RCS messaging is becoming a key platform connecting brands with consumers, joining the list of mainstream marketing channels alongside TV, the internet, and social media, according to the findings of a new report by business messaging intelligence experts, Mobilesquared.
By the end of 2024 there will be more than 3 billion RCS users, representing a growth rate of 294%. This high rate of growth is set to position RCS as the largest enhanced messaging platform globally and provide new revenue opportunities for mobile operators.
The report, Safeguarding Revenue from A2P Messaging, published by Mobilesquared in partnership with Interop Technologies, highlights how RCS’ growth will help operators remain at the centre of mobile messaging.
Mobile operators need to take a holistic look at their A2P strategy to ensure current revenues generated from SMS aren’t being left on the table.
Jim Dwyer, SVP, Interop Technologies
The only business messaging channel currently generating sizeable revenue anywhere in the world remains A2P SMS. Brands spent $17.9 billion on the channel in 2020, and that will grow to $18.94 billion in 2021. Mobile operators hold a very dominant position when it comes to business messaging for now.
However, with the growth of OTT messaging, they need to safeguard future messaging revenues by consolidating legacy messaging and migrating subscribers to an RCS messaging platform to capitalize on its continued growth and next-gen technology synergies.
As the official 5G messaging service, RCS is expected to become an essential vehicle for generating future messaging revenues for mobile operators. Consumers are already reliant on rich messaging, brands want it, and mobile operators need to deliver it.
Based on existing RCS and MaaP deployment plans from around the world, Mobilesquared forecasts that RCS will generate revenues of $8.3 billion by 2024 from the traditional telco A2P SMS model.
Delaying an RCS launch will only risk mobile operators’ ability to generate new messaging revenue and their position in the channel.
Having a robust messaging platform is now seen as a vital component in mobile operator competitiveness, to such an extent that it can improve subscriber quality of experience and also reduce churn. By developing a native RCS offering to subscribers, it ensures that mobile operators remain at the centre of the next major platform, both for consumers and for brands.
Over 3 billion people use rich messaging, so if the mobile operators want to ensure their platforms remain relevant to their customers, they must evolve SMS into RCS. SMS has served them well, and in an A2P environment will continue to do so, but the level of engagement on rich messaging takes the opportunity to a different stratospheric level altogether.
Nick Lane, Chief Insight Analyst, Mobilesquared