It’s all too apparent that there’s a new wave of messaging on its way the advertisements are everywhere. But how accurate are they? Will we be able to send pictures of ourselves across the network and if we can, can anyone actually look at them? More importantly, does anyone actually want to and if they do, how much will it cost them? These are all questions that need answers before MMS can be successful.
MMS is being hailed as the new SMS but there are a number of factors that must be taken into account in order to get it right. Basically, MMS enables the creation of multimedia messages with ‘rich’ content, including images, audio, text and video, that are delivered over GSM/GPRS networks. This is easier said than done, however, because there are wider implications in terms of service delivery, service quality, ease of use and understanding and, of course, the price.
The inability of the WAP standard to deliver on the promises of access to the ‘wireless web’, as expounded by overly colourful media campaigns, means that there are also some rather painful lessons to be learned.
The telecommunications industry has positioned picture messaging as the service that bridges the gap between text messaging and the variety of media-rich content and services that will be available on 3G networks. But a successful move from text to image and other types of messaging requires not only the perfect blend of technology, quality, price and usability, but also demands that attention is paid to lessons from the past. Too much or too little of any ingredient will create an unusable and unprofitable service.
If the market is indeed ready for MMS has the industry really thought about how to effectively deliver MMS to ensure its success? A change in approach is needed to drive demand for MMS. In an attempt to create a buzz and win subscribers, the industry refers to the superficial similarities between SMS and MMS. However, beneath the surface, MMS and SMS are nothing alike.
In general terms, SMS has its roots in narrowband telecommunications signalling and MMS is rooted in internet-based protocols carrying richer message formats and more complex content. In practice, it means networks require the capacity to carry heavy data loads for messaging, well in excess of what is required for SMS. They also need the ability to manage, store and manipulate both messages and their content tasks not required off an SMS network.
What is required even more urgently, however, is user-friendly technology. A combination of multimedia messaging service centres (MMSCs ), networks and handsets, interoperate collectively to provide a consistent, ubiquitous and useable service for end users. Each element is equally important in delivering services to end users and a shortfall in any one of these will cause a service to fail.
It’s all well and good to invest in an MMSC capable of handling transaction rates for video but if your network can’t deliver MMS with videos, and handsets can’t handle them, it amounts to an empty promise something end users won’t tolerate. At a bare minimum, network performance must be at least as good, but preferably better and more reliable, and MMS terminals must be easy to use to ensure success. In other words, your service delivery chain is only as strong as its weakest link and the extent of your MMS promise is bound by that link.
Usage costs
From a service offering perspective, there are wider implications in terms of costs and pricing. Aside from the costs associated with infrastructure investment, the main usage costs for MMS are transport and manipulation, or media transcoding. Costs can vary greatly depending on the message size and amount of manipulation required as it travels across the network.
In turn, this affects service pricing; in order to maintain cost stability, diligent network management is required to minimise the number of transcoded messages and prevent unnecessary increases in message size due to transcoding.
A primary technical decision depends on whether the MMS policy focuses on encouraging adoption of reasonably priced MMS handsets or adapting MMS content for the lowest common denominator to support MMS on non-MMS devices. If your decision encourages adoption of reasonably priced handsets, then the ‘default’ image quality becomes that, whatever the handset is able to support, and can be delivered by your network in a reasonable time, at a profit.
So there are still technical challenges at the network and handset levels to overcome when offering a quality MMS service to the end user. Ultimately, it comes down to what the user considers to be acceptable quality, as this dictates what they are willing to pay or even if they are willing to pay at all.
IT is folly to over-promise and, as we all know, a successful service sets realistic and positive expectations while delivering a positive experience. Users will only accept a service that is visible, useable and offers security in the knowledge that a message sent becomes a message received. Anything less will result in a negative experience, undermining its chances of success.
Expectations are set and managed by way of media campaigns and other major influences, including handset vendors. From an implementation perspective, considerations focus upon what is achievable and most cost-effective given budgetary constraints. Key questions include: how much bandwidth do you allocate? Will it pay to allocate it given the price sensitivity of your market? Will you make ROI? If so, when? Are you setting your definition of a quality service too high, driven by the marketing images of tomorrow and what lies just beyond the rainbow?
Networks must be constructed to meet specific targets, but for that to happen, it’s necessary to know what these targets are. Much of what is needed to define these targets comes from user expectations. For example if you’ve sold ‘movie messaging’, then consumers will expect portable, mini-cinema screens. If MMS is oversold and you can’t deliver, then no amount of sharp pictures will make up for the gap between reality and expectation consumers simply won’t buy it.
Similarly, if you’ve sold ‘MMS for all’, regardless of handset type, the service delivered will be interpreted as an MMS experience and this will be what your subscribers’ judgements will be based on. In other words, it is equally as dangerous to undersell MMS as it is to oversell it.
Meeting expectations
In order to meet these expectations, service providers must acquire an in-depth understanding of customers’ lifestyles and requirements because it is necessary to know both what is to be achieved and what is expected to enable the delivery of a service that meets (or exceeds) user expectations, as opposed to the expectations of the industry itself. This is where pricing becomes important.
Pricing is a key driver with respect to both MMS services and handsets. SMS success was driven largely by the perception of it as a cheaper and easier method to communicate compared to voice and today it accounts for between ten and fifteen per cent of operator revenues. Its simple pricing structure and billing processes also drove the uptake of SMS subscribers know exactly how much they will be charged per message.
The success of SMS has led to huge industry expectations for MMS , but the industry must take its lead from the user base to prevent being seduced by technology and only selling to early adopters.
But aside from the costs associated with infrastructure investment at the network level, the main costs for MMS are transport and transcoding. At service delivery and handset levels, current pricing models are either too complex, too expensive, or both, to even begin to create the critical mass and demand required to make MMS a mass-market service.
At the moment, the UK has few available MMS-compatible handsets, all of them priced outside the reach of the younger, prepaid target market. The minimum price is £150 (234) for a SonyEricsson or Nokia terminal this figure includes operator-funded subsidies. From sneak previews of the new wave of handsets making it to the market in time for Christmas, ongoing subsidies seem to be the only way to gain entry to the UK market.
Interestingly, in Finland , where mobile penetration exceeds 80 per cent of the population, handsets have never been subsidised and Finnish consumers expect to pay the market price for a new handset.
Meanwhile, operators in the UK are experimenting with service pricing and packaging to see what the market will bear. After all, they have to regain handset subsidies somehow. However, the fact remains that service pricing is critical because services are targeted at a price-sensitive sector.
There are only two UK-based operators currently offering picture messaging and both have taken different approaches to pricing. T-Mobile charges subscribers £20 (30 ) a month (equivalent to 57 pence [89 cents] per message) for a ‘data allowance’, enabling them to send and receive 350 picture messages.
However, messages can only be sent within T-Mobile‘s network to someone who also has an MMS-compatible device. In comparison, Orange UK subscribers pay a flat-rate of 40 pence (62 cents) per message, need an MMS-compatible handset and the message has to be sent to a compatible device on the Orange network. Between the three remaining UK operators, O2 will adopt a message bundling approach, (30 pence per message [46 cents]), Vodafone favours the pay-per-message model and Virgin insists on network interoperability before launching its services.
Another potential stumbling block is that MMS is only available to contract customers, cutting out a large portion of the younger, prepaid target market. For the record, for MMS to be a mass-market success, operators have to work with other industry leaders to address any technical difficulties in getting their MMS platforms to communicate with existing prepaid platforms.
So the right approach to pricing is a simple one. Just because your network has the technological capability to speedily and accurately process even the most abstract of payment options, that doesn’t mean that your customers do or even that they can be bothered trying to work it out.
Complexity in pricing and billing is simply not needed. If it is too complicated, users will ignore MMS because the average subscriber has no interest in working out what it will cost them each time they send a multimedia message.
And what users want is what drives the market. MMS enables a potentially infinite variety of messages, so it makes sense to charge one rate for sending messages with personalised content, such as photographs, and a higher rate for messages containing premium content for example 20 pence (31 cents ) to send a message and 20 pence for content, which can then be divided between all the parties involved in the transaction.
Users won’t accept charges based on file size or data packets because they don’t care how big a file is. Most of them probably don’t even know what a kilobyte is and why would they? Operators should be making the most of the introductory period, doing their homework and measuring average file size to provide a yardstick by which to set prices.
The opportunity exists to avoid the same mistakes that were made with WAP. But at anything up to 57 pence (89 cents) per picture message that can only be sent to someone on the same network who also has an MMS handset, it seems the industry is stubbornly refusing to learn from experience.
MMS has the potential to become the de facto mobile messaging standard. As networks evolve and new services like video and audio become commercially viable, the MMS function on handsets will become ‘the’ messaging function, replacing other messaging clients, like SMS and e-mail, on mobile handsets.
The sending and receiving of text, images, video, audio and voice mail will all involve the same standards-compliant, universal messaging application that is multimedia messaging. Of course, the world doesn’t change overnight and it will take MMS some time to replace the legacy messaging systems such as SMS and e-mail. But the move is underway and will slowly gain momentum; with the combined, cooperative weight of the infrastructure players and handset vendors behind it, time is all that is required.
Philip Hayes
2003-03-12
This article first appeared in the 3GSM World Focus, a part of Mobile Communications International
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