JEDDAH, 21 September 2006 — Market experts predict an increase of $1.6 billion, or a 66 percent, in the sales volume from mobile phone based marketing over the next two years. The experts also view that the VAS will account for the 31 percent of the total market turnover in the Kingdom. Market analysts link their projections about the Middle East on the 88 percent growth registered in the direct marketing sector in the US and other Western countries. In the US 20 percent of the promotion budgets of companies are allocated for VAS promotions.
VAS is a telecommunications industry 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 service offering, spurring the subscriber to use their phone more.
The volume of marketing based on promotions employing melodies, logos and pictures on mobile phones in the Middle East is estimated at $360 million. The local experts emphasize that the local companies and distributors would struggle to get the greatest market share in the festival seasons of Ramadan and Eid on mobile phones.
As traditional promotion strategies are becoming disappointingly ineffective and against the sharply increasing popularity of mobile phones, businessmen believe that they can reach out to the maximum number of buyers with VAS. Mansour Al-Namis, an expert in the marketing field attributed the businessmen’s bias toward VAS to its interactive nature.
The system helps the customers to compare the prices offered by different companies and make the best choice. Several companies in the region have toll free numbers for customer inquiries. Large promotion companies are becoming increasingly aware of the need to turn to network convergence and offer innovative value-added services if they want to maintain their market share.
The development of value-added services, opens service creation to third parties. The Internet protocol is touted as the grand unifier of voice and data networks into the converged network. New applications are being designed for the creation of value-added services spanning multiple domains such as wireless, voice, data and enterprises.
Over the past decade, the intelligent network has played a significant role to support value-added services particularly in the West.
Value-added services are supplied either in-house by the mobile network operator themselves or by a third-party 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) or, increasingly, to a messaging gateway that allows the operator to control and charge the content better.
