Faced with constant pressure from the value added service (VAS) providers, the Telecom Regulatory Authority of India (Trai) on Wednesday initiated a consultation process to create a revenue share structure between them and the mobile access service providers.
It has been a constant complain of VAS operators that though they provide features like content and other services like ringer tunes etc to mobile operators in the absence of a proper regulatory structure, lose out in terms of revenue to the mobile operators.
Accordingly, Trai has sought to know through a consultation process, approach for the growth, regulatory guidelines and terms and conditions in respect of licencing and provisioning of VAS.
?The telecom operators and VAS providers would need to look at the best practices in other countries and design a fair revenue sharing system where the content providers and content owners do get their due share in a transparent manner,? a Trai statement said.
Trai has sought to discuss revenue share model in mobile value added services value chain and its transparency.
In India the estimated revenue from mobile VAS is over 10-14% of the total revenue of mobile telecom service providers. The VAS have great revenue potential. The mobile revenue through VAS is expected to cross 30% of the mobile telecom service provider?s revenue in the next 5-7 years as revealed in various position papers.
Today SMS constitutes major portion of the VAS revenue. While entertainment services have become popular with the consumers, there remains a scope for utility-based services like location information, mobile commerce for mobile transactions. Trai said that the VAS industry in India is at nascent stage and does not have a proper process or common benchmark or code of practice.
There is no coordinated effort to make the industry grow and it also lacks transparency as the consumers are not fully aware of the nuances of the services.