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OnMobile bets on 3G boom for VAS push in India

Monday, 23 December 2013 - 7:22am IST | Place: Mumbai | Agency: dna

OnMobile Global, one of the world’s largest mobile value-added services (VAS) companies with operations across 55 countries, had taken a beating in India after its CEO Arvind Rao was expelled last year. However, under Mouli Ramanan, its co-founder and managing director, the company has been able to rise again. Ramanan tells Beryl Menezes about OnMobile’s journey ahead. Excerpts from the interview:

OnMobile has been aggressively targeting emerging markets, including India. What is happening on this front?
While caller tunes, which contribute about 70% to our overall revenues, are primary focus, we are now in the process of rolling out other services in the areas of music and sports as well. For example, we acquired Livewire, which offers high quality, personalised service at low cost, in the US in July. We also recently won a large deal with MTN, the largest operator in Middle East and Africa, with 200 million users, and we have a contract to roll out services in 22 countries where MTN is present. Latin America and Africa contributes 26% to revenues, and , in the last 1-1.5 years, besides emerging markets, we are also focusing on rolling out VAS services in Europe and North America.

How do you see growth in India in the coming years?
Out of 120 million users globally, we have 45 million in India. While in the last 1-1.5 years, OnMobile has witnessed a de-growth of 20-22% in India, due to regulatory intervention for promotional services and the downturn in the telecom and VAS industry, this does not reflect the opportunities that lie ahead. With 800 million mobile users in the country, a lot of them first time mobile internet users, we are seeing a lot of demand for VAS services on the mobile in local languages. There are also enough developers who want to provide services to these customers.

The ecosystem being developed for anybody who wants to provide these services. In the next 2-3 years, we will see a lot more services on mobile.

Revenue sharing has always been a matter of concern between VAS players and telcos in India...
Since the last one year, operators are beginning to realise the importance of getting more service providers and developers on board to provide services and so are open to giving more revenue share today. From 30-40% earlier, the revenue share is now moving up to 60-65% today. Service providers also have the freedom to provide and market the service themselves, while operators only provide the billing platform.

So are you planning to go beyond caller tunes and traditional VAS services?
While entertainment will continue to remain an important element, we have now expanded our offerings in the health space and citizen services. In the next 2-3 months, we will announce a deal with a large healthcare provider in India to provide access to quality health information in various local languages.

We have partnered with the Karnataka government to provide citizen services, and in the next one year we expect more traction from other state governments and parts of the central government as well. Caller tunes will also go beyond traditional musical tone sharing to automatic messaging like one is in meeting or driving, or it can be even used for brands and promotions, or for propaganda by political parties.

What will be the impact of technologies like 3G and 4G for VAS providers like you?
Ultimately consumer needs remain the same, but the way you deliver these services will improve, with improvement in technology – thus multimedia, audio-visual and video delivery will become richer and VAS services like m-commerce and m-payments will also go mainstream, and mobile will be a very important element of this. Being a company which has the infrastructure and ability to reach out to so many customers, OnMobile expects to have a good share of the pie.

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