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Wireless Utopia

The journey towards a free wireless world.

Mobile VAS Numbers

Wednesday, January 03, 2007

Here are some India specific Mobile VAS numbers: Market Size is around $ 600 Million, expected to grow at around 60 % and reach $ 1 Billion in 2007. The revenue share stands at 60:25:15 for the operator, provider, copyright owner. On the face it looks very promising. But lets get a bit deeper into it.

Assuming that you are a startup operating in this market, and assuming that you have a great product which will outsell others, you'll probably still have around 25 % share of the pie. So you're on target to make $ 60 Million. Thinking realistically, given the number of players in this industry, and the maturity of the consumer base, you'll struggle to reach the 5% mark. That works out to around 10 Million USD. (Also note that the data is from secondary sources!)

Is that enough to play with? Methinks someone has to be big hit in this segment to make a ton of money. Still Mobile VAS startups did attract some attention from the VC's this year. But a closer inspection reveals something else. OnMobile is a Mobile VAS platform provider; so you can count them out. JiGrahak and Paymate happened around the same time and that was largely due to the KPCB factor. That leaves IMIMobile and Mauj. They are hardly startups anymore! On the other hand the Web Startups had a sterling year. Notice that there are no other companies but the Consumer Internet and Mobile VAS one's.

So maybe its time for you give a second thought to that Web 2.0 concept again. Or just forget the numbers and figure out a way get to revenues without help from our VC friends!

Bonus Link: BW's series on Startups. (Hat tip: Puneeth)

Update: Here's Sidhartha's take on the report.

posted by Rajiv, 12:38 AM


the ratio you have given is very interesting. Can you further indicate what kind of VAS we talking about here? Looking at copywright owner I am assuming you are talking about rich media like wallpapers, music etc. Or do you mean something else?

The ratio typically applies to all kinds of VAS products. Typically ratio is dependant upon how you really negotiate with the operator. If you are going through a content aggregator then even they will take some cut out of the ratio. To top it all, you do not really know how much revenue your product has generated since the operators control the billing and can/do fudge the numbers. The losing party is always the one who built the product!
Said Blogger Rajiv, 4:48 AM  

All services beyond standard voice calls and fax transmissions which were provided by Telecommunication companies can be considered as Value Added Services.

Mobile Market in India
Said Blogger Linda, 4:28 AM  

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