On the move

While scaling up value-added services, mobile service providers are facing the challenge of standing out in the cacophony of voices. How can they be heard with greater clarity?

Eighteen-year-old
Varsha Pillai of Mumbai is the preferred customer for the country's mobile service providers caught in the pincer of heightened competition and the revenue game.

"My mobile phone is my new MP3 player," Pillai exclaims. Her excitement is an upshot of the full-song download opportunity offered by service providers like Hutch, Airtel and Tata Indicom. Pillai's MP3 player is just part of the story.

She adds, "I can also perform puja from my mobile phone." But service providers are realising that as they scale up their interaction with customers through value-added services (VAS), they must increasingly make a difference to catch up with the fickle-minded mobile customers.

Making a difference
In India, VAS contributes to about 7-9 per cent of the total revenues. In markets such as Korea and Japan, its contribution is close to 25-30 per cent, while in Asia-Pacific it's 15 per cent.

Naveen Mishra, senior analyst, telecom, at technology research firm IDC, says, "VAS is a good revenue supplement. But to ensure its effectiveness, service providers need to classify these services as mass and specialised."

Service providers are making their choice. For instance, Tata Indicom, after providing segmentation on its voice portal, is looking at adapting VAS to suit local needs. It's done by providing content in regional languages, which could extend from caller tunes to wallpapers.

Airtel, on the other hand, is attempting to connect to rural and semi-urban areas by providing access to commodity prices through the Airtel Mandi Rate service.

Hemant Sachdev, director, marketing and communication, Bharti Airtel says, "VAS appeals to all consumer segments as it helps them to get information and make a statement about their status, interests and so on."

So, if it's mandis for Airtel, Hutch provides access to e-mails through the Hutch mail service. Naveen Chopra, chief marketing officer, Hutchison Essar, says, "The telecom segment is developing almost everyday. The trick lies in feeling the right pulse."

Reliance made an attempt, by being among the first service providers to connect with parents and students "" it gave them access to view board examination results on cell phones.

Mahesh Prasad, president, applications solutions and content group, Reliance Infocomm, says, "We want to compress vast information on Reliance phones, which will give customers an opportunity to use mobile phones for their everyday needs."

Service providers are also attempting to increase their market depth by offering exclusive services. Sachdev says, "VAS offers an opportunity to interact with customers and create a differential platform."

Thus, Airtel tried to reach out to different segments by providing interactive services through shows such as Kaun Banega Crorepati and Indian Idol. Analysts say it was received well. The numbers too indicate that. Airtel received about 2.5 crore calls and 1.5 crore SMSes in the first 65 episodes of Kaun Banega Crorepati II.

Therefore, if it's about reaching a certain section of society, Tata Indicom offers services such as Faith, where customers can read sayings from the Bhagvad Gita or messages from the Art of Living guru, Sri Sri Ravi Shankar.

"VAS is easily accepted by the youth. Thus, to attract subscribers from all age-groups, we have to look at initiatives like Faith," admits Pankaj Sethi, vice president, value-added services, Tata Teleservices.

Besides exclusive services, music seems to be the popular choice with service providers. Sethi says, "Music will always remain popular with consumers across segments, and these will also help to build a competitive edge."

Thus, after caller-back ring-tones, service providers are looking at full-song downloads. Chopra of Hutchison Essar says, "Customers now have an option of buying a single song of their choice as opposed to the entire album on their cell phone."

This service can be availed at Rs 20-35 per song. Sudhanshu Sarronwala, CEO, Sound Buzz, says, "Mobile music is the key success driver for VAS in India, after SMS."

Calling for attention
With increasing clutter in the VAS marketplace, companies are struggling to stand out. Sethi of Tata Teleservices says, "Communication is a challenge at this stage. As VAS is still a niche product, mass media is not an option."

Thus, many service providers are looking at one-on-one communication through bill inserts, which give details about the new services and SMSes. On the other hand, Tata Indicom, is looking at sachet services to attract its customers.

For instance, on its gaming services, it offers an option of purchasing three games for Rs 5. Hrishi Oberoi, studio head, IndiaGames, a content provider, says, "Indian consumers still face technology inertia and the only solution to this is trial offers and education."

Reliance, for instance, in April 2006, launched its VAS campaign to promote Internet and multimedia services. Reliance Infocomm's Prasad says, "The key is to keep VAS simple, and make it accessible to every section of society." At present, the company's Bas Button Dabao campaign, is launched to educate the uninitiated.

Hutchison Essar's Chopra concludes, "The thought behind VAS is to spell convenience with better offers and more choices." For the moment, Pillai and her friends are not complaining as they look for more initiatives to personalise their mobile phones.