SMS: P2P to A2P to SMS to RCS
SMS marketing is taking off. Estimates that it will break $1 trillion as an industry by 2019-20 are pretty much everywhere.
A handful of years ago SMS was split between P2P (person-to-person) and A2P (application-to-person). Initially the definition was based on intent. Personal or commercial. Then it became defined as valid SIM and non-valid SIM data sent from the phone in the form of messages.
WhatsApp was the most famous A2P service to break on the scene West and East of China due to it’s widespread adoption and perceived security. Twilio, InfoBop and SAP were not household names. Yet they controlled the most important aspects of an emerging industry, but couldn’t consolidate their advantage.
Fast forward to 2018 and you have more robust methods to implementing machine learning, rapid deployment of cloud environments, the expansion of API’s, innovative methodologies to tracking user device specific behavior and an abundance of vision.
Applying these to the SMS industry we ended up with a true industry disruption battle.
MessageBird, Bandwidth, Plivo, Twilio, SAP, SendSonar, Pypestream, Nexmo, InfoBip, Trope, Dialogue, CLX, Clickatell and Google – Jibe. These by far are not all the companies out there in the space, but they bring some high brow financial power to the table that can scare even the likes of Amazon.
The industry however bleeds with fraud. Mainly due to the preexisting notions/stubbornness that data access is split into four sub-industries. (Read more on fraud)
Network
Market
Enterprise
Consumer
In the PDF (outdated by now); it outlines 2% of fraud occurs in a roughly $100bn industry. That’s easy math. When you add in the potential fluctuation of 2% to 10% - that means that the over all infrastructure is not optimal.
It also means there is room to re-organize and properly set yourself to gain a larger market share. Whoever can break down the most barriers in data access will win.
Although SAP and CLX are large companies, they don’t make the cut for the lead. SAP is focused on it’s cloud and AI offerings while CLX is just a Jibe bi-product.
It would be between InfoBip, Twilio, Jibe and the wild card, Bandwidth.
Bandwidth is an up and comer. Already fielding a loyal base of users in the States and carrying out familiar marketing approaches to it’s brand; reminiscent of MailChimp during it’s early days. Bright colors - throw back to an era past. They have no debt and posted positive growth - albeit not the most explosive.
Twilio is a venture capitalist backed project. I say this because they inhaled a lot of investment since 2009. Over $400m in donations will make anyone an industry player. What is working for them is their approach to restarting the image that SMS is confined to government and banking sectors. They’re paid advertisements are well managed and the presence is light, welcoming. Offering hands on - risk free platforms for users to test, Twilio does it’s most to create a sales funnel out of anyone who has interacted with them.
The major obstacle to their case is that they draw on State side support and are already facing European venture capitalist competition in the face of MessageBird. Twilio has also posted operating loses. Something that should be noted and aligned more with a reckless Bezos-Amazon approach of 2 birds in a tree is worth more than 1 in the bush.
InfoBip - a quiet presence in the United States but a dominant player everywhere else in the world. It has all the billings of an industry leader. No major capital donations, a robust workforce, existing enterprise level clients, $286m in revenue and a working platform.
It’s biggest Achilles heel however - seems to be adoption. Despite it’s partnership with WhatsApp for Business clients - it fails to deliver it’s message that this perfect blend of trust, development and data transfer can be used by everyone throughout their daily life as opposed to business specific.
Which brings us to Jibe. Who is in reality just.. Google.
Purchased in 2015 - Jibe set the road map for RCS adoption. Google’s new standard to help reign in a wild west of SMS. Because the whole industry is fragmented into four sectors that create a unique piece, the one who has free access to its entirety will be able to reduce the most amount of client “fear” factors which translate into brand loyalty and increased awareness while maintaining promotional expenses to a minimal.
This tactic has worked for Google for two decades. For a single product. It’s one of if not the only company to be able to provide it’s own solution to each segment.
Network - Signed an agreement with local, national and international mobile carriers to access 1.9 billion users. Not including it’s mobile hardware reach.
Market - The Google Play Store becomes the firewall and the aggregator.
Enterprise - Hundreds of apps catering to whatever a business or developer could want with support resources such as cloud infrastructure and an ever growing library of API calls.
Consumer - Android phones become the consumer.
The brilliance about Google’s methodology is that it is very open about it’s positions. Much of it’s technology is shared with regular individuals, helping them grow and converting them into loyal brand users. This allows them to approach non-competing industry players such as mobile carriers and create a transparent deal that benefits both parties for the sake of uniting under a single profitable banner.
The SMS industry is turning into the RCS industry. An industry where you make your phone a trusted extension of your daily decisions.