Indian Mobile Users Are Struggling To Protect Privacy From Unsolicited Commercial Communications By Illegal Mobile Marketing Companies

In recent years, Indian mobility subscribers are getting lots of support from regulators. Telecom Regulatory Authority of India (TRAI) came out with multiple regulatory guidelines such as Mobile Number Portability (MNP), Mobile Value Added Service (MVAS) amendments, National Consumer Preference Registry (NCPR), Unsolicited Commercial Communications (UCC), and Roaming to enhance mobile user Quality of Service experience.

Continuous attempt by TRAI met strong resistance from service providers’ community as said regulations were considered by them as direct interference into their strategic and tactical business directions. TRAI managed to enforce mobile user friendly regulation and in-turn service providers invested millions of Dollars in the form of Capex as well as Opex without any direct revenue generation opportunity.

The implemented regulations intentions were considered by many analysts as milestone step by regulators to protect mobility users. Post Unsolicitated commercial communication (UCC) regulation, mobile user can initiate complaint against Telemarketing violating mobile subscriber’s privacy. If mobile subscribers registered themselves with National Consumer Preference Register (NCPR) by calling or sending request to 1909, then mobile subscribers would be entitled to escalate to regulatory bodies in case of their privacy violations. Mobile subscribers must remember that complaint must be done within 3 days of privacy violations. Mobile subscribers must take service request ticket number in order to make sure that their complaint or NCPR registration request are captured with service provider system. For NCPR registration activation implementation timeline is 7 working days whereas complaint resolution against unwarranted SMS or calls takes 7 days. Service providers verify complaint against mobile subscriber choice of NCPR. In case of the violation illegal Telemarketers receive notice as well as revocation of their telemarketer license. In case of complaint against Telemarketer using 10 digit mobile number instead of number starting with 140, regulatory impose heavy penalty and the owner of mobile number won’t be able take new number for two years.

In reality the enforced regulation somehow failed to impact the illegal mechanism to obtain mobility user information and use that information for mobile marketing activities. Generally, illegal Telemarketers manages to receive mobile user database from many sources where mobile users visits and register as web user and start executing mobile marketing call without any fear of regulation. Recently, TRAI even sent stern warning to BFSI sector to use defined practices to reach out to mobility user by adhering regulatory framework.

In practice many Enterprise are using bulk SMS mechanism through outsourced model to Telemarketing companies to reach out to mobility user in order to increase awareness about their existing or new products. Many illegal entities started feeling the pain of enforced regulation and even their business model were threatened given the high cost of mobile marketing including higher termination charges imposed by mobile service provider. In order to maintain their flagging profitability, many mobile marketing companies started taking contract from different sectors and started making unsolicited commercial call or sending SMS using 10 digit mobile numbers. By using existing user database which was developed over a period of time, Mobile marketing companies started procuring bulk voice as well as SMS plan based SIM and subsequently reduced their cost model drastically.

In order to further enhance their business, many illegal mobile marketing companies skipped standard process set by TRAI and also flooded service providers’ network with low revenue generating traffic. The new process inflicted major revenue leakage at service provider level and government also losing billions of Dollars. In order to safeguard business interest, Indian mobility user’s privacy was compromised and it is continuing unabated. None of the warnings or print media highlights being ignored by regulation offenders. The current penalty system defined by TRAI is too lenient for such companies as they are only interested in user data. On being slapped penalties, such companies close their shutter and open new companies. The loosely coupled regulation misses’ mechanism inclusion where service providers must be accountable to create awareness among Indian mobility users to enable them escalate the violation of their privacy with concerned regulatory bodies.

Indian mobility users placed in such an environment where most of them are not even aware that what rights they carry to protect their privacy. One can only conclude that “When Indian Mobility Users will get their due respect of their privacy”. Mobile subscribers must initiate escalation process to send across strong signal to illegal telemarketers and help mobile service providers as well as government to offer privacy, security to broader mobile subscriber base.

New Wireless Service Providers License By Indian Government Triggered MVAS Downturn

Once the darling of Indian wireless segment, the MVAS service providers are now facing identity crisis. Late 90’s and early 2000’s, the immense underlined potential around Mobile Value Added Service (MVAS) caught many eyebrows and subsequently few innovative minds turned Entrepreneur dived into MVAS bandwagon to make the most of it. The unprecedented Operator driven and controlled mobile subscriber growth offered MVAS service providers to collaborate with Indian wireless service providers based on wireless service providers favored financial agreements.

The On Net deployment environment governed by wireless operator offer MVAS providers an opportunity to focus on product more than servicing. MVAS service providers such as Onmobile Global, Hungama, Comviva, Hungama and many more achieved impressive YoY growth. Observing quick success through bundled or replicated product line on basic SMS and IVR based mechanism attracted many small companies to try their luck in MVAS segment. The auto recurring revenue stream with double digit growth assured MVAS providers regarding Technology and Consumer trend but missed to read continuous indication of Indian government and regulators to cash on to growing wireless subscriber base.

MVAS ecosystem players as well as Industry analysts came out with very aggressive forecast and equity market that also rewarded listed MVAS service provider’s equity investors. The induction of new wireless service providers brought cheers within MVAS service providers but changed the ecosystem of MVAS segment the most. The tariff war initiated by Regional and Challengers with Incumbent Indian Wireless Service Providers impacted MVAS providers the most. The freebies such as free voice minutes, SMS, Music service offered by new entrant created buzz with Subscribers and Incumbent experienced more than 7-8% churn rate as both rural and urban subscribers opted for low tariff based services by regional and challengers.

The sudden tariff assault on Incumbent forced them to restructure their service assurance and delivery and thus pressurized MVAS service providers to surrender more revenue, resizing VAS service portfolio as well as servers, removal of VAS services with low user uptake. Incumbent changed their strategy and in order to keep the cost lower; initiated Off Net service ennoblement for their subscribers to counter regional and challenger service offerings.

The Off Net service ennoblement by Incumbent acted as “MVAS FDI for many innovative MVAS companies spread across different geographies to tap into vast Indian subscriber base”. The move also impacted dearly to Indian Wireless Subscriber Provider but that will be part of another article.

The above move quickly changed the MVAS dynamics with feature and technological superior unified messaging, unified communications, rich communications etc. The incumbent MVAS tried to match new entrant product line but met with another onslaught in the form of MVAS regulation. It is highlighted through many articles for the last many years that fall in MVAS revenue is primarily driven by MVAS regulation but the reality is mentioned above. The “government and regulators move to bring in additional wireless service providers without setting ecosystem centric guidelines”. The knockout punch came out on cancellation of 2G license by honorable Supreme Court of India. It sent the ripple factor on MVAS players with higher cost than revenue and in-turn initiated unprecedented recession in Telecom sector. The MVAS regulation and its amendment should not be blamed for the downfall of Indian MVAS ecosystems instead MVAS players must take the onus due to lack of strategic and tactical moves with dynamically changing industry dynamics.