2nd - Oct - 2018

The Price Must Be Right for RCS Success

It’s not just the mobile industry that is ready for RCS (Rich Communication Services). 

Brands and enterprises are also eager to embrace the next generation of business to consumer SMS messaging, which promises to help super-charge customer service efficacy.   

The success of RCS will depend heavily on a number of factors, but one tops the bill, how will it be priced? Most businesses and service providers we talk to expect to pay a little more for the enhanced functionality of RCS, however, if it’s too expensive or complex, they’ll stick with the ubiquity and simplicity of SMS.   

The suspense for concrete pricing news and structure from mobile network ecosystem continues, so we decided to act and poll the industry on what it thinks RCS pricing might look like.   

We recently surveyed over a hundred enterprises, operators and messaging providers across North America, Europe and Asia and here’s what we discovered:  

Enhanced functionality won’t mean excessively increased price 

Most respondents think that RCS is likely to cost brands initially no more than 20% for comparative outbound messaging. This is good news as it means the industry is committed to the success of RCS and not trying to be greedy. The business outcomes, read rates, and interaction rates already speak for themselves in terms of the return on investment from marketing dollars, for example.  

Pay per message pricing will support an easy transition from SMS  

How brands and businesses might be charged for setting-up and distributing RCS campaigns will also be key.   

The survey showed that a mix of pricing strategies will apply, including the most familiar model which is per MT (Mobile Terminated). Some MNOs plan to emulate the short code model that exists in many countries, and apply this to the chatbot (brand definition, bot or sometimes referred to as a ‘chatbot’ agent).   

Who pays for the data consumption? 

Over-the-top application users pay for the data it costs to receive a message from a brand or business. This is an explicit choice from the subscriber when downloading the relevant OTT application and opting in to communications. For RCS, we are talking about the precious, native inbox. The views were wide ranging, from zero-rating data consumption, to user pays through to sponsored data from the brands / MNOs. Whatever happens, bill-shock absolutely must be avoided for the subscriber.  

70% of our respondents expect to charge per MT message, while only 37% said they will charge for MO (Mobile Originated) messages. The majority (63%) of respondents will charge for delivering rich media (e.g. video, picture, sound file), while 37% will charge for location and 20% will charge for read receipts.  

SMS and RCS will work together  

While there have been thousands of articles proclaiming that “SMS is dead”, it certainly looks like RCS isn’t about to kill the text message off just yet.  

Most companies (67%) we surveyed expect to offer SMS/MMS (where available) alternatives as part of their RCS solution.  

While our survey was limited in size and region, it does provide a fascinating snapshot of how RCS pricing might look. The good news is that the barriers of entry for brands and businesses look low, and the costs for upgrading to a transformative new messaging standard shouldn’t impact the uptake of RCS.  

Contact us today to get started with an RCS trial, anywhere in the world. Even if there are no RCS-capable network operators in your country / region, we can support your testing and learning activities. There are exciting possibilities with RCS, as well as work required to tailor content and two-way conversation flows through to natural language processing. 

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