A New Future for SMS

February 9, 2015 Jeff Bak

Segment SpotlightTata CommunicationsTelecom Council Member Posts

Author: Jeff Bak, Vice President of Mobility Solutions at Tata Communications

SMS has existed for more than 20 years yet is still one of the most immediate and personal forms of communication. This versatile technology is finding a new role as a way for enterprises, application providers and OTT players to reach and instantly engage users. These players are integrating Application-to-Person (A2P) messaging into their mobile strategies and showing that there is a new future for SMS.

Organizations as diverse as eCommerce sites, financial institutions and social networks can send SMS to users as a secure, private and personal way to share information. Banks or social networks can send password resets or activations via SMS and give users quick and easy access while travel websites can confirm flight bookings with a single text. It is an instant and reliable means of communication that can reach mobile users beyond email or smartphone apps.

In 2013, just under 50% of mobile phones shipped were feature phones, according to IDC, and accounted for an estimated 80% of mobile phones being used in developing markets. This means SMS can offer reach where a mobile app or web service cannot. It doesn’t require new technologies or platforms and is equally accessible on both smart and feature phones.

The challenge for enterprises and application providers is that while mobile messaging technology is ubiquitous, creating and scaling relationships with mobile operators internationally is resource and time intensive. The utility of mobile messaging is obvious but how to get started in the space isn’t.

Enterprises and application providers (A2P originators) need a simple and efficient solution for integrating SMS into their organizations. For everyday Person-to-Person (P2P) messaging, mobile operators have long used global wholesale providers who have expertise in SMS interconnection as well as extensive relationships across the mobile ecosystem to reach more end users in more places. Both A2P originators and mobile operators can leverage these existing relationships and interconnections to create a new exchange model dedicated to simplifying A2P SMS delivery.

Messaging exchange providers, like Tata Communications, deliver a single, trusted source for global mobile messaging with guaranteed quality of service and one-stop billing and support. Unlike P2P, the exchange provider must also enable security and filtering to protect subscribers from unsolicited, unwanted messages. Global messaging exchange providers are making the integration of A2P messaging into an enterprise or application provider’s business seamless and capex-light.

On the mobile operator side, working with an exchange provider is a way to add value for the subscribers while monetizing the traffic on their network. Growth in A2P messaging has the ripple effect of increasing subscriber demand for data packages while the relevance and dependability of the messages received increases customer stickiness. A2P messaging is a force that operators cannot stop, because it is driven by end-user demand for a more immediate communication channel than email.

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