There are three things mobile operators can do to make VAS a larger component of their revenues and an even greater percentage of their profits.

First, break down the walled garden and open up access to third party content and service providers. Combine this with an offer to do microbilling for them and pay them 60% or more of what the end users pay the operator for the service. This will spur innovation and drive new services the likes of which digital India has not seen before.

Second, think of the mobile and PC as a continuum. The mobile itself has many limitations which are unlikely to go away anytime soon. The two biggest ones are the size of the screen (in comparison to a PC) and the speed of the data pipe (as compared to wireline). So, drive services that transcend both the screens, filling up life’s free and know-now moments on the mobile, and providing an unmatched rich experience on the computer with its big screen and thick pipe.

Finally, drive the creation of connected wireless devices and services with control of the end-to-end experience. Think eReaders for education, connected gaming consoles, netbooks that work on mobile broadband, and more. These are all services that can generate Rs 200 or more in data ARPU each month. This is also where operators can differentiate themselves.

I hope that at least one of the operators thinks along these lines in 2010. Indian customers are happy with cheaper services, but they will be even happier when the mobile phone can become a magic lamp in their lives. Therein lies happiness and profits for the embattled breed of Indian mobile operators.