Vas:
* Value added services are a term that is used to refer to service options that are complimentary to but also supplementary to a core service offering. The term is utilized widely in a number of industries, most notably telecommunications.
* Value added services are often introduced to customers after the client has purchased the core service that these ancillary offerings center around.
V.A.S in Pakistan:
Value added services work closely with the core offerings of any company. Here we should know that vas is not confined to telecommunications it is used in very business according to the business needs providing value and ease to the customer and increasing the revenue of the business. But still the major portion of value added services comes from the telecommunication companies.
In Pakistan the value added services are playing a very important role in shaping the market share. Brand loyalty is a very rare thing these days. Any operator with better services and innovative offering will have the opportunity to capture a major chunk of the market. This is the time when V.A.S becomes a secret weapon of operators.
In Pakistan, V.A.S is very popular and revenue generating but still it is in growth/ premature stage. The main focus of all the operators is on infotainment category of V.A.S. Then comes the informational services and at the last are the premium services such as E-mail; Micro Finance & Mobile Payments Mobile Marketing & Mobile Advertising. These services are used among a specific segment the masses.
The scope of value added services is very vast. All over the world the mobile network operators are providing all kinds of financial, entertainment and services that benefit the customers in real monetary terms.
Here we will look at the current structure of Pakistan value added services market, its dynamics, consumer preferences and the emerging trends that will come up in 2010 and also the problems that are causing the delay in the emergence of these services.
VAS PROFILE:
The following table shows the profile if the Value Added Services. The table shows the category of the V.A.S the characteristics it possesses and one or two example service of the relevant category.
| Category | Characteristics | Example |
| Entertainment | Designed for mass appeal | RBT; Song Dedication; Jokes |
| Info | Extraction of useful information using mobile | Yellow pages; missed call alerts; stock reports; LBS |
| Social VAS | Networking | Facebook, twitter, voice sms, infotainment searches and emails. |
| Business Solutions | Monetary transaction using mobile phones as medium of exchange | Bill payment; Mobile banking; e- ticketing |
All the categories are simultaneously available via SMS, IVR portals and WAP. The most commonly are the services which are accessible through SMS and IVR. WAP and GPRS enabled services are only used by a specific class of the society.
Current Products:
The Pakistani cellular network is composed of five players Mobilink, UFONE, Telenor, Warid and Zong. Pakistan telecommunication authority is the governing body regulating the activities and keeping a check on the activities of these organizations.
Each organization has its well defined services according to different categories. The mobile network operators (MNO’s) are charging very low prices for their core services so for excess revenue generation they have their focus now on value added services.
The advertising campaigns of MNO’s these days are more focus on value added services rather than core services. The race for the best services with highest value giving value added services is on. Every MNO is providing value added services in all the four categories of the V.A.S profile but still some of the services are very basic and are not fully implemented.
The following tables show the complete list of value added services provided all by MNO’s.
| MOBILINK | |||
| Entertainment & Fun | Informational Services | Social Networking | Business Solutions/ Utilities |
| Comedy Box Fun Services Messaging Services Fun Downloads Power Tools Content Dedication Services IVR Ringtones/Logos WAP Portal Voice Ringtone Maker Snap & Compare Talking Books GPRS/EDGE Game On Car Crazy Love Calculator 555 sub batata hai Mobilink TV Mobilink Cricket Kids Corner Mobilink Sports Portal TCS Gift Service SMS Filter Regional Portal Jazz Karaoke Winter Fun Fun Factory Spring Gala Jazz Mail Jazz Talk Jazz Audio Cinema Horoscope SMS Alerts | Jazz TV Guide Jazz News Watch SMS Banking Info-Line Service Holy Sayings Kisan Service My PowerTools Block/Unblock Broadcast Job Alerts SIM & NIC Services Package Info Service Blocking/Un-blocking Email2SMS Jazz Karobar Insurance Service Pollen Service Mobile Money Order SMS Translator SMS Search Power Tools Info Services Mobilink Yellow Pages Islamic Portal Jazz Word Wizard Jazz SMS Scheduler | Facebook Chat On Chat Services clickNshare twitter MSN Gmail / Google Talk Flickr LinkedIn | Mobilink BlackBerry ™ Mobisafe SMS Advertiser Corporate SMS Fax Mail Stock Watch PIA Reservations PSO Cards Conference Bridge MOBI TRACK |
| ZONG | |||
| Entertainment & Fun | Informational Services | Social Networking | Business Solutions/ Utilities |
| Dail tune application ZONG music channel ZONG ringtones ZONG SMS songs search ZONG music application Zong Song dedication Zong Artist of the month ZONG games Group SMS Khe do SMS Fun Pursuit | Zong Cricket info Wicket alert IVR sports portal Cricket crazy Football KSE updates Islamic names Weather updates Born today Daily humor Entertainment news Horoscope Dailt hadith Daily Quranic Ayth SMS directory UK visa Information | Pring Web2SMS SMS to email -Email to SMS Facebook application SMS buddy chat ZONG take one | Blackberry Corporate SMS Corporate VPMN Zong internet USB card Forex rates Financial news |
| WARID | |||
| Entertainment & Fun | Informational Services | Social Networking | Business Solutions/ Utilities |
| Warid comedy corner 105 dial tunes Dua service Warid Music box Zem talky Find a friend Find a place Zem mobile games Fun store IM over SMS Warid sports station Love meter | Warid phone book Warid Alerts 786 Islamic service LBS Miss call Alerts | Youth blog zone ZEM- Ghup lagaow Facebook text Facebook uploads Jhat pat balance | Blackberry Pocket PCO My virtual office Close user group Warid access cared Warid mobile email |
Other than these services UFONE and Warid have their own application stores. UFONE has its application store for Blackberry and Warid has its application with the name GLOW and serves to almost all the mobile sets.
The different categories of UFONE Blackberry application stores are:
- Business and professional
- Dictionaries
- Entertainment
- Games
- Health
- Lifestyle
- Localization
- Synchronization
- Security
- Themes
- Travel
- Utilities
And the categories of GLOW application store are as follows:
- Music
- Movies
- Mobile fun
- Games
- Sports
The important thing to look in these tables is the difference in number of value added services in entertainment and informational categories and social networking and Business solution/ utilities activities.
This difference is due to low demand of Business solutions and social networking services. The Pakistani market is much more in demand. Social networking using mobile is relatively a new concept which is being introduced after the success of Facebook, Twitter, and Flickr etc.
Secondly we do not see any services which are related to banking or involve any other financial activity. This opens a big gap or a new opportunity for the value added service developers to come up with some innovative, simple and value providing services to the masses.
Potential services:
The gap identified by studying all the available services lays in the Mobile Commerce/Business solutions and Utilities categories of the value added services. Here it is important to know what we mean by when we say Mobile commerce.
Mobile Commerce/Banking:
"Mobile Commerce is any transaction, involving the transfer of ownership or rights to use goods and services, which is initiated or completed by using mobile access to computer-mediated networks with the help of an electronic device”
There are three types of basic M-commerce transactions:
The first is carrier-based; using a carrier's billing system to purchase something with a wireless device. This method lets the user bill their purchase to their monthly carrier bill (or deduct it from their pre-paid deposit)
The second type of mobile commerce transaction involves using a credit card over a wireless network connection. In this type of transaction, the user securely stores their credit card data on their mobile phone, using their cell phone as a surrogate credit card.
The third type of m-commerce transaction involves financial services. These transactions include activities such as transferring money between accounts or paying bills through a wireless transaction.
Mobile banking is also a very important and hot topic these days. MNO’s are trying to adopt that model which will serve all the bank customers irrespective of the bank and operator. In Pakistan Bank led Branchless banking models apply.
But in the Mobile Commerce Conference held in March last month, the Governor State Bank and Chairman Pakistan telecommunication gave the hint of Telco led Branchless Banking model.
The bank led models of Branchless banking are:
Ø One-to-one Model
§ This model implies that one telecom operator forms a partnership or joint venture with one bank. The customers of the both of partners can take part in the banking activities. Telenor’s Easy paisa falls under this model.
Ø One-to-Many Model
§ This model implies that customers of one bank who is providing that facility irrespective of the ever telecom operator they use can make use of the banking facilities. Muslim Commercial Bank; Standard Chartered Bank; UBL Omni fall under this model.
Ø Many-to Many Model
§ This model implies that many banks and many telecom operators join hands to offer services to virtually all bankable customers. This model offers the maximum connectivity and hence maximum outreach but requires a central transaction processing system (like 1-link) controlled by a group of financial institutes or one single data processing house. This model is so far not being implemented in Pakistan.
Ø Alternative Channel
§ Here any person authorized by the bank can act its agent and conduct banking activities. This model can also work without any telecom operator. This model is also not being implemented in Pakistan.
MNO’s have taken certain steps towards mobile commerce and banking. But still there is a lot of work to be done. Mobile banking may not see much innovations until the introduction of Telco led branchless banking models, but Mobile Commerce can introduce some very innovative and real time value adding services.
Some of the Mobile commerce services that were introduced by MNO’s are:
Mobilink Genie:
- For money transfer and mobile and utility bills payment.
UFONE BAZAAR:
- An innovative portal for selling/purchasing property, motor bikes/cars using SMS, Web or WAP.
Mobilink TCS Sentiment Express service: S
- Sending your loved one’s gifts for every occasion.
Mobilink Mobile Money Order:
- Instant money transfer via Mobile Money Order (MMO) service by Mobilink.
ZONG Pay it All:
- Payment of utility bills from ZONG CSC.
When we take a look at the mobile banking category of value added services, we only observe that Bank led Branchless banking models are applied. Although SBP has recently announced that it will soon start a Telco led Branchless banking model and that the things are being finalized with PTA.
Telco led branchless banking model will introduce new innovations in mobile banking. Banking would never be the same again. It will bring ease, simplicity and most important of all value to the customers.
Application Stores:
Application Store is an online service which allows users to download these mobile applications/ contents on their handsets, depending on the platform of the mobile phone (Operating system).
In Pakistan there are only two telecom operator managed application stores. One is UFONE’S Blackberry App World and other GLOW by Warid.
2010 can be the year of application stores in Pakistan. More and more people are using smart phones these days and this trend automatically creates a demand for application stores. An application store having the applications/ mobile contents for all the platforms can be a success and can serve as a competitive advantage in the current highly competitive environment of telecom operators.
Location Based Services (Security Bundle services):
Location based services were introduced by Warid. The usage or the format of the service made it to fall in the entertainment category. A new service customizable for family or organizational use using location based services can be offered. Some of the features can be: (family based)
· Family group” (members can be family parents/children/spouses)
· Head of the family .e.g. Father can query the location of other family members. (LBS functionality)
· Family prepaid account spending’s for all the family member can be controlled by HOF.
· Each family member must be able to send SOS calls and SMS to HOF.
· Each family member must be able to send SMS to all his family members using single short code.
This is one of many proposals that can be given for the Location based services. LBS can also help in developing some new services such as:
Weather monitoring:
Location based weather monitoring will allow the users to get the precise weather condition according to his own locality. This will be different from other weather updates as it is specific to locality of the user whereas the normal updates are general.
LBS marketing:
The subscriber of this service will receive advertisements and sales promotion material on their cell phones for the shop of the specific market in which the consumer is present. This will help the operator to earn profit two folds. One from customer who subscribe and second from the market clients whose advertisement is done.
Intelligent Transportation Systems:
Unlike the conventional Global positioning systems, this service will use the cellular network to direct its users to get to their desire destination.
Problems/ issues:
With all these new services and innovations lie some inherent issues/ problems that need to be addressed before they can be implemented.
Mobile banking issues
· Handset operability:
This problem arises because different people use different types of handsets and each hand set has its own operating system which may or may not support the banking application being provided. The simple solution to this problem can be localization of application software so that it can run on any platform.
· Security:
Security is the biggest concern for mobile banking. People are reluctant to share their personal financial position. A proper regulatory system should be introduced to address the problem of security. The problem of security must be addressed jointly by application developer, wireless operator and the bank.
· Application distribution:
Application once downloaded needs to be upgraded if more features are added into it. Over the Air solution in which application checks for the updates itself and then downloads them can be proposed but these still raises questions of security.
· Ease and simplicity of use:
The application developed must be simple to use. Complex applications will not attract much traffic to the operator.
Apart from these few issues the connectivity and reliability on the part of operator is very essential. Smooth flow of information between customer, bank and network is of upmost importance.
Mobile commerce issues:
M-commerce also a growing service has some issue related to it which need to be addressed so that this services can generate more and more traffic to the network and bring value to customer. Some of the issues are:
· Illiteracy
Illiteracy is one of the biggest hurdle in Pakistan which is hampering growth of mobile financial services. People have no idea how to use them and even don’t know that they exist. Simpler M-Commerce models if introduced along with some basic knowledge this service can be the next big thing.
· Reluctance to use technology
Those people who know about these services are reluctant to use them because of technology. They have no trust on the service providers and usually claim that its too much difficult to use.
· Small screens of cell phones to view product(s)
In Pakistan, the phrase “Seeing is Believing” applies during purchase of any product or service. People usually claim that most of the time products which are displayed are not the one which is actually delivered. Also small screens of cell phones also makes harder to see and identify products.
· Safety of information
Safety concerns also apply in M-commerce. Giving bank details or credit card number over mobile phones can raise eyebrows of customers.
· Business’ lack of interest to come forward for m-commerce
In last but not the least apart from distrust and lack of knowledge of customers, businesses also don’t too much interest in M-commerce. Only a few businesses take part. Big business should be encouraged to involve them in M-commerce which will also give confidence to the customers to use this service.
The youth of Pakistan is taking much more interest in M-commerce then business community and self-employed individuals. MNO’s should concentrate not only on business class for their commerce services but also involve youth as they are much more interested in these services and will be the next business community.
Application stores issues
· Small market:
Application store have a small but a very lucrative market as we see for now. But with the introduction of application stores things can go either ways. To overcome this fear of not succeeding in the market, the initiator who will launch the application store must go through a detailed market study as to know what kind of applications are desired.
· Cost and payment:
Cost and payment modes must also be addressed because if the costs are too high or the payment mode is not acceptable then it will also cause the application store to no succeed in the market.
Conclusion:
“The fruits of every Value added service are short lived as the whole process of value added services is subject to innovation. Innovative and customer driven services should be developed so that the customers don’t sway to other networks”
To succeed in this cut throat competition, Value added services should be utilized up to their maximum. Innovations in existing services should be brought and more ease and simplicity should be introduced to daily mobile phone activities.
Companies, by paying attention to these services and also addressing these issues can capture a big untapped market and can also win the trust of customers. Happy customer; Happy employee; Happy Employee; Happy Company.
