The (r)evolution of the SMS

A2P, and 21st June in GCCM Berlin, we participated in an SMS panel session where we were discussing the evolution of the SMS and the future of the messaging state

15 years ago, Lleidanet sent its first SMS. At that time communications were far more different from now. Most people were showing off their Nokia 5110 considered as one of the best phones at that time! Those days, the only way to communicate by phone with your friends in writing was via SMS. Smartphones changed the way we communicate to each other, with app such us WhatsApp, Viber, WeChat, etc. SMS texting found its proper place as an enterprise-focused communication platform.

Nevertheless, technology runs faster than operators, regulators and the law. In fact, SMS network infrastructures have been operational for many years however  SMS players must struggle against different hurdles to provide a high-quality service.

One of the issues we are facing is portability. More and more, subscribers switch lines without losing numbers and the percentage of ported subscribers is increasingly higher than 20 years ago, except in some countries like Venezuela and Guatemala where portability has been recently approved. That means that since SMS or calls cannot be routed based on the range number, checking the portability database in each country before routing a call/SMS has become crucial.

But when it comes to look up the portability database, regulators do not allow to access to this database in some countries. Understandably they want to protect databases and information, but sometimes they are adding too many constraints to the carriers willing to send traffic properly. In the end, the result is that in some countries SMS ported numbers are not delivered. That’s why, with a solid and extended coverage, is now focusing on acquiring new portability databases. We face yet another problem when providing a high-quality service, namely operators not leveraging their SMS network infrastructure.

We have observed different behaviours in operators:

  •  Operators with a secured network not having an official A2P route. They still work with the old P2P routes, either blocking the alphanumeric sender IDs or not accepting Short Codes. Most of them are working on having the A2P route but the process is too slow for the customer. When any P2P route is at an affordable price, customers send messages with international sender as P2P messages via P2P providers. If it is an expensive P2P route, they opt to send messages via sim-farms.
  •   Operators not caring about their networks and SMS are going through SS7 for free but without ensuring all the desirable features. Those operators are not still compelling about the potential of A2P, and they are undermining their revenues.
  •  Operators implementing a firewall and exceedingly increasing their SMS rates, killing the SMS market since they are not encouraging enterprises to use SMS to communicate with customers. A marketing campaign should be  profitable, otherwise a different way for such communications would be chosen. Operators should find the balance between their SMS rates and the price that the customer is willing to pay, fostering then SMS communications.
  • Operators implementing a firewall but not maintaining it or probably outsourcing it to a third party. This, and not having any protection is basically the same.
  •  Operators with A2P agreements with many aggregators based on prices per volume scales. The more traffic sent the cheaper the rate is. The result is that traffic is coming from only one aggregator, the one who has more traffic and consequently at the cheapest price. Customers depend Most of the time on one route that is throughput limited, with no backup, etc.
  •   In countries where off-net is allowed, some operators are not controlling national connections and traffic is leaking from local operators or local partners at a cheaper rate, the one that the customer is willing to pay, but unfortunately route is not direct.
  • Operators with many departments selling the same product (SMS) and competing between themselves. Corporate departments, interconnection departments, wholesale departments… all of them offering different prices within the same company, triggering the cannibalization of their own sales. Or even when a department is selling sims to sim-farm providers thus becoming their allies. Most of the time, customer is affected by these situations.

We could go on talking about different bypass situations in SMS routes, but the idea is operators are not nimble enough to keep the pace of technology, and they are losing opportunities.

What are the customers’ reactions to these scenarios?

Customers are exploring other ways, they are coming to other platforms to find different channels to reach their customers. For example, Viber is opening their platform for commercial and marketing purposes. Other companies are implementing their own APIs to find the best channel for the client, even fax!

Market consolidation is also present, aggregators are acquiring other companies to become stronger by expanding their international presence.

How has tackled these SMS challenges? is changing its view on SMS, adding a different value on it and evolving to developed communications with registered electronic communications, helping enterprises with digital transformation.

Initially, we started with Registered SMS, issuing a documentary evidence, providing the content of the communication, the exact time the SMS is sent to the user’s handset, and the moment it is received. It is an efficient, economical and reliable communication channel used by companies to communicate with customers.

Sooner rather than later Registered SMS contract, Registered email, Registered email contract were developed based on our customer’s feedback.

Nowadays, Connectaclick and RIU are leading the registered electronic communications market.

Connectaclick, is a robust and reliable solution, highlighting the ease of use to the final user to sign online contracts. It is used by financial institutions, insurance and power companies as well as large companies.

RIU, Remote Identification Unit, is the definite platform for remote identification by videoconferencing for onboarding and KYC (Know Your Customer) processes. The user connects to RIU, records the process, takes a photo of the front and back of the ID and a selfie. RIU verifies and validates all of them.

But how Mobile Operators can take advantage of RIU?

A customer can buy a prepaid or post-paid sim-card from home, just validating his identity with RIU and signing an online contract with Connectaclick. It is not necessary for the customer to go to the store and to scan his ID, a simple digital process done within less than 10 minutes from home or from anywhere at your convenience.

It is worldwide known that SMS reaches every user with a phone providing very high conversion rates. However, enterprises are moving to new communication channels but always hand in hand with SMS texting. Summing up, innovation and sustainable business for all market players.

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