Telecom value-added-services industry and on mobile global limited

Abstract

Telecom industry in India has grown at a rapid pace in the last decade in India. With about a million mobile subscribers being added every month to a more than 450 million large subscriber base and growth coming equally from metros and circle A and B cities, Indian telecom has a bright future ahead. The mobile VAS industry, which started from almost zero in late 1990s, has reached a stage where it contributes to 8-10% of the total revenues to the telecom operators. The spread of MVAS has been significant over the years and, if not for customer acquisition, telecom operators have been using MVAS as a way of differentiating their services from competition. Consequently, there have been a substantial number of big and small players who have entered the VAS industry to benefit from the growth that the telecom industry enjoys. OnMobile Global Limited, one of the early starters in the MVAS industry has almost seen a meteoric rise in revenues and subscriber base in the last decade. Although the rapid growth of telecom helped OnMobile to rise to the peak, there were certainly wise decisions at right times, competency developments and differentiations acting into the background that led to the company taking the shape of an industry leader. While the telecom industry has evolved over the years with changing TRAI regulations and increasing competition in the domain, the value-added-services industry has also seen a steep path of evolution with various services and applications being added to the domain and industry dynamics being driven by customer choices and preferences. While VAS players on the hand kept adding applications in entertainment, information and mobile commerce domain to maximize their reach to mobile users, telecom operators on the other hand faced continuous drop in ARPUs, rise in competition and regulations on tariffs hitting their revenue streams. These changes in the industry environment played the pioneering role in the increasing significance of value-added-services and the telecom operators looking at VAS as revenue sources. This project involves a detailed study of how the mobile VAS industry has evolved along with the telecom industry under the impact of the above mentioned changing dynamics and consumer choices. Another major portion of the project deals with how OnMobile, an industry leader and a high-growth company, has evolved with the VAS industry. While talking about the key success factors of the VAS industry, a brief analysis on of how OnMobile has tried to develop competencies to match the industry success factors has been done. Further, a study of the VAS value chain and the recent trends leading to integrations in the value chain has been performed. The last part of the project involves study of some of the interesting changes in the industry like the 3G Auction, mobile portability and others and their probable impact in the VAS industry has been done. A perspective on what lies ahead for the VAS industry in terms of revenue-sharing, market change, integrations across industries and some other major impending changes in VAS and Telecom have been given and recommended strategies for OnMobile have been mentioned to deal with all these industry changes.