Speaking at MediaNama’s #NAMA conference, Jonathan Bill, Senior Vice President – new product development and innovation, at Vodafone, informed that the company ‘s revenue from off-deck VAS has been more than on-deck services, in less than 4 months of opening them up for product players. He said that India, which is the 3rd largest internet population offers a huge opportunity to product developers, VCs and entrepreneurs. The session was moderated by Kunal Bajaj.
Change in rev-share: Vodafone had also changed the revenue-share arrangement in favour of VAS players and developers to 70:30. Bill reiterated that if the operator plays a major role in distributing the service, it commands a greater revenue share, but if it just supports the development, more on the line of Apple and Google, it would not ask for a major portion. He gave the example of Indiagames, which was recording 1 million downloads per day.
Mouli Raman, MD of OnMobile felt that we have a long way to go and more openness is needed on the development and marketing side. On telcos acting as roadblocks, Bill responded that Vodafone offers operator branded services with a direct to consumer model, where it takes responsibility for marketing and distribution, but it also allows off deck services. Raman said that in India, operators were the best channels for billing, and more importantly, they have a lot of consumer insight which is needed to track their behavior and build new services. He did say that alternate payment methods would evolve in a few years. Bill was also in agreement and cited the low credit/debit card penetration.
On new regulatory changes in VAS: Both felt that there were issues historically, and that the way forward was to give consumers more choice and control but Bill cautioned that we need to be careful not to make the system too complex.
On VAS players losing relevance: Raman responded that one reason for that was that a long term view of the industry was missing, but there’s been a lot of progress in terms of transparency. Raman said that for OnMobile, there was significant opportunity for services that it already offered, which it intends to extend to other channels. He added that the company was also working with large telcos in US to compete with OTT services from the likes of Facebook and Google, which made use of the phone’s native features such as the Phonebook.
Operators’ role: He said that other operators should follow Vodafone’s footsteps and open up the eco-system. He also talked about the time taken in deploying services, which was a major pain point. Bill mentioned that his aim was to reduce the turn-around time from 18-24 months to two weeks. Raman also stressed on the need for cross operator compatibility.
On massification of data service: Bill felt that the latent demand was enormous but the only barriers were price and device availability; though the situation was improving. He said that more local services were needed to generate demand and extend it to non-English speaking population.