Published in Mobile World Congress Show Daily
February 2009

Profitably Managing the Messaging Explosion

By Tony Holcombe, President and CEO, Syniverse

Growth in mobile messaging is one of the hottest topics in the wireless industry today. In 2008 alone, nearly 2.5 trillion messages – primarily SMS and MMS – made their way around the world. And according to industry analysts, this number will likely increase 20 percent a year by 2012. This means that in just four short years the number of mobile messages moving across networks will effectively double to an astounding 4.8 trillion.

Contributing to these exploding numbers will be mobile IM (MIM). In fact, one research group recently reported that it expects global MIM users to grow from 111 million users last year to 867 million users by the end of 2013. This increase translates to a rise in global messaging revenues that could exceed €9 billion within this timeframe.

However, before operators are able to truly capitalize on MIM and what undoubtedly will become a key market, the industry needs to overcome a number of business and technological challenges. Only then will operators be able to develop a sustainable business model and reap the rewards of the high projections put forth by industry analysts who have been touting the increased role of MIM in the mobile messaging mix.

Evolving to the Hub
Moving to a hub environment – a way of doing business that simplifies both the business and technology complexities of MIM – can be a cost-effective means for operators to meet the challenges of setting up roaming agreements, managing data and financial clearing, and ensuring that messages can move freely among between networks, among a number of other benefits.

Operators who join a messaging hub with advanced capabilities will be provided a central point of connectivity and service interchange with other operators. This means that an operator needs only to establish a single agreement with a hub provider rather than hundreds of bilateral agreements, thus providing a means to quickly expand a global messaging footprint.

Just as importantly, the hub reduces operating costs for the operator. The price of establishing new agreements with other operators as well as managing existing ones is substantially less. This model also eliminates the need to dedicate extensive technical and commercial resources to hardware implementation and testing, and ultimately shortens the time required to launch a truly interconnected MIM service – all without major investments in hardware, software or personnel.

The Future is Now
It’s clearly time for a new mobile messaging framework. I would suggest that with so much complexity involved in profiting from the mobile messaging market, operators must consider placing the the technical and commercial burdens on a trusted third party hub provider.

At Syniverse, we have been working closely with industry associations and our operator customers to find a solution to the challenges of true MIM and messaging interconnectivity. Our conclusion? The way to success is via an advanced messaging hub – a go anywhere, do anything solution that will meet the operator’s challenges of deploying integrated messaging services quickly and cost effectively, all while providing interworking between messaging types and ensuring reliable message delivery.

This new framework has the potential to radically change how all messaging services are delivered in real-time between users and will no doubt impact content-rich applications, such as mobile banking and mobile commerce that need to be delivered in real time and with timestamps, audit trails and other crucial criteria.

Then, with the complexities of this new messaging landscape simplified by a trusted third party, operators can concentrate on profiting from this exciting new sector while meeting the personal messaging needs of their subscribers.