Bharti Enterprises may sell off a majority of its stake in Comviva, a leading company specializing in providing value added services (VAS) for mobile handsets. Sources claim large IT companies such as TCS and HCL Technologies are competing to acquire the same and a deal might be in the pipeline. Reportedly, Bharti aims to receive between $300 and 350 million for sale of its non-core business.
The youth segment provides for a large consumer base demanding quick downloads for music, video clips and sports updates among others, enabling VAS to become a good revenue stream for mobile service providers. With competition causing voice tariffs to be priced at very low rates, mobile operators are increasingly turning to VAS for better revenue generation.
Services such as SMS account for half the VAS revenues, while caller tunes and mobile applications for radio, live score update and mobile gaming downloads are increasingly gaining popularity. For some mobile companies, VAS accounts for as much as 7-10 percent of their revenues.
With mobile players working to provide various new services on their 3G network and innovations like mobile banking on the rise, VAS revenues are expected to rise significantly.
