The expansion of mobile network services and subscriber growth is as robust as ever, with short message service (SMS) maintaining its position as the most popular data application in the market. Its popularity with subscribers requires an ever-increasing investment in network capacity, while rewarding service providers with increased top-line revenue- but only if the demand can be satisfied efficiently.
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| Harris: SMS’ phenomenal growth can only continue if demand can be satisfied efficiently. |
A harsh reality in the SMS market is that higher volume has not brought service providers proportionately increased revenue. For example, Gartner projects worldwide SMS traffic to increase 19.6% in 2008, with only a 15.7% increase in revenue. In the United States, CTIA reported a 157% increase in messaging traffic from December 2006 to December 2007, while average monthly bills dropped 1.5%. Clearly, service providers need to increase capacity, while driving down costs.
Changes in the SMS commercial landscape also have driven changes in messaging solution architectures. Availability, density and performance requirements are all in flux, giving rise to a new set of challenges for SMS service providers, including:
- The advent of extremely high-peak volume applications, such as mass voting for TV shows, increases the maximum capacity service providers must provide if they wish to play in this growing segment.
- Cost competition from niche players, MVNOs and established network operators is driving down the revenue per user. As of Spring 2008, the U.K.’s Orange offers unlimited texting for £15 per month, while most U.S. operators include unlimited messaging in their $99 per month “all you can eat” voice and data plans. In the face of these pricing trends, mobile operators must consider new architectures to help meet high-peak traffic demands at a reduced cost.
- The enormous growth of the SMS market is challenging technology and business models; as usage and volume continue to rise, intense competition creates pressures to lower SMS solution costs in order to deliver an affordable service.
- The efficiency needed to lower costs while increasing volume requires an investment in more efficient network technologies. In the case of SMS, this has encouraged new solutions from vendors.
Vying SMS Architectures
In a traditional SMS architecture, every message is stored and forwarded to its destination using a short message service center (SMSC), which includes a gateway to all content stored on a network. Although the cost of SMS infrastructure is significant, the potential return from each deployment is normally high enough to pay for its construction and annual operating costs in less than two weeks.
Newer architectures have introduced the SMS router, which eliminates the need to store messages and delivers each message immediately if the recipient is available. As phone battery life has increased, and more subscribers keep phones on at all times, immediate delivery has become a larger portion of messaging traffic. This, in turn, has reduced the need for additional “store and forward” capacity, reducing costs.
SMS routers have become the facilitators for new applications and features that do not require storage but need fast and responsive signaling, such as sports alerts and spam filtering. Adding a router also significantly reduces the cost of message delivery attempts per second (MDA/s) and enables thousands more MDA/s to satisfy increasing volume requirements.
To fight competition from vendors touting this new architecture, suppliers of traditional SMS equipment have modified configurations to allow direct delivery and SMS filtering, resulting in lower platform costs. The competition between “traditional” and “next-generation” solution providers remains fierce, but has helped mobile operators keep costs down and ultimately benefits subscribers.
Finding the Right Architecture
In the search for low-cost, high-performance signaling, SMS solution providers have tried many different combinations of products and technologies. This has been difficult, particularly when a promising solution requires migrating applications from one equipment platform to another.
When high-volume, low-cost MDA/s is the goal, a signaling architecture must provide high performance, yet be able to interoperate in a variety of network configurations and be flexible enough to be easily scaled when high-peak volume is anticipated. It also must use components that are competitively priced, but also have a predictable cost per MDA/s and interface seamlessly with other SMSC components using various protocols, eliminating any need to change suppliers.
Delivering price-performance first requires a scalable and configurable architecture; a high-performance solution is not cost-effective if it delivers more or less capacity than needed. Realization of right-size capacity in an SMS system requires precise management of messages and processing resources.
Although architecture is critical, the nature of the deployed application has a high impact on the network as well. Enough processing power must be available for the application’s demands, and the best way to assure enough power is to use the hardware acceleration available from either channel-sized links or high-speed links to process as many of the protocol layers as possible (such as from MTP3 up to MAP) on a signaling board. It is important to make sure each application is written to take advantage of hardware acceleration.
To find the perfect blend of performance and price for signaling solutions, developers of SMS platforms must be able to accurately predict the capabilities of underlying building blocks.
Success with SMS lies in balancing cost and performance by choosing the best architecture and then building with the right components, because it is the marriage between architecture and application that delivers the performance and efficiency needed for today’s mobile operators.
Harris is director of Segment Marketing for Dialogic Corporation.
Filed Under: Carriers, Devices
