looking after mms

the key to a healthy mobile future

MULTIMEDIA MESSAGING SERVICES (MMS), the Technicolor replacement for today’s widely used short messaging services (SMS), will be key to realizing healthy growth in wireless data services. The addition of multimedia elements including photographs and video clips significantly enriches the user experience and creates a plethora of opportunities to increase customer loyalty, build average revenue per user, and attract valuable content partners.

Don’t be fooled by the relatively slow uptake of person-to-person (P2P) MMS. Major mobile carriers have targeted the youth and travel markets with a “wish you were here” marketing message reminding users that a picture is worth a thousand words. As such, P2P MMS is merely a novelty designed to complement personal one-to-one SMS messaging.

Typical of many new service launches, much of the initial P2P MMS traffic resulted from messages being sent during an introductory launch phase while the service was free to users. A fully commercialized service — and one that is profitable — will be driven by the ability of operators to adopt new charging strategies that are simple for customers to understand and match the value of the service delivered. This requires operators to have flexible, real-time billing systems in place to rate, charge and bill for these services in the manner the consumer demands. And as a technology, P2P MMS is still dependent on the availability of compatible devices, the savvy of early adopters, the limitations of cross-network compatibility, and the hindrance of outdated billing and settlement systems.

A2P (application-to-person) MMS, on the other hand, doesn’t face the same vulnerabilities of consumer uptake, device availability and price sensitivity. A2P has explosive growth potential, enabling a wide range of “push” services including entertainment, sports, breaking news, video clips, downloadable games, infotainment and mobile marketing, as well as becoming a personalized mass marketing tool in the hands of advertisers and merchants. A2P MMS creates a spiky network issue for providers as a single message is pushed out simultaneously to the masses. But A2P has significantly higher revenue potential — tapping into large corporate advertising budgets and personal entertainment spends rather than continuing to target the everdeclining consumer communications spend.

Proof of an impending (r)evolution may be in services like MMS voicemail. With traditional voicemail penetration rates nearing 100 percent in most areas, MMS voicemail should expect a rapid uptake among users as a familiar service is transformed into an exciting multimedia experience. Senders may choose to personalize services with photos and video clips, subscribers may receive coupon offers or see logos attached by corporate senders, or be the beneficiary of free infotainment.

Profitable MMS service delivery doesn’t require identifying one killer app. Given a selection of well-priced content and service choices, subscribers will self-segment into communities of interest. Smart service providers are seizing this opportunity to learn much about their customers and secure their position in the value chain. Unlike the voicecentric businesses of old systems — restricted to time, distance, quality of service and time-of-day pricing mechanisms to charge for their airtime, resulting in price-sensitive consumers — competitive advantage today will be given to the carriers that can deliver high-value differentiated services and can manage the complete service value chain from delivery to receipt of payment to settlement.

While the concept of convergent billing is not new, operators are pursuing it aggressively as they consolidate numerous legacy systems and invest in an OSS that will support a single view of the customer across their prepaid, post-paid and contract transactions.

Not only must this OSS bring the customer closer to the service provider by supporting the more complex charging and service delivery models required of MMS, the OSS also must provide for centralized management of multiparty relations. The revenue garnered from video, for example, will need to be shared with the content providers in the value chain in a transparent manner using facilities such as Web access, partner portals and partner self-care.

Billing for interconnection between carriers will become of greater significance. Historically rationalized that usage balanced out between interconnection partners, increasing pressure on margins has caused carriers to regard interconnect as a cost/revenue stream in its own right. Since linking directly to other operators is expensive and time-consuming for the operator — requiring the negotiation and maintenance of hundreds of interconnect agreements — GPRS Roaming Exchange (GRX), dedicated carrier networks that interconnect varied mobile networks to exchange data traffic, have sprung up to ease the burden of managing MMS interconnection agreements.

Regardless, carriers will need systems to manage the wholesale billing relationships that are flexible, technically robust, and future-proof to handle not only the current wholesale billing challenges but also the future complexity of more elaborate wholesale charging, discounting, volume commitments, and multiparty settlement models.

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