Chennai: Watch a few ads on your mobile and download for free ringtones, games or other such. That’s the pitch Chennai- and Los Angeles-based mobile software firm Mobile-Worx Pvt. Ltd is making to India’s more than 210 million mobile phone users, at least those who have phones that can access the Internet.
Downloads of ringtones, usually the latest movie soundtracks, pictures of movie stars and sports personalities that are used as wallpapers, and mobile games mean big money for telcos.
They account for more than half of the value-added services (VAS) that generated Rs2,850 crore in revenues in 2006-07 for firms such as Bharti Airtel Ltd, Idea Cellular Ltd, Vodafone Essar Ltd and Reliance Communications Ltd, according to industry body Internet & Mobile Association of India. Typically, consumers pay Rs5-10 for downloading ringtones and Rs10-15 for wallpapers. That’s too high, said Asif Ali, co-founder and chief technology officer of Mobile-Worx. “The real value of these services is much lower than the perceived value. I think it is unfair that customers have to pay so much for VAS.”
Mobile-Worx plans to offer these services at no charge, but generate revenues from the ads displayed along with the content. It will charge advertisers based on the number of times users see the ads.
“It is very attractive from the end-customer point of view,” said Kunal Bajaj, director, BDA India, a New Delhi-based telecom consulting firm. “But the success of the business model is in creating an integrated ecosystem with advertisers supporting this model.”
Mobile-Worx is betting on growth in the country’s mobile phone user base as well as an increase in the number of people accessing the Internet from their mobile phones. According to Ali, by December 2008, the company will have at least a million users maybe even five million. But its service requires relatively expensive handsets, and users will have to pay a GPRS (general packet radio switching, or data streaming) charge to telcos.
Ali said Mobile-Worx would also try and strike exclusive deals with makers of hit movies to “generate traffic and attract the attention of advertisers.” Mobile-Worx will have to pay for such content. Mobile-Worx is privately held and did not disclose its revenues. The company is privately funded by the promoters themselves.