In the dynamic world of technology, the upcoming year is poised for transformative shifts in communication and connectivity. Three compelling mobile technology advancements will shape the way we interact, communicate, and secure our digital transactions over the next twelve months. Rich Communication Services (RCS), the long-promised SMS replacement, is finally set to become mainstream, and disrupt traditional enterprise to consumer communication. Simultaneously, the integration of satellite technologies into mobile networks and devices promises to usher in a new era of seamless, global connectivity, and drive a new cycle of innovation in mobile services. Additionally, the realm of SMS based one-time password (OTP) authentication is on the brink of a major disruption, as newer FIDO (Fast Identify Online) based authentication methods take a more prominent role. Together, these predictions paint the usual picture of an ever-morphing tech landscape, one which will require agility, innovation, and reinvention to navigate.
#1: The RCS Revolution: Branded SMS in Enterprise Communication
After years of languishing as a promising technology in search of adoption, RCS has finally come of age. Googles efforts in promoting and deploying the technology have resulted in a global MAU community in excess of 1 billion. Recently Apple has announced that they too will support the technology in 2024, further enhancing RCS’s real potential. Together these developments have the potential to usher in the long-awaited replacement of SMS as the dominant messaging technology in the mobile network. As the mobile P2P ecosystem transitions, so, by necessity, will the A2P ecosystem. While we cannot expect enterprises to immediately adopt new technologies and fully replace their legacy infrastructure, transitional technologies such as basic RCS will be utilized to speed. Basic RCS uses traditional SMS ingress methods to facilitate RCS messaging. Essentially gaining the branding, authentication, and rich features offered by RCS, without the necessity and cost of a wholesale technology shift by the enterprise. Since in most cases this technology is being offered to the enterprise at similar price points to traditional SMS, the ensuing uptake of this technology in the mobile network will greatly speed adoption of RCS as the channel of choice for enterprise to consumer communication in many geographies.
#2: Elevating Connectivity: The Fusion of Satellite Technologies and Mobile Networks
The mobile landscape is on the cusp of a significant transformation as satellite technologies are seamlessly integrated into mobile networks. A series of groundbreaking partnerships and technology advancements announced in 2023 have laid the foundation for true, global ubiquitous connectivity. The viability of satellite direct-to-handset technologies has been proven in multiple proof of concept and trial environments and is now poised to become a staple of many operator’s service offerings. While this technology offers numerous consumer benefits by allowing connectivity in remote and underserved areas, it’s potential to disrupt domestic roaming relationships between operators cannot be discounted. The use of licensed operator owned frequencies will allow national operators to expand their home coverage areas into geographies that were previously economically difficult to serve and reduce their reliance on regional players to fill coverage holes. While the runway is still long for this outcome, as constellations grow and the service becomes more and more seamless the need for domestic roaming agreements will be impacted. While the technology is still nascent, it marks the first steps on a journey to disrupt the status quo of mobile roaming.
#3: Revolutionizing Authentication: The Decline of SMS OTPs and the Ascent of FIDO/Passkey Technologies
A seismic shift in the landscape of one-time password (OTP) authentication began in 2023 and is anticipated to accelerate greatly in 2024. The rapid rise in the costs associated with (particularly international) A2P SMS termination fees, as well as allegations of fraudulent AIT (Artificially Inflated Traffic) practices by industry participants have prompted major industry players to explore more cost-effective and secure alternatives. The emergence of FIDO/passkey technologies has gained widespread momentum, offering a robust and economically efficient solution for secure authentication. Major market participants, such as Microsoft, Google, Facebook, and others have already implemented this technology and are promulgating its use on a global basis. The impacts have already been dramatic. International A2P SMS traffic has already declined between 20 and 50% in in some geographies. We expect this trend to both continue, and accelerate, with major ramifications to both providers of wholesale A2P routing services globally, as well as operators who’s A2P revenue streams are at risk.
In Conclusion
As we embark on our journey through 2024, the landscape looking forward looks remarkably like that of years past. Technological advancements, and market forces continue to disrupt the status quo, and provide both enormous opportunities and risks. As an example, while we see serious risks in the traditional SMS OTP market, we see the widespread adoption of RCS technologies opening new horizons in the A2P world. While the advent of satellite technologies poses risks to traditional roaming revenues, it opens a new level of connectivity and potential service offerings to operators. The key in 2024, just as in years prior, is to understand the evolutions in both technology and markets, and to respond with agility, innovation and vision. Yesterday is past as are its strategies, tomorrow is almost here, the status quo is not an option.
