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Chief Data Analyst at Mobilesquared Gavin Patterson shares findings from their latest report which suggests that mobile operators’ revenues will grow if they transfer from A2P SMS to A2P RCS, with every US$1 earned from SMS in 2022 equating to US$5.67 from RCS.

A2P SMS messaging has already proved its value to the mobile operator community with a simple business case based on transparent termination rates that has significantly swelled coffers in recent years. Investment in SMS firewalls has also produced a marked reduction in the volume of grey-route, unauthorised traffic, thereby ensuring that mobile operators are better able to monetize this significant revenue stream.

Nick Lane, Chief Insight Analyst – Mobilesquared at the Mobilesquared UK RCS Workshop

In 2018, the A2P SMS messaging market was worth US$17.01 billion according to Mobilesquared research (Global A2P SMS Messaging Forecasts by Country & Operator, 2017-2022) with official white-route traffic amounting to US$15.96 billion – equivalent to 93.8% of the total – and mobile operators pocketing a total of US$13.72 billion.

Over the next four years, to end-2022, A2P SMS messaging spend was forecast to reach US$26.61 billion, with white-route traffic accounting for 97.2% of the total – and operators banking a total of US$22.27 billion.

However, this does not account for either the traffic or revenue lost (or ‘transferred’ may be a better description) to A2P RCS messaging. The fact is that, according to more Mobilesquared research (Global RCS Business Messaging Forecasts by Operator, Country, Region & OS – 2018-2023), just US$1.07 billion of operator A2P SMS spend is likely to have moved to RCS by 2022.

However, the emergence of conversational marketing and conversational commerce on RCS means that every US$1 earned from A2P SMS in 2022 would equate to US$5.67 earned from A2P RCS – and that is completely ignoring the enormous potential from P2A RCS… which is likely to be even higher.

In effect, the emergence of RCS will grow the overall, operator driven A2P messaging business from a total of US$22.27 billion in 2022 (totally on SMS), to US$27.28 billion – and with A2P RCS still only contributing 22.3% of that total.

If operators haven’t already started planning for RCS, then now is the time to do so.

Gavin Patterson

Chief Data Analyst, Mobilesquared


Download Mobilesquared’s Global RCS Business Messaging Forecasts 2018 – 2023

The Global RCS Business Messaging Forecasts 2018-2023 Databook is the largest piece of research to date on the RCS business messaging market.

It includes five-year forecasts for up to 200 markets and 650 mobile operators, and is the only report currently available which delivers mobile operator national, as well as regional, forecasts. This Databook is essential reading for any company looking to invest in an RCS strategy.

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