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Submitted by Mike Grenville on Fri, 21 Nov 2008 14:48 |
The way that messages are handled between operators is changing and could pose a fundamental threat to the SMS services industry. To throw more light on the issue 160Characters hosted a lunch in London with a group of senior mobile messaging experts from across the industry.
With the discussion chaired by myself, attendees at the lunch, kindly sponsored by Tyntec, were (clockwise from the left in the picture):
- Aram Krol, Director of Product Marketing, Messaging - Acision;
- Ralph Kunz, Chairman - Tyntec;
- Saadi Hussain, Head of Commercial Propositions - BT;
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Johan Lindstrom, Director of EMEA Product Marketing - mBlox;
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Michael Kowalzik, CEO - Tyntec;
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Mike Short, O2 & MDA;
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Adam Bird, CEO - Esendex;
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Jeff Wilson, Chairman and Founder - Telsis;
Home Routing Background
Traditionally, an SMS travels directly from the SMS-C of the sending party’s operator through to the handset of the recipient. This means that the sending operator retains control and visibility of the message right up until the point of receipt. Under home routing this process is changed so that the message travels from the sending operator and is routed via the recipient’s own (home) network. Once received by the home network, the message is then forwarded onto the final recipient.
Transparency
This ‘home routing’ process allows the receiving operator to add value in the SMS reception process. For example, they can offer spam filtering, archiving of messages, re-direction to email or a host of other services that would have been impossible under the traditional messaging structure.
Depending on whether or not the sending operator is able to retain visibility of the message right through to the recipient, this challenges some of the assumptions that have underpinned the SMS industry. A lack of visibility removes some of the transparency that has traditionally made SMS such a clearly measurable communication mechanism.
The transparent implementation of home routing was for the most part agreed to be the preferred option overall since transparency removes most of the core objections to ‘home routing’ as a technology and retains the trust element of current arrangements.
Trust
Trust was a word that occurred repeatedly during the discussion. It was considered to be central because once trust between operators about the transparency of interconnects was lost then it would be impossible to regain, to the cost of the whole industry.
For example opaque implementations of Home Routing will cause a general undermining of trust within the mobile ecosystem as transparency on billing and delivery receipts is degraded. This trust could be corrosive on the efficiency of the system as a whole and could, eventually, lead to a weakening of the overall SMS marketplace. This weakening would be in terms of consumer service (as operators cut roaming agreements because of a breakdown of billing) and revenues (as corporates withdraw from enterprise SMS because of weak SLAs.
Filtering & Privacy
The main objection to transparent home routing was that the technology enables some key features that wouldn't necessarily be possible without an opaque system. Most notably, the privacy of subscribers and the security of devices was brought up as a justification for opaqueness. The belief was that consumers should have the right to keep their receipt of messages private and that a home routing system can prevent a number of security issues around fraud, spam and viruses.
Enterprise Impact
However where the impact of home routing would be felt was an area of debate. There was some discussion of impact on consumers but it was generally felt that any impact would be minor and indirect, and so wouldn't be a major factor in the debate.
The most vulnerable to negative repercussions from implementation were felt to be third party messaging providers and this was primarily in the enterprise SMS arena.
Jeff Wilson suggested an alternative scenario whereby enterprise SMS could overcome the potential unreliability introduced by opaque home routing systems. If enterprise messages were somehow flagged as such they could be treated differently by home routing systems, thus overcoming the problems of opaqueness.
The issue of the importance of enterprise SMS in the overall marketplace was discussed at length. A lack of hard evidence was quoted as an issue in establishing the true impact of HR technologies – without firm numbers on Enterprise SMS volumes it is hard to put a figure on the potential negative impact of their decline. An estimate of 3-5% was generally agreed on, but it was also noted that enterprise SMS has an opportunity to grow much further, potentially even giving overall messaging numbers a second growth curve as consumer growth plateaus.
Market Potential
Opaque home routing could cause a real issue for some new mobile services that use messaging as part of their mechanic or transmission mechanism. The two examples that were mentioned in particular were location based services (certainly ones that use HLR lookups to identify location) and content services that use SMS as part of their make-up.
Another instance of significant enterprise market potential is the traffic to be gained from Internet players adding SMS functionality into their services, with Google Calendar being a prime example. However, these players require reliability as a key piece of their service offering and so any threat to this posed by opaque home routing technologies could significantly damage this growth opportunity.
Mobile operators were by no means thought to be immune from the impact of the way that 'home routing' is implemented in the longer term as the trust ecosystem became degraded.
However Mike Short felt that there would be a natural commercial impetus towards transparent home routing within operators. SMS teams are incentivised on messaging growth and roaming teams are incentivised on revenues and relationships. If messaging growth slows as a result of Home Routing technology, and roaming relationships are put in jeopardy through a growth of mistrust, then these individuals will be incentivised to change Home Routing implementations.
Education
One of the key challenges facing any attempt to make the transparent implementation of Home Routing the default is understanding amongst operators. There was an agreement that there has been a flight of talent from operators’ SMS departments as the best individuals move to more ‘cutting edge’ sectors and as operators remove cost from what is seen as a stable and relatively straightforward technology area. As a result, in-house SMS teams don't necessarily understand the issues caused by opaque HR implementations and educating these people is going to be the key success factor for this campaign.
The GSMA was identified as a key player in the process of bringing around change in this sphere. The new AA19 agreements already dictate that home routing should be transparent but the question raised was whether these were being enforced strongly enough to make a real difference. The fact that the GSMA has no real sanction for rule-breakers (other than a non-compliant label) means that there is no real disincentive for operators to not implement opaque systems.
In conclusion, everyone agreed that there was a need for more dialogue within the industry about Home Routing and the potential impacts of the way that it is implemented. As Mike Short said, everyone wants to support innovation, but not at any cost.
Related article:
Risks of Routing Messages Home
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