OTT business messaging involves enterprises using messaging applications to interact with customers.
The study showed that mobile operators will drop more revenues to these providers in the next 12 months, with the loss expected to be 20% higher over 2022. It further found that promotional messages will account for 30% of this revenue loss in 2023, with enterprises embracing up-selling and cross-selling capabilities through rich-media marketing campaigns.
Stable RCS pricing essential to keep competitiveness against OTT apps
Despite the popularity of third-party OTT applications, the report found that the total number of operator‑led RCS (Rich Communication Services) business messages sent will also increase, from 161 billion in 2022 to 219 billion in 2023.
The A2P Messaging market report urged network operators to move away from the turbulent monetisation models used for SMS, as fluctuations in RCS pricing will limit enterprise adoption of operator-led rich media messaging.
The study found that volatile RCS pricing will encourage the establishment of grey routes, with lucrative business messages concealed and transmitted within cheaper interpersonal channels.
“In order to support the growth of RCS business messaging, operators must ensure that pricing remains profitable without dramatic increases. Operators must absorb the initial cost of rich media messaging, using digital advertising and sponsorships to secure a return on investment,” said Scarlett Woodford, principal analyst, service providers and telecommunications at Juniper Research.
SMS maintains dominance
The A2P Messaging market report predicted the total number of SMS business messages sent will reach 1.7 trillion in 2023 – growing from 1.6 trillion in 2022 – as enterprises capitalise on the channel’s impressive open rates and unrivalled subscriber reach.
It identified that the use of SMS will remain particularly strong in the retail sector, with operator-led messaging channels in multi-factor authentication increasing in tandem with the growth of eCommerce.