Enterprise VAS : Fresh Turf

With plummeting revenues from voice services, mobile operators are now

looking at newer avenues for value added services (VAS). As of now, mainly

entertainment oriented services like ringtones, song and caller tune downloads

are being offered as VAS. However, to increase data consumption, VAS players are

now offering applications and services that meet basic utilities. In this

context, VAS has huge potential in the enterprise arena, and the operators are

fast realizing this.

The high ARPU segment is very small in the country, and operators will try to

get the maximum out of this segment. So coming out with applications which

appeal to this segment is on the priority list of all VAS players. The

enterprise market represents high value services for an operator, as many of

these customers will pay a premium for availability, reliability, and quality of

service.

There are two aspects to the enterprise VAS segment. The first is bulk

messaging kinds of services, which VAS players have been doing for quite some

time for the enterprises.

“The bulk messaging part of enterprise VAS was very happening until a few

months ago, and even SMEs had started using the service. However, for the past

few months, operators have started asking for a termination fee because of which

this is not a very popular medium now,” says Yogesh S Bijlani, vice president,

sales-APAC, Telenity.

The second segment is for the internal processes of the company. Enterprises

are looking at moving the processes to the mobile from personal computers. This

has special significance for BFSI, retail, logistics and media. “This will

dramatically cut down request processing time and the sales force to meet and

capture more customers. The financial institutions can directly reach more

consumers even in remote areas, and make interested consumers fill up loans,

credit card applications, etc,” says Vinish Kathuria, chief operating officer at

Spice Digital.

Spice Digital was earlier Cellebrum. The company has set up a new R&D

facility in Bengaluru to develop solutions targeted at the enterprise segment.

The facility will develop technology around Interactive Voice Response System (IVRS),

and towards integration of ERP systems on the mobile phone.

“It is a big growth driver for us. We have already deployed the system for

enterprises in BFSI, retail, pharma as well as for some SMEs. Enterprises wish

to adopt mobile solutions to reduce costs and increase productivity. Our

solutions mainly focus on both voice solutions as well as others centered around

tracking of inventory, finance and HR,” says Kathuria. The company grew by 100%

last year, and is looking at a similar growth rate in the current year.

Basically, VAS will help in uploading ERP on the handset of the executive.

This would then enable an employee to access various functions like HR, payroll

and finance while on the move.

The proportion of data will increase in the coming times, and the

applications which one was able to use on the personal computer will also move

to the mobile. It is here that enterprise VAS applications come in.

It is easy to understand the interest of the operators. With the revenue from

voice service coming down, mobile operators are looking at newer avenues from

mobile VAS to increase revenue from data services. Enterprise VAS is one way in

which the operators can target high ARPU generating individuals.

In India, ARPU is one of the lowest in the world. Globally, mobile VAS

accounts for 25-30% of the total value of what operators generate. However, in

India, according to COAI, it is about 10% currently and is expected to

contribute 20% of the mobile revenues over the coming three years. The VAS

industry in India is estimated to grow at 50% compounded annual growth rate (CAGR)

leading to a $348.8 mn market by the end of 2009.

According to Capgemini, the spending on mobile communication for enterprises

in the Indian market is expected to grow to $2.7 bn by 2010. A number of these

enterprises have requirements in the telecom space that are not core operator

skill sets, such as managed mobility, M2M services, and mobile enterprise

applications.

Enterprise VAS helps in better customer focus for the enterprises. If

customers get better services, they are likely to remain loyal and also bring in

more business. It gives employees flexibility in business execution and reduces

the turnaround time. Employees have everything on the mobile, and don't have to

rush to the office for data or consultation before closing deals. So it is a

win-win situation for both the enterprises as well as the operators.

BSA Citi Courier is one of the few enterprises currently using VAS

applications to get better control of the activities of its field employees.

“Earlier we had no link-up with people on the field, and we were not aware of

what they were doing. This has changed substantially. To begin with, all the

transactions are online, and we know where exactly the employee is and what he

is doing. It helped us in increasing the productivity as well as efficiency of

the field staff. Also, the employee doesn't have to come to office to file the

report. The data reaches us much faster,” says Devesh, director, BSA Citi

Courier. They have implemented MobiCollect, developed by Mobiquest, for their

field force.

BSA is not the only one. Enterprises across the country are lapping it up.

Taylormade Adidas is another company which has recently come out with mobile

cards for its customers. “It is basically a web-based program, which offers

privileges to my customer. Besides, the customers don't have to carry a plastic

card. They have a mobile card, which they would anyway be carrying all the time.

It is definitely better than sending an SMS to the customers, since it is cost

effective and it also offers ease-of-use,” says Ateet Gaur, head of Taylormade

in India.



Cellebrum is not the only one. Most VAS companies believe that the time for
enterprise application has finally arrived. Airtel is also planning to focus on

this segment. It has recently launched an application which will enable

enterprises to access their data and do business from anywhere in the world.

Besides, Mobiquest is another company which is focusing on this segment.

Early last year, New Delhi-based MobiQuest launched mobile enabled business

applications. The company rolled out Mobibank for banks and financial

institutions, and has around fifty such industry specific applications called

Mobis.

“The seamless architecture of our mobile enterprise platform is not helping

us create business process automation applications on the fly. We have mapped

more than 600 business processes covering business areas such as sales,

research, supply chain, data collection, media, HR, marketing/advertising,

training and industries such as banks, insurance, market research, education,

pharmaceutical, consumer durables and more,” says Vineet Narang, CEO of

Mobiquest.

The Challenges



One of the biggest challenges associated with enterprise VAS is of course,

security. If an employee loses his mobile, the company data can be intercepted.

In the business to enterprise segment, once data leaves the company server and

rides on public network, it is easy to intercept.

“There are many challenges associated with this segment. The biggest

challenge is security. If an employee loses his handset, it can compromise the

internal information of the company,” says Suresh T Kumar, GM-business

development and marketing at Netxcell.

The enterprises need to feel confident before using it and might have to use

a number of authentication and authorization mechanisms for data security

aspects.

Besides this, acceptability of the services is another issue which needs to

be addressed. “There are certainly some issues related to the acceptability of

the services by the users. As of now, it comes under the category,

'good-to-have' but it should move in the category of 'must-have',” says Kathuria

of Spice Digital.

There are many dissenting voices as well. Many believe that the time is not

right for such applications, and it is only after the advent of 3G that this

segment is likely to pick up. “We feel that this is not the right time for these

kind of applications. Currently, we lack the infrastructure to meet the demands

of this segment. Once 3G is launched, we would be in a better position to offer

various services to the enterprise segment,” says Bijlani of Telenity.

With private operators all set to launch 3G services and with the enterprise

segment showing interest, mobile VAS is all set to boom in the coming months.

Gagandeep Kaur



gagandeepk@cybermedia.co.in