Are you ready for the future of messaging?

Pushpendra Mankad

BANGALORE, INDIA: The convergence of the Web and telecom worlds has resulted in profound changes in the way people communicate. One major area undergoing a radical transformation is messaging:

Market Changes: While the volume of messages continues to grow, commoditization and competition have resulted in price erosion and the search for new pricing models and revenue sources.

Challenging Alternatives: The availability of mobile Internet and the growth of social networks are beginning to create viable alternatives to traditional text messaging.

These key trends are leading operators to seek new business models that meet subscribers' changing needs while maintaining their profitability.

Market Changes: More Messages ≠ More ARPU

SMS, a traditional short message service on mobile, even today is pretty much the most frequently used feature after calling. The mobile subscriber base in India has crossed 440 million mark which increases by almost 10 million subscribers every month.

An average Indian sends 29 SMS per month and one can imagine the total number of SMS sent each day. SMS is the highest revenue earning Value Added Service (VAS) with almost 5 per cent revenue earned by service providers.

However, while traffic continues to grow, competitive factors are leading operators to change their pricing models and shift from "pay per message" to "buckets" and even "all you can eat" packages.

In these scenarios, text and multimedia messages are often priced the same and fall into the same bucket. Thus, from a business perspective, messaging is gradually morphing from a “portfolio” of independent services – each priced differently and running on a different platform – into a single “converged messaging” business whose costs and revenues operators need to monitor and optimize.

The growth in messages being sent also means that operators need to increase the capacity of their current systems. This growth underscores the fact that messaging is now, and will continue to be, in the foreseeable future a vital core service. As such, operators need to take measures to ensure telco-grade robustness and availability to meet user expectations of quick and guaranteed delivery every time — even during the most extreme peak demands, such as holidays and special events.

Challenging alternatives: Mobilization of the web

Another key trend, as noted, is the mobilization of the Web. With the huge popularity of social networks, mobile users increasingly want to use their mobile phone to perform activities such as updating their Facebook status, uploading pictures to a Web 2.0 site, etc.

Let’s say your teenage daughter is having a great day at the beach and wants to let her friends know, so that they can join her. Instead of texting (or calling) each of her friends separately, she can update her status or post a message on her preferred social network by sending a single text message from her handset.

How to stay relevant – and profitable

In light of these trends, the key challenge for operators is to find creative ways to stay relevant and profitable in today's changing environment. These are some of the “musts” which may help operators to remain at the top of messaging value chain:

Maintain a central position in the evolving communications ecosystem:  By securing traditional messaging business through smart pricing models, personalization of services and providing an enhanced user experience.

Assert relevance in the new market: By embracing social networking and user-generated content, offering smarter handsets, and upgrading their networks to support next generation IP-based messaging and richer communication services (RCS and Converged Messaging).

Tap into alternative revenue sources: Since revenues per message are flattening out, operators must tap into new sources of messaging income, such as mobile advertising and sponsored services.

Provide next-gen messaging experience: New messaging services allow users to send and receive any type of message (text, picture, video) from a single interface, simplifying the messaging user experience while enhancing the user’s address book with social presence and status information.

Reduce operational costs: Operators can boost profitability by focusing on reducing operating expenses. In order to reduce infrastructure costs, mobile operators are upgrading their legacy and expensive-to-maintain messaging systems to more cost-efficient, robust and flexible messaging solutions that will streamline operations and reduce the costs of managing and maintaining their messaging business.

Keeping it simple: From stovepipe to consolidated solutions

As their portfolio of messaging services and technologies expanded, operators found themselves having to integrate and maintain a growing number of systems which often perform similar tasks over different, uncoordinated platforms. In order to simplify this growing complexity while maintaining the services users demand, consolidation becomes paramount – both in terms of the user experience and the network systems used to run these services.

Users want simpler solutions that will allow them to manage all messaging needs in one place with an intuitive and holistic messaging experience. Operators, as well, suffer from the complexity and expense of maintaining and managing standalone stovepipe systems for each type of messaging service. A common messaging infrastructure could enable them to eliminate unnecessary duplication of databases, management systems and hardware, while enabling easy and synergistic integration of new services with fast time to market.

In such a scenario, the mobile operator could deploy multiple messaging services (e.g., SMS, MMS, etc.) that share a common set of infrastructure components (e.g., data layer, access, monitoring and management). A consolidated solution based on standardized servers significantly reduces complexity and enhances manageability, while liberating operators from lengthy deployment and integration efforts each time they want to introduce a new messaging service.

In today's dynamic environment, the pace of change and the multitude of new services are so great that "silo" solutions may no longer be feasible or efficient. Not only do services need to be up and running quickly, they often need to be able to "talk" to one another.

From content delivery to advertising, services may require the speedy and efficient use of SMS for short text notifications, while leveraging the rich media capabilities of MMS to send more engaging messages. A consolidated messaging solution can drastically simplify the process of integration to 3rd parties like content providers, ad servers, monitoring and billing, which are integrated once and become available for all messaging services.

Advantages of a modular approach

A modular solution, based on standard and reusable building blocks common to all types of messaging services, can streamline the deployment of new messaging services and help to reduce operating costs. Thus, a common user profile can be accessed by all messaging services, while a common OSS/BSS can be used by all services for monitoring and management.

A modular approach enables operators to reduce the time and effort required to extend their single-service messaging solution to support additional capabilities such as converged messaging or RCS. In addition, new network enablers, such as a network address book or a presence server, can be deployed and integrated once and then used by all messaging services.

From the user perspective, a consolidated solution enables a truly enhanced and converged messaging experience, regardless of the underlying technology. Users can send any type of message to any device without having to specify in advance whether it is a text, voice, multimedia, IM or video message. Such a solution allows all types of messages to be gathered in one converged inbox, and to be displayed on one screen in an intuitive and “conversational” format.

Future-proofing your messaging business

The speed at which the mobile messaging market is evolving compels operators to look at their business and the systems that support their messaging services in new ways. Messaging will continue to change. This reality dictates that operators take a more future-oriented, long-term view in order to maximize their technology investments.

Regardless of the messaging service they need today, operators should consider modular solutions that offer a flexible, cost-effective evolution path to next-generation messaging services. The adoption of progressive strategies, such as a consolidated messaging platform with a well-defined service roadmap, can allow operators to address their current needs for a cost-efficient and robust messaging platform while ensuring the readiness for tomorrow's services and standards. (The writer is senior vice president, Comverse Asia)

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