4G Inconsequential For VAS Uptake

The launch of 4G services earlier this month has failed to captivate the Indian Mobile Value Added Services (MVAS) players. (See India Welcomes 4G Services, Bharti 4G Launch: What It Means For RIL and Bharti's 4G: Not Yet For Mainstream Customer.)

"It is still early days for 4G in India. As we have seen in the case of 3G, we havent had the kind of take off by the consumers as was expected," says Abhishek Pathak, regional head of mobile marketing at One97 Communications.

Absence of 4G ecosystem appears to be a prime factor behind this lack of interest in this new technology. A considerable part of the Indian geography still struggles for basic mobile connectivity. Even in metros, almost all of us have had a tough time talking on the phone, while on a flyover or in the basement of a building, and we have started shouting about 4G. At best, in the short run, it will be a marketing gimmick," adds Pathak.

Experts, however, believe that the 4G launch will eventually lead to declining tariffs in 3G, that will build the case for MVAS industry.

4G services will have negligible direct impact on MVAS services. Even if considerable number of mobile phones is released following 4Gs launch, number of consumers adopting the same is not very certain. But indirectly, it will surely help MVAS significantly," says Kalyan Banga, Manager, product development, Netscribes India.

It is expected that 4Gs introduction will eventually lead to lowering of 3G tariffs. "[In such a case] adoption of 3G services will increase across the country which will open a whole new dimension for MVAS services, which is not possible on 2G network," adds Banga.

However the future holds some hopes for the emergence of 4G based applications. The industry experts believe that with bandwidth going up considerably, more heavier applications will emerge centered around gaming and video services.

"The VAS industry is likely to reach Rs 490 billion mark by the year 2016 and will be dominated by 3G based services, while 4G would still contribute a small portion to this amount," says Katyayan Gupta, analyst at Forrester Research Inc.. The 4G MVAS market in India still appears to be a future talk with the industry incapable to cater to the high speed service.

- Rimit Singh, Correspondent, Light Reading India