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@IAMAI MVAS: Consumer Segments & Content; Ad-Funding vs Ad-Subsidized


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MultiModal Access And Consumer Segments
In the session on Enterprise Mobility, responding to a question on consumer services, Rajesh Jain, MD of MyToday said that there will be multimodal access on the mobile channel, and companies need to move more and more content to the cloud. There’s a whole category of user base, which is using the PC, and would like more and more of these services on the mobile. There’s a tremendous opportunity for VAS providers and for media companies, and make it available through multiple channels. Sometimes when on travel, I don’t have access to GPRS, I use SMS.

Zubin Dubash, GM VAS for Tata Telesevices said that there needs to be a reality check on what the consumer needs; VAS consumers can be categorized as follows:
— Prepaid customers, which are around 85 percent of the market. Their spends on mobile are limited to a certain amount. Though the entertainment requirements of the current customer are adequate, his affordability need to manage his capacity to spend, and him content in sachets. The existing prepaid customer wants music, but has only Rs. 5 on a prepaid account. For him, we have to give a CRBT for just 5 days. Services need to be in sync with his affordability. He doesn’t look at entertainment as his first need.
— The evolved customer who is hungry for information and entertainment services, who says give me more, and I’ll pay for it. An evolved customer wants location based services, is a serious casual gamer, wants full track download.
— Lastly we have the rural segment, which is going to be 40 percent of the next 250 million. What entertainment can we offer to these guys? Let’s take music as an example. For the rural customer, their phones are without screens, so how do you offer them music? The only way is to offer them something on the server side – like Caller Ringback Tone. Another example is a service we piloted in Tamil Nadu called the fisher friend application, addressing needs of the rural fisher folk, like weather information, when to go, good cachment areas, prices of fish. All of which has a direct impact on his income. We will be rolling this out shortly.

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Ad Funding vs Ad Subsidised
Smita from Pricewaterhouse Coopers asked about whether advertising can replace the “consumer pays” model. Dubash agreed that for them VAS is currently subscription led. Mobile advertising is at a very nascent stage…and I don’t see it hapenning for the next couple of years, at least. The way the operator looks at it is – if today the service is for Rs. 10, and an advertiser can pay Rs. 12 for it – I’m on. But if I’m still only going to get Rs. 2 for it, then I need to get that extra 10 from somewhere. I don’t see that switch happening.
Raj Singh, MD of Activemedia, added that the amount of money being made from charging consumers is multiples of what is being made from advertising, so ad-subsidization is what we can look at. Ad Funding itself take a long time.
Salil Bhargava, CEO of Jump Games agreed, saying that revenue from sales is so much higher – It’s expensive to create content, and advertiser isn’t willing to pay. The cost of porting, the time taken to port is significant. What will make the operator host the content for free? It’s very very far away.
AR Vishwanath, Chairman & CEO of IMI Mobile suggested that content might be given free as incentive for other serivces – like a bank in the UK which offered full track downloads for new signups. A representative from ICICI Bank agreed, saying if banks can offer conceigre services, why not music? ICICI had given away free music CDs in rural India, and it worked out very well.
@IAMAI MVAS Conference – Our Complete Coverage
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“Opportunity for a bank to become an MVNO” – Ravi Shankar of Yes Bank
Consumer Segments & Content; Ad-Funding vs Ad-Subsidized

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