With walled gardens and high retained shares, operators in India have kept the Value Added Services (VAS) revenues largely to themselves. VAS in India (excluding P2P SMS) has grown to over a billion dollars in revenue. Only about 20% of that flows through to the VAS companies.
Operators have faced little or no competition here from off-deck services because of the ability of VAS companies to do their own billing. What if that where to change? What if companies could create an independent payment collection capability combined with an open publishing platform?
Such an entity (what I call a Digital Services Operator) would be able to inject competition into the VAS space. More importantly, it could also drive innovation and the creation of new services — and truly make the mobile a magic lamp in the hands of consumers.
So, the Indian mobile space will continue to be exciting — the coming disruptions will open up the field to innovation across the board. Operators will need to think smart on how to retain their existing subscribers and acquire new ones, while VAS companies will reap benefits from higher network speeds and more open access to the mobile subscribers. 2010 promises to be an exciting year!