Telecom services market likely to grow 28% to reach Rs 26,000cr

New Delhi: The market for telecom services, including texts and ring tones, is expected to grow 28% to reach Rs 26,000 crore by the end of 2012, according to a report by the Internet and Mobile Association of India (IAMAI) and the Indian Market Research Bureau (IMRB).

The so-called mobile value-added services (MVAS) market, which was valued at Rs 19,700 crore in 2011, has been boosted by declining costs for accessing data on mobile phones and greater availability of low-priced mobile devices.

Even though conventional MVAS services comprising mostly of entertainment and text-based services continue to dominate the market with a 63% share, applications with enhanced content and higher data usage, such as games, have garnered a 37% market share and are set to be the most sought-after services in the future.

Music downloads and ringtones are currently the most popular services among Indian users. The rate of adoption of MVAS has outpaced the growth of new mobile subscribers, according to the report. Consequently, a subscriber spent an average Rs 24 a month in 2012 compared with Rs 15 about three years ago, according to the report.

Industry executives say the diversity in content is driving growth for this market, making the mobile device more and more user centric. Atul Satija, managing director and vice-president (Japan and Asia-Pacific) of Inmobi, a mobile advertising network, said “more content is always good. It allows people to spend more time on mobile, which leads to a greater shift in spends from the advertiser’s end.”

Shubhodip Pal, country manager at Blyk, a UK-based mobile media?firm, said, “This just shows us that we are now clearly moving away from the mobile to be just a basic phone-centric device to a more user-centric device where one can do more.”