When Apple's first iPhone was released in 2007, enabling consumers to use features only previously available through their computers, such as instant messaging and watching and sharing live video, rich communication services (RCS) became the industry solution for delivering advanced communication experiences across various devices on any network. Yet ever since, mobile operators and industry pundits worldwide have struggled to find a viable business case for RCS for a variety of reasons.
Try and try again
While RCS offered more advanced capabilities beyond traditional mobile voice and SMS, it required heavy investment from operators on IMS infrastructures, since the service runs on top of IMS, and the standard set of services defined by RCS -- audio/video call, file/image sharing, chat and messaging, provided limited opportunities to monetize.
At the same time, specialized third-party, over-the-top (OTT) voice and messaging apps with rich feature sets started to become available in the marketplace, often for free, and large communities started to form around these free services. As a result, the initial RCS value proposition rapidly eroded.
Since then, mobile operators have been experimenting with different pricing models for RCS and related services. For example, operators in Korea and Spain offered RCS completely free from the initial launch of these new services. One of the operators in Korea proposed per-usage pricing (per second for audio/video and per message for messaging) for RCS.
Another operator charged for regular data usage, deducting the data consumed by RCS services from the subscriber's data bundle. This turned out to be a weak pricing model because it was too difficult to track and made the business case for RCS unviable. Other operators have tied RCS pricing to that of their other messaging and voice/video calling pricing. For example, charging exactly the same price for an RCS chat as an SMS or text message, and charging RCS video sharing at a similar per-minute rate as voice calling.
The problem was that none of these pricing models justified the large investment in IMS infrastructure to support RCS services. Nor did it form the basis for a sound business plan to compete against OTT services. The adoption and commercial rollout of voice-over-LTE (VoLTE) by the mobile operator community alleviated some of the concerns about the economics of RCS -- since IMS was already being deployed as part of VoLTE, this high-priced item was removed from the RCS books. However, the math just didn't add up as far as the RCS long-term revenue model was concerned.
What seemed to be missing was a way to expand the scope of RCS to other monetizable IP services for RCS to be profitable. More advanced technology platforms like the GSMA RCS API Gateway, launched in 2014, and based on the GSMA OneAPI specifications, offers an industry breakthrough, by enabling mobile operators to easily build new IP services, and connect to existing IP services.
Each RCS application is implemented as a virtual client by the RCS API Gateway, appearing to the core as a regular RCS client, and controlled using simple web APIs by the developer to create a powerful combination that allows IP and Internet services to be rapidly enabled in the 4G/IMS/RCS network.
With this technology innovation, mobile operators can create competitive blended services by combining multiple IP-based services that leverage the power of RCS through more targeted, engaging customer propositions such as chat-based games, mobile learning, smart ads and promotions -- to drive consumer relevance and business revenue.
For example, a mobile CRM service using the RCS API Gateway uses RCS chat to conduct a personal banking session with a commercial bank or pay bills to a utility company. A second example of this technology is in home automation or industrial control in which the RCS API Gateway interacts with the Internet of Things network, making it possible to control devices through an RCS chat session.
RCS can also be put to work in generating revenues for operators through advertisements, specifically contextual advertisements in RCS chat. In this case, the RCS API Gateway connects to an ad server and serves up ads based on keywords during RCS chat.
In all of these use cases, the RCS API Gateway enables new revenue-generating services, making it possible for mobile operators to finally monetize RCS. Mobile operators who have deployed VoLTE (and hence IMS) in their network can capitalize on RCS and realize large untapped monetary benefits from their deployed network assets -- turning what was once a money-losing proposition into a gold mine for generating new revenues as well as offering cutting-edge innovative services to the operator's customer base.
— Mohan Palat, Director, Product marketing, Digital Services, Comverse Inc. (Nasdaq: CNSI), special to The New IP