Just before this year's Mobile World Congress, Google announced that more than 40 mobile operators and device manufacturers now use its RCS platform (up from 27 this time last year).
He also used the event to share some of his early applications. In the US, household names like Booking.com and Subway are already sending RCS messages to Sprint customers, while in the UK, Barclays, Hermes, British Gas, Pizza Hut Delivery, and Foxtons are using RCS on Vodafone.
What is it? RCS?
Imagine you're on your way to the airport. Your phone pings. You have a message from your airline. Inside the message is your boarding pass with your name, barcode, departure time, departure gate map, and seat number. You don't want a window seat, but that's okay; you can click the "Change Seat" button.
It seems like everything's sorted out. But you still have questions. Well, just start a text conversation with the airline agent (or perhaps a chatbot) and ask away. This is a message, after all.
Well, yes, it's a message. In reality, however, this experience provided all the information, utility, and convenience that a native app typically requires. But with none of the expense of brand development. And none of the fans asked the customer to download one.
This is why many believe that a new type of multimedia message format could be the app's long-term replacement. Indeed, such a format already exists. It's called RCS.
Rich content
The Rich Communication Services (RCS) Universal Communication 2.0 standard provides messages that contain rich content features such as images, videos, and reply buttons that can link to other menus and functions.
It's essentially SMS 2.0. Now, global operators, in collaboration with Google, are building the infrastructure to bring RCS to every phone in the world. They're making progress. Late last year, the GSMA confirmed that 50 mobile operators have already launched RCS and that it currently has 138 million monthly active users worldwide.
At the time of writing, RCS is only available on Android devices, as Apple has not yet registered it. In the long term, it's possible that many hundreds of millions of people will use RCS as their default messaging service. In fact, the GSMA projects over a billion monthly active users by 2019. This would be equivalent to the three most popular person-to-person messaging apps used globally (WhatsApp, Facebook Messenger, and WeChat).
Naturally, many readers will wonder whether apps need replacing. After all, studies suggest the app market has never been healthier. This is true—up to a point. Analyst Sensor Tower reported that all-time global app downloads reached 23.4 billion in the third quarter of 2017, a 141% increase year-over-year. However, it also revealed that Facebook's four main apps—Facebook, WhatsApp, Messenger, and Instagram—recorded 582 million downloads in the quarter. That's almost half.
Development costs
The takeaway is obvious. Consumers love apps, but most only use a dozen. They simply don't have the overhead or phone memory for more. In fact, a 2017 ComScore study showed that 491 TP3T of US smartphone users download zero apps in a typical month.
This is alarming for businesses, especially considering the budget required to create an app. Experts say that development costs for e-commerce/transactional apps start at $ 200,000 (£145,000) and can reach $ 1 million. Brands know this. They've been looking for an alternative to apps for a while.
They examined HTML5 mobile sites, which offer many app-like features within a mobile web experience. However, web apps can cost tens of thousands of dollars and still require a user to fire up a browser and (in some cases) save the page to their mobile screen.
Advanced messaging seems much more feasible, given that laptops would ship with this feature set by default. Businesses can access a dashboard that allows them to easily send messages to a user database activated by a cloud-based system. The cost of these messages has yet to be determined, but many analysts predict that the cost will now be comparable to SMS and likely cheaper per message for long two-way conversations.
And obviously, any campaign that uses messaging will be interactive. RCS includes read receipts so marketers can run A/B tests, evaluate campaign success, and make adjustments on the fly to improve response.
Messages-as-a-platform
Perhaps the most compelling aspect of the "messaging as a platform" idea is that most brands are already engaging in this type of activity, but with SMS. They're using text to send delivery alerts, PIN codes, and so on. According to analyst Ovum, companies sent 1.16 trillion so-called A2P (application-to-person) text messages in 2016 and will send 1.28 trillion by 2019.
So migrating A2P from plain text to advanced RCS makes perfect sense. It goes without saying that the industry is working hard to encourage businesses to experiment. In February 2017, Google launched an early access program with select partners to allow brands to experience what it calls Rich Business Messaging.
The elephant in the room is how companies can provide seamless app-like communications when not everyone has an RCS-enabled device. (Some might point to Apple's current lack of support as another. – Ed.) To simplify this experimentation, brands can now use "fallback SMS." This ensures that the message always arrives (as plain text with a link) if an RCS device isn't present on the device.
The aforementioned Ovum research suggests that businesses are intrigued. It found that 36% plans to adopt RCS for business messaging. 89% is interested in using RCS for chatbot-based conversations with customers. And 61% stated that RCS support for payment platforms was a significant draw.
Over-the-counter messaging apps have been on a steep growth curve for some time now. Consumers love them because they offer a rich experience and can include features like sending money to friends. Companies see all sorts of benefits, but so far have struggled to add that functionality to their communications efforts. Now RCS promises to open up the market and force them to ask the question: why devote so much budget to apps when RCS can improve engagement for a fraction of the cost?
