Service providers in the telecom industry have come to realize that oftentimes the ability to compete hinges on successfully deploying what are known as “value-added services.” The trick is to figure out what type of value can be added that will be truly useful and enticing to customers.
 The necessity of value-added services spills over into the newer realm of VoIP, where technology exists to offer more at a competitive price, but providers don’t always know just what to add or how.
There is more to telecommunication than voice service which has dominated the Nigeria’s telecom industry since the introduction of Global system for Mobile communication (GSM). The long years of suffering by Nigerians for basic communication has almost made it unnecessary for Nigerian subscribers to avail themselves of other value added services that telecom operators offer.
Investigations revealed that many Nigerian GSM and Code Division Multiple Access (CDMA) users feel their phones are only for voice call and nothing else. This partly accounts for network congestion being experienced on networks. It would be recalled that GSM operators have faced sanctions from Nigerian Communications Commission on poor service delivery, though there are issues of capacity on the networks, but if subscribers avail themselves of other means of communication on the technology the frequent hiccups on networks will be reduced.
A Value-Added Service (VAS) is a telecommunication term for non-core-services or, in short, all services beyond standard voice calls. On a conceptual level, value-added services add value to the standard services offering, spurring the subscribers to use their phones more and allowing the operators to drive up their Average Revenue Per User (ARPU).
For mobile phones, apart from short message service (SMS), there are also services such as multi-media service (MMS) that enables subscribers to send pictures via General Package Radio Service (GPRS) which gives them access to internet from their mobile phones among others.
Value-added services are supplied either in-house by the mobile network operators themselves or by a third party, known as value added service provider (VASP). VASPs typically connect to the operator using protocols like Short Message Peer-to-peer Protocol (SMPP), connecting either directly to the Short Message Service Centre (SMSC) otherwise known as ‘short code’ or, increasingly, to a messaging gate way that allows the operator to control and charge for the content better.
The aforementioned situation seem to be changing as virtually all the operators in the country’s telecom industry have come to market with one value-added service or the other, as well following it up with advertisement.
MTN is currently advertising most of its value added service as against mass market promos. Some of its VAS includes MTN Google SMS, a mini version of Google search via SMS, where no internet connectivity is required. In this case, the search is keyword-based. Google SMS can give definition of words, News headlines, Sports information; and so on via SMS. Google SMS is also available through MTN Sim Plus.
MTN 3.5G Video Calling is an exciting VAS service which gives subscribers clear visual communication on their 3G enabled handsets which are enablers for video telephony.
Video calling is as simple as voice calling. However, the only difference is that the user will have to press the video call button instead of the voice call button. Then, hold the phone in front of you to watch the screen. It is possible for you to turn off the camera if you prefer not to be seen.
C-Track: this is a unique vehicle tracking and stolen vehicle recovery service that allows subscribers keep track of the location of their vehicles from the comfort of their mobile phones. By simply sending a text message, subscribers can ensure they are immediately alerted if their vehicle is moved – regardless of whether the ignition is on or off.
MTN C-track uses proven GPS/GSM technology in conjunction with an on-board computerized system to easily locate vehicles, measure vehicle performance and driver productivity, thus providing effective operational control and peace of mind to vehicle owners. Other VAS from MTN are SaveMyContacts, MTN Flash, Callertunez which enables subscriber to choose any ringtone of choice and mobile television.
Globacom has as well rolled out several value added services to the delight of its subscribers among them is Magic Plus, an SMS based service that gives the subscriber access to a host of information, commerce and entertainment content (ICE) directly on his Glo Mobile handset at the touch of a button. It is simple, quick and easy to use.
There is also Glo m-banking which is available exclusively on the Glo magic plus menu. This unique service provides all Glo mobile customers swift and easy access to their bank accounts from their mobile phones anywhere within Glo coverage area.
For the first time in Nigeria, one single application provides one with a uniform interface to a multitude of Banks. This is the result of Globacom’s collaboration with Interswitch Limited and its member banks.
Zain has also introduced unique value added service for its subscribers; they include fax services, Zain mobile office, GPRS services, callertunez among others.
Interestingly, there has been an increased attention by operators to launch and marketing of VAS as against what use to be the case two years ago when such services are not considered for advertisement.
This change of focus from voice to VAS industry watchers said could be attributed to competition. They said, there are a lot of telecom operators delivering voice which makes it not attractive to a subscriber, but rather they need service that will enhance their work or living standard, which is what VAS seek to achieve.
PTOs are not left behind in the craze to launch value-added services. Many PTOs are reported to have launched internet service, made possible by there upgrade to EV-DO Rev A. This technology afford operators the opportunity of competing with operators using 3G in the GSM space in terms of value added services.
Unlike voice calls, network operators find it difficult to disclose the cost of most value added services such as GPRS. Fola Odufunwa, managing director, eShekels, said billing clarity is crucial for success of VAS adding that subscribers need to know precisely what the cost benefits are, otherwise, such situation will constitute a barrier to adoption of these services by many people.
Moreover, Nigeria CommunicationsWeek investigations revealed that Glo mobile charges 60 kobo per kilo byte while MTN chargesN75 per kilo byte download. Both networks charge 10k per second for accessing GPRS services.
Odufunwa said value added services is still very much sub-optimized in Nigeria, which means that subscribers are getting much less value than is potentially derivable. This, he blamed on Nigeria’s peculiar situation that emphasizes more on voice.
But according to him, most Nigeria telecom operators are short sighted as far as VAS is concerned. For instance, in the Philippines, VAS contributes as much as 40 percent to telecom operators’ revenue. Telecom operators in that country actually put deliberate measures in place to help popularize VAS and today, they are reaping the benefits.
Gbenga Adebayo, chief executive officer, CNSS, commended the new development which according to him is designed to grow the network as well as a sign that the market is beginning to mature.
He emphasized the need for operators to have the required technical support for such services while stressing that there is need for operators offering GPRS to advertise the tariff they charge for such services to encourage the subscribers.
Operators can also learn to be more tactical with their pricing. In the Philippines, for example, SMS was free for up to one year after telecos launched the service. This helped to make SMS in the Philippines popular, people send more SMS in that country than anywhere else in the world. Also, operators should not just launch a service for the ego benefits.
In Nigeria, it seems that operators are keener on launching VAS as prestige projects which are not necessarily followed through with the right level of customer education and marketing to make them outstanding successes in the market place.
Industry analysts while applauding the current shift to VAS, believed that operators could make far more revenues and profits from VAS than they are currently doing despite the dominance of voice, if only they would accord VAS the right level of attention and support.
Now that the major GSM and CDMA operators have upgraded their networks to 3G capability, it is the hope of subscribers that more VAS be launched by operators in the market.