What are value added services in telecommunication sector?

Value added services
  • What are value added services in the telecom industry
  • The major segments in value added services market
  • Terms of service VAS providers are to abide with

Telecommunications companies have progressed far beyond providing basic voice and data services. They now provide a wide range of value added services (VAS) that improve the customer experience and generate new revenue streams.

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Without wasting much of your time, let\’s swiftly take a look at the following…

What is VAS in the telecom industry

Value added services (VAS) in the telecom industry refer to additional services or features that are beyond the core telecommunications services like: Voice calls, text messaging, and data communication that are been rendered to customers by telecommunications operators already. These services enhance the user experience and often come at an additional cost or are bundled with existing telecom plans.

Additionally, they are exceptionally useful as it makes room for Entertainment, Marketing, Advertising, Commerce, and General Services to end users.

They encompass a range of offerings such as mobile banking (including payment service banks and traditional banking), multimedia messaging, access to social media, content-based added services like gaming, ringback tunes, brainstorming services, and more.

Mobile Network operators can either provide these services in-house or through a third party value-added service provider, also known as a content provider.

Examples of value added services

Mobile banking: Mobile banking has gained significant popularity in recent years as a value-added service. It enables customers to conveniently handle their bank accounts and conduct transactions using their mobile devices. Through the USSD code channel offered by telecom operators, users can effortlessly check account balances, transfer funds, and pay bills. This service is particularly advantageous for individuals with busy lifestyles, as it grants them the flexibility to manage their finances from any location.

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Content-based added Services: These value added services present a wide array of entertainment options to customers, enhancing their mobile device experience. While these services typically come with individual charges, they can also be conveniently incorporated into bundled packages. For instance, customers can personalize their phone experience with caller tunes, subscribing to their favorite tunes or messages to entertain callers. Additionally, mobile game enthusiasts can opt for game subscriptions, gaining access to an extensive library of games for their enjoyment. These are just a few examples of the diverse entertainment possibilities that these services offer, contributing to the richness of the mobile user experience.

MMS messaging: Multimedia Messaging Service (MMS) messaging stands as one of the most widely embraced value-added services (VAS) within the telecommunications industry. This versatile service empowers customers to effortlessly send and receive long-form text messages alongside multimedia content, enriching their mobile communication experience. With MMS, users can share not only text but also images, videos, audio clips, and even contact cards, making it an ideal choice for conveying thoughts, emotions, and information in a more comprehensive and engaging manner.

Furthermore, MMS messaging is often bundled into mobile plans at no additional cost. This inclusion ensures that customers can take full advantage of the service without worrying about incurring extra charges, making it even more accessible and popular among mobile users.

Call Waiting: Call waiting alerts customers of incoming calls even when they are already on the phone. These services are especially beneficial for people who receive a high volume of calls because they can assist them in better prioritizing and managing their calls.

Voicemail: Another VAS that is frequently included at no extra cost in mobile plans is voicemail. Customers can use this service to record and retrieve voicemail messages when they are unable to take a call. This is especially useful for people who frequently travel or work in places where they are unable to answer phone calls.

Web/Social Media access: This service provides customers with free access to selected social media platforms such as Facebook, Ayoba, and Operamini.

VAS Segments And Their Purpose

The VAS market consist of four major segments, and the relevant market participants are as follows:

  • Network Operators
  • Aggregators
  • content providers, and
  • Developers of content, applications, and platforms.

Network Operators

The successful delivery of Value-Added Services (VAS) to end-users necessitates a seamless process where network operators play a pivotal role. To provide these VAS, network operators act as the crucial intermediary, serving as the final link that connects subscribers to the wide array of services and features available in the telecom ecosystem.

Network operators, through their extensive infrastructure and technical capabilities, bridge the gap between VAS providers and the end users. They ensure that subscribers can access and enjoy these value-added services on their mobile devices or other communication platforms

Aggregators:

Aggregators must offer a concentration point to control the number of devices that can connect directly to the operators, removing the requirement for Content Service Providers to maintain several physical connections to each Network Operator. They act as a link between network operators and content providers.

Content Providers:

The only players who pool, host, and distribute content and applications using their own hardware and software platforms are content providers and applications. This category of providers includes both telecommunications companies and independent businesses.

Developers:

Developers are the creative and innovative minds behind a vast array of digital content and applications. They often function as non-licensed, independent individuals or entities who contribute significantly to the dynamic landscape of technology and digital services.

What VAS providers are bound to do!

While value-added services improve the client experience, VAS suppliers are required to be bound by the following terms and conditions:

  • Avoid sending or having others send unsolicited, random telecommunications messages on their behalf (SPAM).
  • The consumer must be able to ‘opt in’ or ‘opt out’ of any promotion service, whether subscription-based or not.
  • Text messages delivered to customers shall be stored by the service provider for six months or for any time assessed by the VAS provider to be acceptable.
  • Service providers must ensure that no VAS service is promoted as “free” if there is a charge. There should also be no hidden fees for services delivered.
  • The service providers must identify whether it is a subscription service, the program\’s terms and conditions must be clearly specified, and service price information must be provided.
  • Service providers must provide customer support for all services. Complaints must be addressed within a fair time limit. And finally
  • VAS providers must follow the Commission\’s Quality of Service Regulations and other rules.

Conclusion

Value added services, in their essence, create a win-win situation for both customers and the service providers within the telecommunications industry. For users, these services represent a bridge to more efficient and enjoyable communication. Features such as multimedia messaging, mobile banking, personalized caller tunes, and data bundles contribute to a richer and more engaging way of interacting through mobile devices.

On the other side, telecommunications service providers reap substantial benefits from offering value added services. These services represent not only a means of enhancing their service portfolios but also a substantial source of additional revenue. By introducing these services, telecom companies tap into new income streams, diversifying their sources of earnings. It allows them to better monetize their networks and infrastructure investments while simultaneously increasing customer loyalty. The appeal of bundled packages and premium VAS offerings can boost average revenue per user (ARPU), a key metric for telecom firms.

     

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