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Danger to consumer confidence in A2P messages

by July 23, 2020No Comments

According to Telefonica, the annual volume of text messages sent is 8.3 trillion dollars. And then there are companies that are increasingly turning to messaging as a key technology for engaging consumers. Banks, medical clinics; media companies and charities are embracing SMS Application-to-Person (A2P) as the most effective channel for interacting with their audience.

And there is a good reason. In a world characterized by an ever greater digital interaction competing for ever smaller moments of consumer attention; messaging offers two vital ingredients: convenience and convenience. Dynmark's often cited research indicates that SMS has an open rate of 98%. SMS wins, chapter and verse.

And while there is definitely a shift towards messaging apps like Whatsapp is Facebook Messenger as a rich peer-to-peer alternative; A2P SMS messaging is growing hand in hand. The analyst firm mobleSQUARED expects the A2P market to be worth $ 58 billion by 2020 (rising from $ 12.88 billion in 2015).

The interesting thing about mobileSQUARED research is that it is unusually conservative. It represents growth based on mobile operators implementing revenue guarantee platforms to close the gray routes; not the market growth initiated by firms in the new verticals, the growth markets in countries that have not reached the "mobile peak" or innovation in new technology sectors such as the IoT. However, it points to the broader problem of fraud within the messaging ecosystem.

The gray routes, which fraudulently guide the operators' dedicated P2P [person to person] connections; are one aspect, but there are many other types of message fraud ranging from technical exploitation of vulnerabilities in a given network to more direct manipulation of consumers.

The prevalence of spam

Perhaps more concerning is the prevalence of spam and SMiShing (SMS phishing), common practices in both mobile messaging and messaging via chat apps.

Earlier this year, the global trading body MEF released the 2016 Mobile Messaging Fraud Report. It found that more than a quarter of consumers (28%) receive an unsolicited SMS message every day, and the 58% reports. having received one every week.

In messaging apps, the problem is only slightly less common; with the 26% of chat app users receiving an unsolicited text message every day, while the 49% receives at least one per week.

While most unsolicited mobile messages aren't much of a nuisance, such as notifying users of an unsolicited offer or service; the 33% of consumers said they received a SMiShing message with the purpose of tricking them into disclosing personal data such as bank details or passwords for online services.

MEF estimates that SMiShing contributes an estimated $ 680 million to the annual fraud cost of $ 2 billion currently incurred by mobile operators and consumers. It is also interesting to note that although the SMS channel receives the highest daily occurrence of unsolicited messages, it remains the most reliable with the 35% indicating it was their most reliable channel; against the 28% which trusts more in messaging apps and only the 18% choosing platforms such as Facebook, Yahoo and Skype.

This is likely due to the fact that the percentage of spam messages is still less than one percent of the overall message volume. Compared to email's roughly 50%, SMS is still a clean and powerful channel.

The correlation of costs

It is also true that there is a high correlation between the cost of delivering a message and the amount of spam and fraud that the channel attracts. For example, it could be argued that the reason for low spam levels in Germany and France is directly related to:

  • The cost of sending a message through legitimate paths is relatively high.
  • The effectiveness of local operators in those countries to block gray routes and filter spam is very good.

In contrast, India, Nigeria and South Africa have a relatively low cost of sending a message; although things are improving, these networks have historically been less protected. At the same time, in many early mobile countries, consumers are less likely to have email and SMS addresses, therefore, it replaces email marketing.

A lack of cost could be the reason why the study users 72% received unsolicited messages from messaging apps like Whatsapp. However, there is no official API for sending messages from Enterprise to Consumer on many of these platforms. This concerns as it indicates that the scammers are using weaknesses in capabilities; person-to-person of these apps to send messages on behalf of businesses.

Additionally, messaging apps will need to be cautious when switching to legitimate business communications if they don't want to replicate the fate of push notifications; where overzealous marketers have polluted the channel that is now trusted only by consumers' 16%.

There are several things that can be done to reduce fraud and spam across all channels:

Create a global shortcode, long number, or email address that can be used to report unsolicited messages. The easier we make it, the more people will do it. Ensuring these reports are shared across the ecosystem in an automated way so they can be implemented.

Operators must continue to install SMS and ss7 firewalls in their network to prevent gray and fraudulent routes from being exploited to send spam and SMiShing messages.

OTT apps need to bridge the weaknesses in their systems that allow individual user accounts to send large amounts of unsolicited undetected messages.
When OTT apps finally allow the legitimate sending of Enterprise-to-Consumer messages via an API; they must charge for the service on a per-message basis to ensure that both scammers and overzealous merchants do not abuse the channel.
Innovate on how cloud message providers; they can better validate the identity of companies to ensure SMiShing attempts are thwarted early and often.
While it is very encouraging that the A2P market is expected to grow in the coming years, we cannot take consumer confidence in the platform for granted.

Clearly the industry needs to implement measures that protect and fuel trust as drivers of future growth in new verticals and innovation in new technology areas such as IoT and machine-to-machine messaging.

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