets, spread of vernacular content and increased adoption of applications.

Besides, new areas like m-commerce and m-advertising will gather momentum in the coming years.

KPMG said new technologies and advance of more countries towards 3G and 4G services are providing a clearer path for mobile VAS grow exponentially.

Emerging economies such as China, India, Indonesia, South Africa, Brazil and Russia are expected to increase global VAS revenues, it added.

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