It was not so long back when 3G technology made a quiet entry to India in 2008 with BSNL and MTNL and after three years of political churnings, is today every telecom subscribers's war cry. Every telecom player has tie-ups with VAS players and a large chunk of their revenue comes from them. Most top VAS companies only have 1-2 products that give them 80 per cent of their revenues.
Common applications of 3G include mobile TV, video on demand, video conferencing, tele-medicine and location-based services. A key role in providing 3G-enabled-content to users is played by the value added services (VAS) player which is today a burgeoning Rs 300 crore industry.
Account manager for VAS provider IMImobile Jaishree Naidu explains, "The maximum demand for 3G usage as of now stems from metros and the top five tier II cities. The technology will definitely take almost a year before it moves to cover more areas. 'TV on the go' is definitely one of the primary activities with respect to Vodafone that we focus on whereby we provide live streaming of television channels. While the telecom player like Vodafone promote our applications on their bandwidth, we also check for mobile handset compatibility with the VAS."
Infotainment seems to be the buzzword in the telecom sector what with most telecom players opting for infotainment propelled value added services. Although handset affordability seems to be a major hurdle, VAS players seem to be making the best of 3G technology for now. Jamshed V Rajan, Country Head - India, Nimbuzz says, "I think connecting two or more users over the 3G networks and making them interact over the communication, entertainment, gaming or videos platforms would be the key. With more 3G enabled handsets available at even Rs 5000 and lesser, we don't see handset affordability as an issue."
An area of concern is that most of the handsets that support 3G technology are high-end mobiles and with the recent hike on taxes on mobile handsets this would be an interesting tug of war to look out for. Sebastian Morris from Indian Institute of Management, Ahmedabad (IIMA) who is part of governing body of the Centre for Telecom Policy and Studies answers, "Initially the telecom players would have to under price their 3G applications and create a market for it which might easily take about 3-4 years. A way ahead for 3G might be cross collaborations between telecom players and handset manufacturers to arrive at a feasible pricing. As of now the mobile handset market has only offered stand-alone technology options to their consumers but once those critical price points have been captured then I foresee a huge growth surge for 3G led applications."
Rajiv Hiranandani, co-founder and director of mobile2win says, "We see a surge in user-generated content plying the VAS segment in the future especially in the infotainment segments. We have a video-enabled chat and video on demand applications that stand a good chance of clicking with consumers. A reason for worry is that most telecom operators have paid steep prices for acquiring 3G technology and the kind of a pricing plans they adopt to spur mass adoption by consumers remains to be seen."
The tools to consume 3G are available, now the question is how soon it is made available for consumption and at what long-term price!