The major challenge for VAS is:
1) Operator challenges: Operators focusing on subscriber acquisition with no incentives to push VAS in light of current spectrum allocation criteria. Spectrum constraints and delay in 3G roll-out has substantially limited high-end VAS take-off. Hopefully 3G roll-out will happen this time as annouced by April 2010.
2) Device challenges: To provide feature rich handsets even today is still expensive and a big challenge. Many handsets do not even have GPRS enabled and hence WAP portal as a delivery platform is a still a big challenge. Also, pre-loading the handset by the handset OEM is still not really taken off.
3) Content challenges: Localization of content today in India is also a hurdle in uptake of VAS services.
4) Revenue challenges: Ongoing tussle between operators and VAS companies still continues. (Still remember MyToday being blocked for 2 week more than once by some operator nor the other!)Operators still continue to reign as major chunk of VAS pie with them.
5) Awareness: Users are still not very familiar with medium of access such as GPRS, IVR, etc.
6) Because of operators, the other VAS players are forced to find a alternate revenue streams by providing advertising supported services but advertisers are still not convinced with the idea! Mobile advertising as a model is still in nascent stage.
7) Billing to the user from the VAS operator is still a big issue. When I was doing some comparitive study in the past, I was surprised to see small things like different rates for premium sms (of course based on the operator), post-paid and pre-paid for the same operator had different sms charges, Operators have recurring charges for CRBTs you never know when and how it happens and changes, etc. Even today for me GPRS connectivity is a problem. I have no clue what am I paying for the same. Not sure if I get a itemized bill for content download through GPRS at all.
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