Quo Vadis A2P SMS Ecosystem?

Giovanni Benini, Director of Product Management - Global SMS – September 22, 2016

Are there more or fewer players in the market today?Picture of The Christian Martyrs Last Prayer

As I returned from a very busy Wholesale World Congress (WWC) where many SMS players assembled in Madrid, Spain, I wondered if there are more new players or if market consolidation actually reduced the number of companies that offer A2P SMS services.

There are fewer players!

Of course, the news of this year on the acquisition front was CLX buying Mblox. Two major SMS players became one, and Mblox had swallowed CardBoardFish previously, so actually three became one.

In addition, there have been other activities like iBasis selling their A2P SMS business to MessageBird, and LINK Mobility’s acquisition of Whatever Mobile. Furthermore, several established players are on the market to be acquired, so I believe this trend will continue.

There are more players!

I see more and more voice players extending their business to A2P SMS, and they were all present at WWC. One example is BTS, a leading global voice termination provider, who now has SMS in its portfolio. Or Akton Communications, a voice and data telecommunication provider in east Europe, who told me how excited they are about their recently launched SMS activities. But new SMS players also come from other corners. Tata Communications runs an extensive SS7 network globally and decided few years ago to not only charge a fraction of a sub-cent for every SS7 signalling unit, but leverage that network to send full SMS for a few full cents. Another completely new and very different player is Amazon’s cloud computing platform AWS that recently added SMS functionality.

The bottom line

Which trend will win? Is the rate of consolidation stronger than the degree of newcomers joining the SMS ecosystem? Both trends are fuelled from the overall growth of the A2P SMS space. I believe that in the next few years, the “social divide” will increase. While the overall number of players is going to grow, the big players will become even bigger and distance the mass of other players more and more, who will try to find their niche to survive and prosper.

And by the way, if you are a large enterprise and have SMS needs, I can objectively tell you that you don’t need to look any further into the zoo of SMS players – contact OpenMarket today! 😉

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