The document provides an overview of the mobile value added services (MVAS) market in Egypt. It describes the Egyptian ICT market and value chain, common MVAS business models and strategies for entry. It also analyzes customer value perceptions and the factors that influence adoption of MVAS.

1. Mobile Value Added Services
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2. Location: TBE Egypt for payment solutions HQ, Maadi-Cairo-Egypt
Experience: 18 years of experience managing business unit and
commercial divisions, supported with Solid academic foundation
(EMBA).
Educational background: B.SC degree in telecommunication coupled
with Executive MBA, major Marketing strategy’s formulation and
implementation
 Business Specialties: Sales, Marketing, Business Development,
Product /Brand Management, Customer service, and Operation.
Business industry: telecommunications, household appliances, and
FMCG business in the Egyptian market
Profile:
 Proven experience and knowledge of telecommunications, household appliances, and
FMCG business in the Egyptian market.
 18 years of experience as professional Management at multinational environment .
 Fully awareness and skilled with planning, organizing, controlling, and leading skills.
 Proven experience in building new business from scratch in the Egyptian market.
 Reliable awareness of the Gulf area market "customers culture and habits" acquired during
his 12 years living in Kuwait,
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3.  The Egyptian ICT Market
 The Egyptian ICT value chain and key players
 Users Pattern
 What is MVAS and It’s Role
 MVAS’s customer value
 Market survey on VAS users
 MVAS Business Models & Entry strategies
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4. 4

5.  Mobile penetration  Internet users
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6.  International Internet Bandwidth per
 Broadband Subscribers inhabitant
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7.  Mobile tariffs in $  Internet access tariffs in
$
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8.  ICT Revenues  ICT Companies
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9.  Portion of ICT spending by household
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10.  Percentage of pre/post-paid subscribers  Percentage of pre/post-paid subscribers
and expenditure per gender and expenditure per area
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11.  Egypt is going through a telecom revolution, especially in the mobile segment.
 The users base has been adding 1 million subscribers per month (on an average)
and recently the mobile subscribers base crossed the 60 million mark in June
2010.
 The growing intensity of competition has led to more services to end user at
lower prices.
 As more users have been added to the subscriber base, it has led to a future
downward pressure on operator costs.
 The success of the mobile market can be gauged from the fact that the average
monthly spending of householders is by fare more than any ICT services,
(internet, or fixed line)
 However the other side of this growth is that ARPU’s have been correspondingly
declining . This declining has been accelerated by the marketing interventions
like life-time free schemes, it is also a function of the structure of the Egyptian
mobility market. At 95%, the prepaid segment completely dominates the
market.
 The flip side is that, customer retention has become very difficult. Loyalties in
the pre-paid segments are low due to the low switching cost and its common
for user to routinely change their numbers and service providers.
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12. 12

13. Customers & End Users
• Business Market
• Consumer Market
Public Network Operators
• Fixed Network
• Mobile Network
Telecom VAS Providers
• Internet Access Providers (IP Addresses Internet)
• Telecom Access Providers (MVAS Aggregators) (Special Numbering Gateway)
Internet Telecom Service Providers (ITSPs) (Web/WAP applications)
Wireless application Service Providers (WASPs) (SMS/MMS/USSD
applications), (Voice/Video applications)
Content & VAS Providers
• Operators, Media, Web Service providers, Brands, Corporate, Administration
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14. All those who are equipped with a terminal (mobile
handset, fixed phone, PC desktop/laptop…) enabling
access to basic services offered by network providers or
value added services offered by VAS.
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15. Under the regime of public network license, to deploy
telecommunication network infrastructures with national
coverage for the provision of basic telephone services and
VASs to their subscribers as well as carrier services to
other operators and services providers.
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16. Licensed by the NTRA, there are two types of providers:
1. The Internet Access Providers: core business is to offer to the
general public, internet access services via connectivity to the
backbone infrastructures from national or international
operators. Using access technology such as (Dial -up, Fixed
wireless, ADSL, VSAT, WIFI, WiMax, GSM/GPRS/Edge and
UMTS.
2. The Telecom Access Providers (VAS Aggregators): core business is
provide and operate special numbers (Short-Codes or Long-
Codes) to third party service providers, enabling them to market
their on-line service across all mobile operators. (through set up of
interconnect and revenue sharing agreements between each mobile
operator and the VAS aggregator.
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17. Including Internet Services Providers (ISP) and Wireless Application
Services Providers (WASP) over web, Vocal/IVR, SMS, WAP, MMS,
Video under the regulation. They operate and manage the dedicated
middleware application platforms, for both operators and third
parties, on revenue share basis.
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18. Any body (Telco Operator or non Telco), wishing to use
ICT to offer to its client some VAS over Web, Voice, SMS,
WAP in complement to its basic services.
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19. Produce and source different types of contents native format or
mobile terminal format (text, audio, picture, video…)
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20.  Household pattern
 Mobile users pattern
 Internet users pattern
 Market survey on VAS users “Quantitative”
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21.  Proportion of household with ICT tool
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22.  Proportion of household using internet
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23.  Barriers to use Mobile  Proportion of mobile phones with
accessories
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24.  Proportion on spending on mobile  Activities undertaken via mobile phones
services
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25.  Frequency of users access to the internet  Frequency of users access to the
internet/gender
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26.  Main activities undertaken by users  Main activities undertaken by
users/gender
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27.  Main locations of users accessing the internet
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28.  Still TV screen occupies the highest penetration rate by 95%, comes in second
the mobile screen and then the PC.
 Till 2009 the slow rate of ADSL service penetration rate affect the increase of
internet users %. This rate is expected to dramatically increase as result of GSM
operators racing for bigger share of broadband services.
 The Egyptian mobile market still indicate less than 10% of users expenditure for
VAS while 70% of there expenditure are still for voice calls.
 calls still the key driver of mobile users activities while VAS contribute smaller
margins of activities, come in first SMS that contribute of 30 % of mobile
activities.
 activities like, communication, video games, songs & SW downloading,
educating and wireless learning contribute the highest margins of internet
users internet activities.
 Based on the age group the location of accessing the internet changes, but still
home is the first choice to all age groups to access the internet.
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29.  Respondents profile
1. Gender: M 62%, FM 38%
2. Age: 25-34 76.5% , 35-44 11.5% , 18-24 9%
3. Occupation: government employees (17.6 %), private companies
(41.2%), engineers (38.2%), and students (3%)
4. 3G mobile phone users (82.5%)
5. Use mobile for both personal/leisure and business purpose (75.6%)
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30. 1. 91.2 % are using M-VAS
2. Famous M_VAS; mobile chat (70.5%), internet
browsing (59%), CRBT (41.2%), LBS and m-banking
3. The most wanted or planed M-VAS to be purchased
are mobile TV and video steaming.
4. 94.5% join SN site (Facebook, Friendster, linkedIn,
etc)
5. 62.5% of them access SN via mobile phone
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31. 1. High usage of mobile chatting and mobile internet
reveals that mobile operators have to keep offering
their customers attractive price plans for mobile
internet access.
2. The customer high expectations on emerging
services, such as mobile TV and video streaming,
reveals that mobile operators still have to develop a
viable business model for these services.
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32. 1. Finding from this customer value measurements
reveal that:
• All of the customer value dimensions are important for customized
mobile users
• Customers can appreciate and are aware of the benefits and cost in using
a mobile service.
2. The mobile operators must realize that the services
that they create will only be accepted if they are
delivering enhanced customer value in exchange for
their perceived costs.
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33. In mobile telecommunication industry, VAS is defined as
services that are:
•Not part of the basic voice offer.
•Allow the mobile operators to develop another stream of
revenue

34. MVAS
Market Size New Innovative Applications & Future High End Applications &
Services Services
Basic Applications & Services players continue to offer more Mobile TV Social Net working
innovative services
Operators too Focus on MVAS Video Confer- Multi-player
to stem Falling ARPU M Commerce encing Gaming
Video TV
launch of 3G & LTE to drive high
the MVAS market takes off, CRBT end applications,
A large number of MVAS Contests/Ga Consolidation in the industry
players enter various mes
segments across the value Industry players explores
chain Ring Tones operations across the value chain
Wallpapers/
Graphics revenue from MVAS
Info contribute to a mere X% of Mobile VAS contribution to total
Services total mobile operator operator revenue expected to
increase to XX%
P2P SMS
Year
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the Mobile VAS industry has evolved over the years from basic P2P SMS to innovative CRBT. This trend is expected to continue in the
future, leveraging new technology such as 3G, LTE which could lead to significant market growth

35. GSM (2G) 9.8- GPRS (2.5G) EDGE (2.75G)
14.4 kbps 56-144 kbps Max 384kbps
WCDMA/UMTS HSDPA (3.5G)
(3G)284 kbps- Max 14.4 LTE (4G)
2Mbps Mbps
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36.  Booming Economy, Egypt maintain its stable and growing economy
that has created job opportunities and increased the spending power of
an average Egyptian, this has resulted in higher disposal incomes and
faster acceptance of new technologies with a willingness to spend for
them.
 Increasing comfort levels with basic mobility services, Now a
critical mass of users in Egypt who are experienced mobility users, they
are very comfortable in using their phones and want to exercise the
option of doing more on them beyond basic voice applications.
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37.  Personalization of the digital world and digital devices, With
increasing pressure and stress on individuality, mobile users also want
to carry forward their individuality to their mobile, the success of Caller
Ring Back Tone (CRBT) is excellent example which illustrates that user
are ready to adapt to any service which offer them the option of
personalization .
 Reduction in call rates, The gradual reduction in call rates has
ensured that the expenditure on voice for a typical user has gone down,
as a results more user have become comfortable in spending on MVAS
as it does not significantly impact their overall expenditure on mobility.
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38.  Market effort driving VAS, Success of VAS has become important for
the growth of operators, most of them are now trying to innovate in
their VAS offerings. This has led to a sharp focus on marketing and a
somewhat limited the development of content.
 Focus on entertainment & SMS, Youth account for a large segment of
users, also dominate the pre-paid category, this leads to that most of
the rich contents available to the end users revolves around music,
ringtones, wallpapers, the focus on entertainment has been a strong
hook to develop the VAS category and operators & content aggregators
have been sharply focused in their effort to pluck this low hanging
fruit. Following the global trend TV channels have been focused on
making interactive programs. Thus programs, especially sports, music,
and content shows have started giving the option to their viewers to
participate through SMS. This focus have been a key driver in
increasing the familiarity with basic VAS for traditional low user
segment like non-working women.
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39. Category Characteristics Example
Entertainment Designed for mass appeal Games, Caller Ring Back
Tone (CRBT), music
download.
Info Characterized by the useful SMS Missed Call Alert
information (MCA), Stock Update,
Location Based service
(LBS).
M-Commerce Services involving monetary M-Banking and m-
transaction using the mobile payment
phone
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40.  Person to Person SMS (P2P):, the most common form of mobile
communication apart from voice.
 Ringtones: this is inclusive of monotones, polytones, truetones, also
includes CRBT (caller ring back tones).
 Person to Application SMS (P2A): all range of messages sent by end
users for contents and for seeking other information like news &
updates.
 Application to Person SMS (A2P): wide range of service push by
enterprise service providers, this include calls on IVR for all other
services.
 Games & Data: include download of one play games and full play
gamed also download of logos & wallpapers.
 Others : include MMS (Multi Media Messages) & subscription charge
for WAP services.
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41. Software/
Network Technology Content Interface Customers
Enablers
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42. Customers
Software/technolo
Network gy Enablers
Content Interface
• Back-end
system • Software • Mobile
• Content
• WEB & WAP Development
Servers • Payment solutions
Provision Portals
• Internet • Security solutions • Content • Mobile
Aggregation
• Mobile • Software Platforms device
Network • Application
Development
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43. Third Parties Aggregator National mobile Mobile End-
(VASP) Operators Users
Brands & Media
Special Network Access
Numbers
Providers
Corporate
Contents Billing Systems
VAS platform
providers Providers
Other VAS
Platform
Providers
(WASPs)
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44.  Data/Text Platform
1. The end user send the service request in an SMS form.
2. The request goes to a server managed by the platform enabler on behalf of the operator.
3. The content is arranged by the operator from the content aggregator who buys it from
the content developer.
4. This content is forwarded to the platform enabler who stores it in the server.
5. The server automatically and instantaneously entertain the request from the customer
as all these VAS are preloaded into the server.
 Voice Platform
1. The end user calls up the service provider and avails of the service.
2. The service is routed to a server managed by platform enabler.
3. The server interact with callers using IVRS(Interactive Voice Recognition System),
gathers information and routes calls to the appropriate recipient.
4. The remaining chain is same as that of a text base platform.
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45. Value is described as a “trade-off ” between overall benefits
gained and sacrifices made by the customer
On M-VAS customer value significantly:
1. Impacts on consumers’ behavior and commitment
2. Inf luences on customer satisfaction, and then, on loyalty
intention.

46.  “Get” Value Dimensions (Benefits)
1. Functionality value
2. Social value
3. Emotional value
4. Freedom of choice value
5. Epistemic value (curiosity/novelty)
 “Give” Value Dimensions (Sacrifices/cost)
1. Monetary/Price
2. Technical difficulties
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47. 1. The most important benefit perceived by the
respondents is functionality value, followed by
freedom of choice, curiosity, emotional, and then
social value.
2. Respondents perceive that the M-VAS are technically
easy to use.
3. In terms of monetary cost, respondents perceive the
additional cost that they have to pay for using M-VAS
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48. 1. Technology (Place)
2. Service Targeting (Packaging & Promotions)
3. Consumer Targeting (People)
4. Network Operators (Price)
5. Network Externalities (Products)
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49. 1. Focus only on age segment and needs (youth).
2. Piracy of contents (barrier for investing in content
development).
3. Lack of infrastructure (absence of location based
VAS).
4. Preference for low feature handsets.
5. High cost of VAS to end user
6. Absence of utility services (m Commerce).
7. Transparency in revenue sharing.
8. Spam. (miss using)
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50. 1. Mobile operators will lose importance in the value
chain as the market for content aggregators will
consolidate and their better bargaining power, this
will ensure a revenue shift from operators to
aggregators in the value chain.
2. We will see revenue from entertainment VAS come
down. End users want control and interactivity,
therefore the applications to look out for in future
will be user generated contents and mCommerce.
However mobile gaming will continue to grow and
will contribute a higher share to VAS pie.
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51. 1. Regional content is giving a significant increase to the
content market especially in the entertainment
category. With increasing mobility penetration into
the heartland of Egypt, significant VAS revenues will
be driven by regional content from B & C class towns.
2. Internet on mobile will become a more feasible
option as leading players in the internet content
space especially configure their sites for access
through mobiles. Thus GPRS usage should pick up
significantly.
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52. Model Definition Revenue Drivers
Subscription Model Users are partially or wholly The key driver is to maximize
charged a specific fee (for the willingness to pay by
premium contents) irrespective creating high levels of unique
of actual usage. customer value.
Advertising Model Content and services are mixed The key driver is network
with advertizing material, often traffic that rely on the
in the form of banner ads. expansion of SN driven by
user recommendation.
Merchant Model This involves wholesalers and User mass is the key driver to
retailers who trade mobile this model in order to be
contents, goods, and services. rewarding or profitable.
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53. Strategy Purposes/Benefits
Strategic Partnership Filling the gaps in the core competence
among the players in value chain
Customer Value based mass •Differentiating services from
customization competitors
•Boosting customer loyalty
•Inhibiting customers move to
competitors
Mobile portals A single “Plate” for various “Dishes”
Improve customer loyalty
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54. M-VAS is changing the role of most players across the
telecom value chain, while also providing room for many
new entrants, and requiring reconsideration of business
model and partnership.
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56. •Choose from the Categories
• Mobile Charge Cards
• Online Games
•»DSL Cards
• Prepaid Phone Cards
• Internet Phone Cards
• Stocks and Currency
• Website Services
• Hosting Services
• Education and Books
• Marriage Sites Cards
• Download Sites And Movies
• SMS& Mobile Applications
Cards
• Speed and safe internet
• Chat Services
• OneCard Cards
• Online Shopping
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