BANGALORE, India (AFP)
Gaming companies, Internet portals and content providers are rushing to cash in on the explosive growth of mobile phones in India, predicting that content rather than cost will be the new battle ground.
“The price war in the mobile industry is now all over and there is a new type of war they (operators) will fight now,” said Vishal Gondal, chief executive officer of Indiagames.
“That war is going to be on content over the mobile phones,” Gondal told AFP. “In the future the major revenue areas for mobile operators are ringtones, wallpapers, downloads, games and movies.”
Indiagames, a Bombay-based firm which employs 130 people to design games for cellphones, joins five similar companies which have emerged in India over the last couple of years.
Gondal said that in Bombay operators were charging 50 rupees (1.1 dollars) for each download of games and that customers downloaded about 400,000 games every month.
“That is about 20 million rupees every month for games alone in Bombay,” Gondal said. “The gaming industry will be worth one billion rupees next year.”
There are 36 million mobile subscribers in India but by 2005 the figure is expected to touch 100 million.
According to US-based investment bank Morgan Stanley, India’s mobile market is expected to grow at a compound average rate of 40 percent until 2007.
India has also emerged as the second-largest market after China for cellphone handsets. Mobile phonemakers such as Nokia (news – web sites), Siemens, Sony Ericsson (news – web sites), Korea’s LG and Philips have launched new models in the market to keep pace with the demand.
Gondal said mobile phone operators would soon offer clips of Bollywood or Hollywood movies over the phone to lure customers.
“These people (operators) eventually will fight over data. The cellphone will be capable of playing music, download data playing videos and games. They have to then start thinking of themselves as a television channel,” Gondal said.
Neville Taraporewalla, country head of Yahoo! India, said his Internet portal, which offers downloads and streams across its e-mail messages to mobile phones, said the Indian market was ripe with potential.
“Revenues from voice for mobile operators are stagnating,” Taraporewalla said. “Content providers are fragmented and there is no unique selling proposition among them.”
“Despite all this we are in a very dynamic market. The ultimate driver will have to be the mobile operator. But for them to make handsome profits from content there has to be at least 100 million handsets in the market,” he said.
According to Yahoo!, 75 percent of the data market is still “person to person” messages from mobile phones and only 15 percent of the Indian wireless data market, worth 256 million dollars, is taken by ringtones and games.
“For the wireless data market to boom the price of high-end handsets capable of playing movie clips and games will have to come down and cellphones will have to be compatible and inter-operable,” Taraporewalla said.
Others, such as Bangalore-based July Systems, which develops products and solutions for wireless data mobile operators, said the market for mobile content services worldwide was estimated to be 38 billion dollars next year.
“July’s solutions help to transform content into compelling services including contests, mobile games tournaments, mobile communities … that increase the consumer’s overall service experience,” said July chairman Ashok Narasimhan.
“This is the key to driving consumer adoption and usage, and accelerating revenues from mobile infotainment services,” he said.
Technology analysts said India was well placed to grab emerging opportunities in the global mobile data market.
“In India, domestic demand will spur activity in the domain and Indian entrepreneurs are in a good position to take advantage due to their talent and expertise,” said Sridhar Mitta, president of TiE, a non-profit global network of entrepreneurs.