Announcements of VoLTE launches have made quite some headlines this year. So did announcements of Advanced LTE network rollouts, and the debut of Mobile Network Operators (MNOs)’ own content services, including Mobile TV and Mobile Music services. At the same time, the market was abuzz with trials and testing of various new technologies, including LTE Multicast and Wi-Fi Calling.
Rethinking voice and messaging
Amid all the excitement of new technologies and the revenue potential they promise, MNOs have also been rethinking their strategies around existing services, namely voice and messaging. Everyone in the industry knows that these two staples of the mobile business have been going through some challenging times, with increased adoption of OTT applications as well as stiff competition between MNOs that saw commoditization eroding the fat margins they used to enjoy on these services.
The reassessment of these traditional MNO services has led to renewed approaches in both segments, and this is giving rise to a few interesting developments in both markets. Voice business for example, is seeing a comeback with the launch of VoLTE and Wi-Fi Calling services. MNOs are looking to these services to complement their existing 3G and 2G voice, and traction is increasing in the voice space across the globe with a rising number of successful trials for such integration.
The MNO Messaging Market
But what is more interesting within the voice and messaging space are the developments in the messaging market. Messaging of course has been the segment to bear most of the brunt of OTT’s rise in the communications space, and while mobile penetration increased and people spent much more on their mobile services, messaging saw a major decline in revenues as chat applications such as WhatsApp, WeChat and Facebook Messenger started to record phenomenal adoption rates and began eating into MNOs’ messaging business.
Against this increasing threat from OTTs, can messaging continue to be a viable business for MNOs? This has been one of the biggest questions in the industry. What will happen when everyone migrates to using data for messaging, and come to rely 100% on using third party chat applications to send and receive messages?
Excerpt from the "Integrated Messaging Platforms: Evolving Networks and Business Models to Meet New Challenges" white paper:
... For example, in countries such as Spain and the Netherlands in Europe, and in South Korea in Asia, mobile operators typically charged high per-message prices for SMS and were slow to offer affordably priced bundles of unlimited SMS. Subsequently, P2P SMS traffic declined considerably in these countries as large numbers of mobile users adopted WhatsApp and Kakao Talk, respectively.
Mahindra Comviva, the global leader in providing mobility solutions, in its latest whitepaper “Integrated Messaging Platforms: Evolving Networks and Business Models to Meet New Challenges” which was produced in collaboration with the leading research house, Ovum, provides answers to this questions while discussing in depth the factors influencing MNOs’ messaging business which comprises a number of key services such as SMS, MMS, USSD, voicemail, and IP communications. The paper looks at the evolution of these services in both developed and emerging markets, and how MNOs can leverage newer use-cases and technologies to position their messaging business as a highly profitable growth segment.
Other Insights from the whitepaper
The paper presents detailed discussion about the growth trends for messaging services.
Excerpt from the "Integrated Messaging Platforms: Evolving Networks and Business Models to Meet New Challenges" white paper:
Global Monthly Active Users, Selected OTTs, 2011-2017
P2P and A2P
It also covers P2P and A2P services in great detail and highlights how the increasing demand for messaging-based Value Added Services is driving the former and how enterprise demand will be pushing the latter.
Excerpt from the "Integrated Messaging Platforms: Evolving Networks and Business Models to Meet New Challenges" white paper:
Global A2P SMS Traffic, 2014-2020
The whitepaper also highlights the ‘floating license’ model, currently provided by Mahindra Comviva, that offers significant advantages for MNOs looking to accelerate time to market, introduce more innovative services and reduce deployment costs across their entire suite of messaging services, and explains the benefit of cloud-based, integrated platforms in a fully virtualized environment in reducing total cost of ownership.
Available for free download now, the whitepaper makes a great reference for NFV enthusiasts and for MNOs revisiting their voice and messaging strategies with the aim of enhancing their existing messaging platforms while harnessing the benefits of virtualization and cloud technologies.
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5 December 2015 / Mahindra Comviva White Papers / By Tara Neal