3G launch to bolster VAS revenue: DoT official

The share of the high margin value- added services (VAS) for wireless operators will rise to 12-13 per cent of total revenues after the introduction of superior 3G networks, a Department of Telecommunications (DoT) officer said.

Currently, VAS services contribute only for Rs 11,000-12,000 crore or 10 per cent of revenues under the older 2/2.5G network technology, Member-Finance of DoT, Vijayalakhsmi Gupta, said here at a conference.

"3G Technology will drive the next round of sustainable growth for the Indian (telecom) market through convergence of entertainment, infotainment and voice communications into one single device," Gupta said, after inaugurating the '3G India 2010' summit here.

"After 3G rollout, while video-on-demand and other live streaming services may gain prominence amongst the high ARPU (average revenue per user) customers, enhanced bandwidth may also lead to increased usage of existing mobile VAS services," she said.

The government had auctioned spectrum for 3G networks earlier this year which was bid aggressively by companies, resulting in receipts of over Rs 65,000 crore. Successful bidders are currently setting up their networks and expect to launch services towards the end of this year.