Mission Possible

VoicenData Bureau
New Update

Ever thought of the real culprits who are behind your

increased spending on phones? Be it feature-rich smart phones or paying for a

high security e-commerce transaction. There is always an invisible force working

behind the scenes, actually responsible for the success of such applications,

making you a spendthrift. And the culprits are not your mobile operators or

phone vendors, but the software vendors who are always busy developing something

niche-of course, they are also eventually responsible for making our lives

easier and exciting! Hence, we'll talk about these behind the scenes

characters we all are so in love with.


Carriers have invested a lot of money in their networks.

And at this point it's a lot like throwing spaghetti on the wall to see which

applications will stick. But as India is on a transformation stage with new

technologies like 3G and WiMAX ready to be deployed, independent software

vendors or ISVs, have an important role to play.

An Optimist's Market

Asia is the hot-bed of ISVs and has consistently demonstrated leadership in

wireless application roll out. The Indian market is heavily influenced by the

Asian market dynamics with over 120 ISVs developing their products across

various categories. The Indian VAS market is slated to touch the Rs 4,000 crore

mark by the end of this fiscal, thereby providing enough impetus to all the

players in the Indian mobile market. The number of ISVs is swelling with each

passing day: the estimated size would be in the range of over $120-150 mn

annually in terms of software licenses. However, with transaction-based or

managed service business models being adopted, the top-line for ISVs is set to

grow into hundreds of millions of dollars in the short term.

The number of mobile subscribers in India is expected to

grow from just over 100 mn today to more than 350 mn by 2010-an addition of

250 mn subscribers in just four years. It is estimated that mobile content and

entertainment services could be generating 15% of mobile service revenues and

over 40% of non-voice revenues within five years. The technological advancements

are the market developments driving that growth, and mobile games, real time

information and personalization services are evolving at a rate never witnessed



“The sheer number and complexity that the Indian market

involves, holds out tremendous growth potential to ISVs,” said Nikhil Jain,

president and COO, Elitecore.

Fact File


ISV's in India

120 approx

Indian VAS


Rs 4,000 crore approx


size for ISVs

$150 mn per annum

The Killer-app Hunt

At present service providers are looking for products that can enable

convergence over multiple networks. Here, ISVs play a critical role in enabling

convergence above the divergent network layer. They are delivering common

platforms based on open standards. In the face of numerous technologies and

services, the flexibility that open standards impart is enabling providers to

move away from their legacy structures and deliver converged services, involving

segmentation, rapid service launch and high service levels. In fact, billing and

soft switch vendors are replacing the proprietary IN platforms to provide

uncomplicated migration of providers to NGN. They are successfully taking on the

challenge of doing this shift with minimal disruption to legacy systems,

enabling providers to derive maximum returns on existing legacy platforms.


n3G and WiMAX: Service providers are also looking at

ability to deliver VAS over high capability technologies like 3G and WiMAX. By

enabling this shift from legacy structures towards NGN, ISVs can offer service

providers the readiness to deliver VAS over high capability technologies. They

are delivering convergence at the control and transport layers that is critical

to building margins through VAS.

Revenue share

between ISVs, SPs and vendors

  • The franchisee

    model, which involves building applications and running the new

    services for the provider, is a method of revenue share between ISVs

    and service providers

  • Hosted applications

    like gaming services where the ISV gets a share of the revenue each

    time a customer uses the service from the provider

  • With vendors, there

    is a pre-agreed sharing arrangement, or sharing happens on a project


“WiMAX and 3G enable bandwidth intensive applications

such as VoIP, IPTV, video conferencing, content downloads, presence services,

location based services, gaming etc. These new applications need to be charged

in real-time using innovative charging paradigms and price packages,” said

Ankur Lal, CEO, Infozech Software.  ISVs

need to create solutions for real time charging, integrating with existing

solutions, seamlessly upgrading the service provider's network and flexibly

launching new services as per the dynamic environment needs.


“3G would make the user experience better and richer in

terms of the quality and availability. Considering this, we have set up a 3G

competency centre in Singapore so as to innovate, test and pilot the solutions

before launching them in India,” said Saket Agarwal, COO, Cellebrum.

3G has certain features unlike 2G such as high speed

networks, a variety of data intensive applications, greater capacity for voice

and data, enabling rich data applications, and faster and larger applications

download. ISVs play an important role in this as current 2G platforms are not

compatible for all software. ISVs can provide better and heavy IT products on 3G

networks for more response and interaction with users. The ISV's array of

products will give rise to more access to users and slash the difference between

PCs and mobiles to a large extent.

WiMAX is also taking place in the world of mobile and would

soon be deployed globally. It gives extensive bandwidth to the mobile user and

the ISVs so major software can be downloaded and utilized.


nBilling System: With the advent of new technologies,

service providers would need support to keep their systems running. Billing

systems have long been a black box due to security issues and their proprietary

nature. ISVs understand that any service has limited value without billing

capability. Given this criticality, most ISVs today build an integrated

application model that enables billing and provides easy integration with the

carriers billing system. On a broad level, services are charged based on volume,

duration or qualitative classification and ISVs today are ensuring that they are

able to provide billing support for service uptake.

ISVs of billing solutions are offering professional

services, which enable product installation, configuration and management right

from Greenfield operators to tier-1 service providers. As the requirements of

these two levels of providers differ, there are different segments of billing

providers that serve these segments, particularly in their capability to deliver

professional services.


transaction based or managed service business models being adopted, the

top line for ISV's is set to grow into hundreds of million of dollars in

the short term

Opportunities Galore

Undoubtedly, as the telecom industry is evolving with technology deployment

happening across domain, convergence, in a true sense, would be pursued by ISVs

making specialized software for the niche requirements of VAS users. This would

create such a backdrop that whenever a subscriber thinks of a product it will be

there at his disposal, even when he's on the move. Technologies such as 3G and

WiMAX would make the user experience better and richer in terms of quality and


ISVs will hold the key for operators to be successful in

realizing the revenues from deployment of new technologies. Common people will

use the new technology only if cost of service is low and if there is some

benefit in getting the service. While the former is totally in the hands of the

operators, the latter will depend on how aggressive ISVs are in implementing the


“ISVs will play a very vital role in maximizing the value

proposition of various underlying technologies. New technology adaptations by

the core network providers are primarily focused on voice, SMSs and data

services,” said Manoj Pant, MD, India, Roamware. ISVs provide the icing on the

cake by enabling a suite of technology compliant applications and services which

utilize the capability of the underlying technology and enable new services and

enhanced experience and efficacy for wireless customers. The strength of the ISV

community is its focus on consumer needs and service opportunities, which the

core network vendors are unable to focus on. For this reason they would continue

to be valuable to the wireless consumer value chain as technology keeps evolving

over time.


“India is not just a low-cost services center but we do

have many organizations coming up with advanced technology products in the

mobile space. Our organizations are more than capable of designing and

developing the kind of business applications required by the consumers

leveraging available local talent,” said Amit Okhandiar, CMD, mlogica.


and their Offerings



Focus Areas: Mobile Content Development and Global


Applications: Games, Spiritual & Devotional Applications,
Utility applications, Business & Financial, BSE Portfolio Tracker as

well as Wallpapers, Ringtones, Videos and Themes. Developing IT products,

games and applications for stock exchanges and for Corporates


Focus areas:
VAS solutions across platforms like SMS, IVRS,

ASR, TTS, WAP, GPRS, USSD. Expertise in the fields of roaming solutions,

call processing, protocols and specifications.

Applications: Developed and deployed product offerings on the IVRS
platform using DTMF/ASR/TTS technology. The bouquet of services spans

across the information, communication and entertainment domain and

includes music, gaming, downloads and utility services.Â

The product line includes background music, Pay-4-Me, select caller

list, missed call alert, international call back, voice mail system,

caller ring back tone. In addition to this SMS gateway, Web2Mobile SMS,

SMS 6300, global number solution, roaming solutions are also currently

being offered.


Focus areas:
Billing solutions that can deliver FMC and

data-voice convergence. Driving modularization of Crestel Convergent

Billing platform to ensure greater flexibility to providers in solution


Applications: 'Crestel', a convergent billing and customer care
solution for wireline and wireless service providers; and 'EliteRADIUS',

a real time authentication, authorization and accounting software.


Focus areas:
The company enables mass deployment of multi-mode

wireline and wireless devices by providing optimized RISC-based VoIP

products with voice quality, QoS, and call switching y designed for next

generation end-points.

Applications: Next
generation multi-mode mobile handsets, PDAs, IP phones, and ATAs.


Focus areas:
Focuses on real time transaction processing in

transaction critical applications.

Applications: Venturing into the personalized voice solutions
space, complementing mobile enabled applications. Providing specialized

Next Gen CRM, convergent billing solutions for broadband service providers

and customer care solutions for packet-based, converged network



Focus areas:
ERP/CRM space includes consulting on packaged

applications, development/support and infrastructure management services.

Applications: Voice and data networking (VoIP and unified
communications) and business productivity improvement solutions using ERP

and CRM packages.


Focus areas:
Mobile database applications, RFID, GPS, tracking

systems, order processing and home-land security.

Applications: Emergency information systems, tracking system for
hunting down terrorists and criminals using RFID and GPS, RFID and

biometric based intelligence management systems, PDA solutions for

healthcare organizations and security databases


Focus areas:
Terrestrial, satellite and hybrid technologies.

Applications: 'm1375 RF', optimal technology to develop
integrated solutions for industrial communications;; 'm100', next

generation satellite data communications transceiver designed for the OEM

customers; 'm-Trak', fleet management solutions based on GPS/GSM

technology, provides real time fleet information.


Focus Areas:
VAS, mobile content distribution, one to one

direct marketer on mobiles and m-commerce enabler.

Applications: The current suite of multimodal VAS offered include
ring back tones, voice portal & WAP, corporate value added services,

m-commerce services, media portals and interactive TV programming, in-call

network solutions, and customer care-using speech recognition to

automate routine call center interactions.


Focus areas:
Provides value-added voice and data roaming, and

voice and messaging solutions.

Applications: Proprietary platform 'Roamware Service Delivery
System', using open standards enables integration of multiple mobile

applications. Apart from this other products include traffic redirection,

signaling relay, optimizer product, virtual home environment, SMS VAS,

enhanced messaging products, roaming gateway and network monitoring



Focus areas:
Mobile device applications. Voice recorder that

can be used by anyone, anytime, anywhere; and mobile business applications

that help mobilize enterprise data.

Applications: PIM type applications for managing personal data,
device applications for audio, video, files and other content sharing.

Working on a complete suite of products for warehouse management, on

demand messaging using Bluetooth and PVR type applications that support

audio streaming.

Current teledensity in India is to the tune of 14% on a

national average, which is slated to touch 25% in the next two years. VAS,

currently, is presumed to contribute 7-8% of the ARPU. It will also rise

proportionally with its contribution touching 10% of ARPU in the next few years.

Applications would be developed on the basis of newer technologies such as 3G

and WiMAX, which would further boost the mobile market in India.

With the changing technology landscape, a whole new set of

solutions will be built by ISVs to provide rapid time-to-revenue, business model

flexibility, and real-time transactional processing. The ISVs would play a key

role in supporting real-time partner integrations and enabling complex

multi-partner revenue sharing and settlements. To capitalize on the opportunity

to generate profitable mobile content and entertainment, ISVs will need to

understand customer behavior and react to changes quickly enough to make them

pay off.

A Collaborative Model

The entire gamut of VAS is based on the innovation of basic ideas, which

then translate into services that engage the subscriber. The investment is on

human capital, hardware and software which can be better utilized by better

revenue returns in terms of better revenue shares from operators. Also, ISVs

look forward to support in terms of coming down with the walled garden approach

at the operator level so as to have better utilization of the existing


“We mostly require advance information from service

providers related to new products and service launches, and sometimes access to

prototypes,” said DP Samantarai, MD, Softtrends.

The strength of any ISV is customer focus and constant

innovation in enhancing customer experience, capability and improving efficacy.

Many of the existing services are new concepts like missed call alerts,

voice SMS, ring back tone etc and the key support that the ISV community needs

is for operators to commit sufficient marketing dollars and management time to

drive adoptions and mass consumer uptake.

It is repeatedly proven that the success of a service is a

function of consumer education and marketing.

With the emerging managed service model, the success is win-win for both

the wireless operator and the ISV resulting in improved service, customer

satisfaction and new revenue streams.


migrating shift from legacy structures towards NGN, ISVs can offer service

providers the readiness to deliver VAS over high capability technologies

ISVs are looking for opportunities to test new offerings

with the existing equipment of service providers, and in large network

deployments. Vendor support is required in providing open interfaces. For

instance, Infozech has already integrated its solution with Motorola's GAMA

service delivery platform (SDP).

From vendors, ISVs are looking for open standards that can

accelerate the deployment of next-generation network solutions. They want

interoperable, best-of-breed components with global support and service

infrastructure, enabling them to design and deploy carrier-class next-generation

services for providers. One example is of softswitches, which provide this

flexibility and form a great complementary solution to billing solutions,

replacing proprietary IN platforms in critical functionalities like rating and

charging that can deliver convergence via a common platform.

Therefore, the collaboration of ISVs, service providers and

vendors is imperative for a successful roll-out of killer applications.

Revenue Sharing

One of the emerging trends is that ISVs are offering to take up marketing

and promotional responsibilities on behalf of carriers in lieu of a larger

revenue share component, which demonstrates the commitment and confidence of the

ISV community.

In India, service providers keep 60-80% share of the

revenue, the rest of it getting shared between ISVs and content providers. This

is not a very conducive environment for either. The global average of revenue

sharing is 50:50, however there are regional variations which could be

dramatically different. In the Americas and Western Europe the revenue share is

usually 60:40 between ISV and carrier respectively. However, in the Middle East

and Asian markets the ISV share varies between 30-40%, considerably lower than

the European markets. One of the reasons for this is that the vast majority of

new ISV applications are being rolled in the Asian and Middle Eastern markets

and the supply and availability of ISV applications are far more than the actual


Mostly, the Capex and Opex related to hardware, software,

content, royalty and others are put in by the vendor. Then, as per the contract,

the revenue on the end user price is shared between the vendor and the operator,

with the major share going to the operator.

In the Indian market the margins are even more fragmented

with revenue share components varying from 15% to 35%. It is very difficult to

predict the final uptake and revenue streams for new services as it needs a

committed and consistent marketing spend and focus in ensuring success.

"We mostly require

advance information from service providers related to new products and

service launches, and sometimes access to prototypes"

DP Samantarai,

MD, Softtrends

"The sheer number and

complexity that the Indian market involves, holds out tremendous growth

potential to ISVs"

Nikhil Jain,

president and COO,


Going Global

There is huge potential for Indian VAS companies to exist abroad since the

services and content is very much in demand. For instance, if we were to take

the case of Bollywood content, that itself is creating more returns per content

piece in Europe, Gulf, America etc, than the content sold in India, due to the

huge network data and voice capacities.

India is serving as a ground for ISVs to prove their

expertise, serving the complex requirements of tier-1 service providers who are

racing to build scale with margins. At the same time, these ISVs compete against

international billing players who are functioning in the Indian market. So their

ability to offer strong, highly competitive, innovative products, their

cost-effectiveness, speed in product delivery as well as their proximity allows

them to establish their credentials as tier-1 players.

In the current global scenario, Asia, Africa, and Russia

are the markets experiencing rapid growth. Indian players are primarily tapping

the Asian and African markets. In fact, large global ISVs too are targeting

these rapid growth regions.

“We are currently working with almost all the major

service providers in India and with some big operators outside the country.

There is immense opportunity for ISVs across the globe,” said Arvind Rao, CEO,


The key to successful global penetration is to focus on the

rapid growth markets-since these carry similar challenges that the growing

Indian market offers, allowing ISVs to take advantage of their experience in

handling the complexities of these regions. In addition, it offers them a ready

platform for high growth.

The Indian market presents a significant opportunity for

ISVs and the high uptake of a host of services demonstrates the growing appetite

of the Indian mobile user and the carrier mindset. Indians have demonstrated

their ability in the wireless space globally, and today Indian ISVs are leading

the way in creating new solutions globally.

While India has a very rich pool of talent for this space,

with the increasing number of development centers being set up here there is a

growing shortage and a steep hike in cost. For India to maintain the preferred

development center advantage, it is critical that we take radical measures to

augment the supply to this resource pool via focused training and education for

this domain. Given the business and social advantages that this opportunity

presents, a pan-India collaborative and cohesive initiative among industries,

educational institutions and government would be the best methodology to create

a consistent supply of the required skill sets for this industry.

India provides the best opportunity for ISVs. As a matter

of fact, global ISVs are swarming in big numbers to India everyday. There is an

enormous need for applications, as mobility gets into the first phase of

penetration and people just beginning to move beyond voice. There is a huge

potential to build and deploy business applications.

Rahul Gupta