Looking Back, Looking Forward
Jay Seaton, Chief Marketing Officer at Airwide Solutions, offers a retrospective on 2006, and forecasts the top mobile trends for 2007
For everyone involved in the mobile messaging industry, 2006 was a year dominated by discussions about new technologies and applications. As phones became more sophisticated, the mobile communications industry made a concerted push to deploy services and applications from which end-users could generate real value, providing greater revenue for the operator and helping to reduce customer churn.
2006 was the year the industry turned its attention to mobile search. The opening up of walled gardens made the search box of interest to everyone and for the first time, the industry introduced ad-funded mobile content.
2006 was the year in which the mobile handset chipped away at the dominance of the iPod, and more sophisticated handsets gobbled up low-end digital cameras and MP3 players. The companies that power mobile music continued their consolidation and, fuelled by the ease and immediacy of mobile messaging, 2006 was the year operators evolved their portfolios to include a host of new applications such as picture sharing, text voting and mobile marketing.
Despite the popularity of new applications and services, 2006 also saw a renewed dependence on the established earners such as SMS. In 2006, the majority (more than 80%) of operator's revenues continued to come from SMS, especially in countries with fast developing mobile networks such as the Philippines, where a typical day sees over 400 million test messages sent. The view that SMS was rapidly being replaced by other messaging technologies has been replaced by the recognition that revenue-generating services can be rapidly and reliably deployed on the SMS infrastructure, and the adoption of those services will be dramatically faster, due to the ubiquitous nature of SMS.
Another development in 2006 was the increase in mobile theft, fraud, viruses and spam resulting from mobile devices becoming increasingly sophisticated and expensive. Currently, some mobile operators voluntarily police potential fraudsters, but as messaging services continue to grow and become more complex, there will be a stronger need to implement a comprehensive range of features such as blacklisting, anti-spoofing and anti-flooding across the network to prevent revenue leakage, preserve customer satisfaction, reduce churn, and avoid identity theft. And in addition to security controls at the network level, 2006 saw the emergence of a wide range of personalised controls, including allowing subscribers to define their own mobile anti-spam filters.
So what is expected for 2007? Fuelled by rapid adoption in the US, and mature but expanding markets in Europe and Asia, Airwide envisages the next 12 months being a very positive year for the mobile messaging industry. As individuals and organisations demand more specific tailored solutions and services to meet their growing mobility needs, we predict that the market for mobile applications and services will swell.
While there has long been hype about other messaging technologies, 2007 will see messaging revenues evolve beyond simple text-based services. However, to boost revenues in the short term, we will see operators deploy a host of SMS-based applications such as email-style functionality for SMS auto-forwarding, out-of-office responses, message archival and group lists, as well as interactive applications such as SMS voting. These will provide a bridge to next generation platforms and enhanced services by enabling the organic growth of SMS.
In the longer term, 2007 will see next generation messaging applications and technologies such as mobile IM gain in popularity, but they are no longer viewed as growing at the expense of SMS. The recognition of IMS as an evolving reference architecture, not a panacea, will continue. Operators will continue to shift their focus to finding a practical pathway to gain the positive attributes of IMS, such as component-based scalability, open interfaces and multi-protocol support, without disrupting the infrastructure that has been invested in. To achieve maximum benefit, operators must be careful to preserve their existing investments by deploying tiered architectures that dramatically reduce operating expenses, while also protecting their brand from increasing mobile security threats. Done well, this will lead to a natural and well-timed rollout of next generation messaging services that will offer greater differentiation, helping to build brand loyalty and reduce subscriber churn, while at the same time offering additional revenue opportunities.