Mobile content providers: having a ball

The Indian mobile market is growing rapidly, and along with it the demand for content and applications for handsets. Shivani Shinde reports

According to the Cellular Operators Association of India (COAI), the mobile subscriber base in GSM and CDMA has grown from 88.48 million in January 2006 to 93 million (GSM 65.2 million, CDMA 27.82 million) in February. As per COAI, the GSM mobile industry holds 77 percent of the total mobile market in India and accounts for 74 percent of additions.

Rising demand for handsets has led operators to offer services other than voice calls. Thus, the content or value-added services (VAS) market comprising music, wallpapers, ringtones and gaming is growing rapidly.

TRAI has put mobile sector revenues at around Rs 25,000 crore for FY05 comprising both voice and data services. These revenues have been growing at a compounded annual rate of 40 percent over the last five years. Revenues from VAS such as SMS, ringtones and ringback tones were about 10 percent of that recorded last year. (Source: TRAI)

With the number of mobile users growing, there is a growing opportunity for content providers. In India, wireless operators, music and film companies, comics content developers, game developers and musicians are all entering the mobile content market for ringtones, gaming, mobile imagery and streaming audio and video. Some players in the content segment are Mauj, Indiagames, Hungama, Soundbuzz (music) and Coruscant Tec.

Growing VAS market

According to Internet and Mobile Association of India (IAMAI), the mobile content market in the country for 2004-05 was worth Rs 558 crore and is expected to reach Rs 1,802 crore by 2007.

Preeti Desai, President, IAMAI says, “The increased interest in and demand for personal expression applications across mobile users is driving the applications and content market. Entertainment and content applications offered by content publishers, aggregators and operators are increasingly central to the revenue and competitive positioning.”

According to Arpita Pal, Principal Consultant, PricewaterhouseCoopers, the content market comprising mobile gaming, ringtones, ringback tones and wallpapers is expected to increase tenfold in the next five years. Pal points out that mobile operators are working towards offering 3G to their subscribers to support content-rich applications.

Though none of the VAS providers is ready to divulge its revenues, there are other indications of their reach and demand: take any reality-based programme on television and you see the use of four-digit numbers for polling.