Tuesday, March 21, 2006

MMA releases new Best Practices Guidelines

Today, the Mobile Marketing Association (MMA), of which Quios is an active member, released Version 2.0 of their Best Practices Guidelines. They can be downloaded here.

The Best Practices Guidelines have been established to provide a better wireless consumer experience by giving the consumer control over the communication to his/her cell phone and by ensuring that the consumer has been properly informed of all premium charges.

The new guidelines now include specific recommendations re. chat programs, very similar to the T-Mobile playbook requirements. It is expected that these recommendations will be enforced by all carriers. Furthermore, we expect that Verizon will soon start accepting chat programs again, provided they conform with the new MMA guidelines.

Thursday, March 16, 2006

Success Billing Ratios (SBR)

Here's one of the industry's dirty little secrets. Not all Premium SMS transactions succeed. As a matter of fact, many will fail. Each failed message is lost revenue for the customer, and brings down significantly the average outpayment per message. The ability of a gateway provider to actively manage SBRs and minimize failure rates is therefore one of the most important criteria anyone should use in their selection of a gateway provider. It is significantly more important than the outpayment rates themselves.

The average SBRs we have seen for 2005 are as follows:

Verizon Wireless: 93.4% (i.e. 93.4% of PSMS transactions succeed)
Cingular Orange: 72.3%
Cingular Blue: 60.7%
Tmobile: 54.1%
Nextel/Boost: 54.4%
Sprint: 55%
Alltel: 52%
Dobson: 69.8%

What explains these failure rates ? The reasons tend to be carrier specific, such as:
Cingular/Tmobile: Prepaid phones are not supported (Tracfones, or other). Hence all PSMS messages sent to prepaid subscribers will fail.
Nextel/Boost: Subscribers need to set up an eWallet with the carrier before they are allowed to receive Premium billed messages. Many subscribers don't do that.
Sprint: Sprint's outpayment statement now have a 'pending validation' clause, meaning that the carrier reserves the right to retroactively correct any mistakes in their outpayment statements. This is due to the fact that Sprint used to accept and pay out on MSISDNs that did not belong to their network.
Alltel/Dobson: If a subscriber complains to Alltel or Dobson customer support, they will automatically be blocked from receiving ANY Premium SMS messages

The biggest reason why PSMS messages fail (can account for up to 20% difference between success and failed messages) is because customers submit the wrong carrier information along with the Premium SMS message. Quios has solved this problem for its customers by looking up the carrier in its LNP (Local Number Portability) databases, hence ensuring that the message always gets delivered to the right carrier. As a result, the Quios SBRs are one of the best in the industry.

Summarizing:
SBRs are the single most important determinant of success and profitability of any PSMS campaign. Select a gateway provider based on its ability to manage SBR ratios. Ask your provider about their average SBRs. If they don't know, they probably don't manage it very well....

Verizon and Chat

Verizon has put a hold on all new chat programs pending the finalization of their new chat policies and guidelines on or around December 23rd. They feel that the current programs represent a significant risk for VZW from both a content standards and Best Practices perspective.

Update: As of March 16, 2006, all new chat programs continue to be on hold. No new guidelines have been published yet.

Sunday, March 12, 2006

Cingular and Subscription billing

As mentioned before, Cingular is requiring all off-portal subscription programs to move to monthly billing, using Cingular's subscription program. Some aggregators appear to be reluctant to move to this new system, probably because of the significant technology changes required to be in compliance with Cingular's new infrastructure. However, as a Cingular representative recently pointed out: "We have 16 people that we pay $1,000,000 per year to monitor campaigns. Anyone not billing monthly for subscriptions will be caught and shut off". Better be safe than sorry !!

Verizon and binary content

Verizon is getting ready to allow off-portal download of multimedia content such as ringtones, wallpapers, games, etc. The first programs are scheduled to go live in April/May. Preliminary pricing points to a fixed outpayment percentage regardless of retail price, which is different from Verizon's regular outpayment schedule. This means that outpayments are going to be relatively more interesting for lower price points (<$1.99), and less interesting for higher price points.

Dobson, Alltel and chat

In addition to Verizon, it appears that Dobson has now also put a hold on new chat programs where as Alltel is following Tmobile by limiting the premium billing of chat services to 99c. As a result, it is increasingly difficult to launch cross-carrier chat services on new short codes. Here's a summary of the limitations by carrier for chat services:
  • Verizon: on hold.
  • Cingular: no limitations.
  • Sprint: limited to 50c per message. Human content filtering required.
  • Tmobile: limited to 99c per message
  • Alltel: limited to 99c per message
  • Dobson: on hold.
  • Nextel/Boost: no limiations.