13 Aug 2014
Rich Communication Services RCS: Evolution not Revolution
Alex Duncan, CEO Openmind gives some key insights into the way RCS Rich Communication Services technology is developing and how it will be used.
The mobile industry seems to be incredibly focused on searching for a business case for Rich Communication Services (RCS). At the moment, operators are wrestling with justifying the upfront investment in an IP Multimedia Subsystem (IMS) platform required for RCS, irrespective of what else they plan to do with their IMS
Despite this ongoing cynicism, several recent events may provide operators with an added impetus to look at RCS once again. First of all, China Mobile, the world’s largest carrier by subscribers, recently revealed it will trial RCS. Delivering IP messaging, voice and video services to such a large number of subscribers could go a long way to disproving the RCS doubters.
Secondly, the GSMA has unleashed an initiative designed to help operators address, and navigate, the complexities of progression to an all-IP network – Network 2020. Thirdly, and perhaps most significantly, Facebook made the move to acquire WhatsApp for $19 billion. The social media giant’s largest acquisition to date makes the OTT messaging space even more pervasive, in terms of the new communities such a merger will enable around the world.
Alex Duncan, CEO at Openmind, is a firm believer that RCS is the only way in which operators can re-engage users. He feels that RCS can meet users’ current expectations of messaging capability and usage – which have been set by OTT providers. RCS supports operators in the development of messaging services that are comparable to the likes WhatsApp. Fundamentally, RCS is the platform which enables operators to retain relevancy in the minds of customers.
Rich Communication Services, RCS is a technology that was born to halt fragmentation and interoperability issues arising in IP-based communications. Previously, IMS vendors tended to take their own approach to launching IP-services. As a response to this trend, the GSMA launched RCS as a vehicle to enable mobile operators all over the world to provide a standardised, uniform approach to IP-communications. RCS is the development of messaging, voice and video capabilities from a legacy circuit switched network environment to an all-IP one.
The GSMA’s initiative to drive Rich Communication Services in the market, Joyn, has been impacted by a lack of expenditure in IMS infrastructure by operators. There has been some more limited investment in IMS for certain use cases - such as Fixed Mobile Convergence (FMC) to deliver fixed line services to customers; and for Enterprise IP Private Branch Exchange (IP-PBX) to provide internal phone systems to multi-national corporations. But the financial downturn in the market has created an exceedingly difficult environment for operators to make any investment, let alone in in IMS-based RCS.
The RCS initiative came under the control of the GSMA in 2008, off the back of a growing industry initiative in 2007. Early conversations in industry circles tended to centre on how RCS could be leveraged by operators to compete effectively against OTT players. Thankfully, this ‘them against us’ discussion has now evolved. Many now take the view that the communication services operators provide must be enhanced. The feeling is that these services must now incorporate the richer feature set that OTT apps already deliver. This is a positive development, as the debate about operators using RCS to compete against OTTs completely misses the point.
Mobile operators are increasingly going to deliver IP-based communication services as they provide the experience users have come to expect from OTT apps. While there is no monetary business case for RCS, it does have a business case in providing a user experience to enable operators to reduce churn and support customer retention. As operators undergo this transformation, OTT players will continue to deliver their own voice, video and messaging services.
RCS – the Reality
The messaging market has increasingly been invaded by OTT players, such as Line, Skype and WhatsApp. Operators are aware they cannot change this fact, or face down OTT competition by deploying RCS. OTT messaging services have been able to establish themselves with consumers simply because they’re more attractive and, importantly, they are free. This is a notion that many operators struggle to compete with. However, operators should not be concerned about going to market with ‘free’ Rich Communication Services.
The transition to RCS is now much smoother and the costs much lower than originally perceived. In the long run, RCS provides many of the features that users have come to expect from OTT players. The difference is that mobile players can deliver them with higher reliability and superior service quality than OTT providers could hope to provide. This is what can enable operators to re-intermediate themselves with consumers.
In a bid to improve their offering to customers, operators have focused heavily on deploying LTE to boost data speeds. LTE also enables operators to charge a premium for these higher data rates and reap larger data revenues – as LTE users consume a lot more data. This move is beneficial to RCS, as many operators moving to LTE have opted to deploy Voice over LTE (VoLTE). Embracing VoLTE enables voice, data and video services to be more cost effectively, and simply, delivered over a single IP network. VoLTE also acts to protect operators’ voice revenues as they can, once again, charge a premium for higher quality HD voice calls. But why is this relevant to RCS?
Both VoLTE and RCS share the same IMS investment and capabilities, thereby spreading the CAPEX burden between the two services. If an operator has made this initial investment in IMS for VoLTE, it is then a straightforward and affordable process to install an RCS application server into the network. Operators moving to VoLTE have completed the heavy lifting in the network. The initial IMS integration and cost is taken care of, so why not add in Rich Communication Services into the offering too?
A further market boost for RCS comes in the form of its next iteration from the GSMA – Crane. Crane combines both RCS and VoLTE into a single client which can be embedded onto the handset. As part of its Network 2020 initiative, the GSMA is making the 'green button promise' for Crane. The green button is typically the one that users press to make a voice call. This button is associated with high quality services and interoperability. The GSMA feels that it is a fundamental requirement to embed these principles in all IP-based operator services as well. The mobile operator trade body agrees with the point of view that this approach is the only way to fulfil customers’ expectations that services initiated by the calling or messaging buttons - will be high quality and fully interoperable, regardless of network.
Some operators have even chosen to take an approach to RCS which removes the network from the equation completely. A hosted Rich Communication Services solution, in which a hosting provider delivers the entire range of RCS services through the cloud to the operator, enables a rapid launch of RCS services into the market. Subscribers can begin to use RCS services and the operator can make a judgment on what is, and is not, working with no large-scale CAPEX outlay involved. After taking this route, the operator can bring RCS into the network and scale it up as RCS market traction improves. This approach unearths real advantages for operators – as they will know what RCS services will be effective for them – prior to making any major IMS investment.
It is this set of market factors which is enabling the previously panned RCS to finally take a foothold in the global market. Indeed, 55 operators have committed to launching RCS this year and 85 players have said that they will launch the technology by 2015, according to the GSMA.
It is a healthy time for RCS. Market factors are driving its growth and operators are coming to the conclusion that RCS enables them to retain relevancy with their customers – not compete more effectively against OTT rivals.
RCS gives operators the ability to deliver features, such as presence and location information capabilities, which are directly comparable to OTT functionality - which has proved to be incredibly popular with subscribers in the market. If operators can achieve that same look and feel as OTT services, they can begin to stop the perception among consumers that they are the poor relation of OTT providers. They can work towards encouraging users into an ongoing interaction with operator controlled messaging applications. RCS will offer subscribers greater choice and flexibility in the way they communicate, but will run in tandem to OTT messaging, voice and video apps. This also comprises in-app messaging, WebRTC-based apps and traditional SMS/MMS and circuit switched voice, for the time being.
In reality, Rich Communication Services is the only viable route operators can take to satisfy user expectations, via the relevant services they are used to. Offering these new IP services also enables operators to support a sustained revenue line – not a significant increase – and gives operators the table stakes needed for customer retention. It is more likely that any efforts to monetise RCS will come from applications developed by operators, through their own Application Network Interface (API) ecosystem, for vertical industries and consumers.
However, RCS isn’t about delivering a competitive response to OTT service providers. It’s going to happen because it is a technological evolution of messaging and voice, with new video services, in an IP world, that delivers a much richer and expected user experience.
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About the author
Alex has led Openmind through significant changes, from a zero revenue base to a multi-million dollar global enterprise with telecommunication customers in all parts of the world. Alex is responsible for leading the Openmind team to greater growth, through the development and implementation of the company strategy. Alex holds two Trinity College, Dublin, Degrees; a Master's Degree in International Business together with Bachelor's Degree in Electronic Engineering.
Openmind's Communication Platform is deployed in over 120 sites across 30 countries in Europe, Middle East, Asia and North America, powering over 1 Billion transactions every day. Customers include Mobile Operators, Inter-Carrier Operators, Social and Media providers and more recently, direct to consumers in the App space. The technology provides a gateway for communication and the transfer of data that takes place between individuals, groups, Apps, Service Providers and machines. The platform offers their customers all of the interfaces required to deliver and develop these services. Openmind (www.openmindnetworks.com)is headquartered in Dublin with regional offices in the Czech Republic, Germany, UAE, USA and the Netherlands.
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