Mobile operators unprepared for A2P


New international research reveals less than 25% of mobile network operators have deployed next generation firewalls necessary to identify and charge unauthorised traffic

The majority of mobile network operators are not able to properly manage or make money out of SMS traffic, according to a new study.

Altogether, 75% of mobile network operators do not have the measures in place to control and monetise the application-to-person (A2P) SMS traffic that traverses their network, shows market research by analyst house mobilesquared and telecom-web convergence provider, tyntec.

Although the majority of surveyed operators indicated their year on year A2P SMS growth grew between 6% to 36%, less than 25% of them have actually deployed or updated an SMS firewall since 2012.

Firewalls that were installed before 2012 are unable to provide the message visibility needed to detect and control gray routes and other security threats, claimed tyntec. Therefore, having a properly managed next generation firewall in place is a prerequisite for mobile network operators to be able to block security threats, and identify legitimate traffic which can be monetised.

The potential of this overlooked revenue opportunity becomes even more key considering that 56% of survey respondents have experienced A2P messaging traffic growth in the last 12 months, compared to 49% over the prior 12 months, the survey showed.

The A2P SMS market is growing fast, with Ovum estimating that A2P SMS accounted for 24% of total messaging traffic in 2014. It is estimated that A2P traffic will grow to 2.21 trillion in 2017, by which point it will represent 31.3% of total messaging traffic.

Despite the growth of the A2P SMS market, mobile network operators are in protection mode, the study stated. Mobilesquared’s 2015 research reveals operators associate the rise of A2P SMS with increased spam and illegal messaging attacks on subscribers via their networks. They do not, however, have the sufficient network security tools in place to control and manage this and as a result, are also losing out on monetisation opportunities.

Key findings of mobilesquared’s 2015 research report “Secure Networks Key to A2P Monetization” include that less than 25% of mobile network operators have deployed or updated an SMS firewall since 2012. However, two thirds of mobile network operators using SMS firewalls reported a huge reduction in unauthorised messaging traffic.

Gray routes account for two thirds of A2P SMS traffic, meaning currently only one third of A2P traffic can be monetised by mobile network operators, the study showed.

Also, spamming is considered the greatest network threat, followed by spoofing (messages sent illegally by simulating a roaming subscriber), and virus distribution (messages luring subscribers to a download site with viruses).

Finally, the most popular near-term monetisation strategies are domestic and international A2P SMS, followed by portability and phone verification information, Internet of Things and M2M, and lastly A2P messaging via operator-owned OTT apps.

Said Stefan Kuehne, director of carrier management, tyntec: “SMS firewalls pave the way for clean and legitimate A2P messaging growth. Through using an effective, properly managed SMS firewall, mobile network operators can gain control over their A2P traffic, and open up their secured networks to legitimate A2P use cases, providing them with a termination fee for each message delivered to their subscribers.”

Nick Lane, chief insight analyst at mobilesquared, commented: “The A2P SMS revenue generating potential for mobile operators is effectively the Eighth Wonder of the World, at least in the wireless space. Mobile operators have been scouring the landscape to find ways of getting in on the OTT communications act, but with next generation SMS firewall solution, they can access the even greater enterprise messaging traffic opportunity.”

Research was conducted by mobilesquared during August and September 2015. Primary research involved an online survey of 25 mobile network operators, and interviews with the A2P messaging ecosystem. This was supplemented with secondary and tertiary research (primarily online based), and mobilesquared’s inhouse market data.


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