SMS for Dummies - and how to profit from it...

[Emjay]

The fact that SMS (Short Message Service) was almost added as an afterthought when the GSM Mobile network – as used us by 80% of the world’s population – was first conceived makes the phenomenal popularity it enjoys all the more remarkable.

In the early days, the cellphone operators even had a ‘gentleman’s agreement’ to terminate each others SMS at no charge. Now data traffic accounts for an increasing proportion of the operator’s revenues.

More than a staggering 20 billion text messages are sent each month, and it’s still growing.

It’s popularity can be attributed to the fact that it’s direct and immediate. No waiting for hours while you wait for someone to return your voice message.

Furthermore, it’s discreet - unlike loudly talking into your handset in public. It’s generally cheaper than a long phone call.

The ‘product’ itself is spectacularly unspectacular. Only up to 160 characters of text. Unless, that is, it is used to carry small amounts of data – hence the popularity of the hugely successful ringtone smd logo cellphone tuning market. Part of this can be attributed to the ease of puchase. The customers pays via their phone bill (ie on credit), and product delivery is immediate. A neat billing/delivery cycle – all with no chargebacks!

And the good news is, you can now capitalise on SMS by using it as a billing mechanism for surfers to gain access to your website(s). This way, the cheap tour takers who never converted before will actually become paying customers. And they will love you for it – no more messy credit details – if they have one – and, above all, their anonymity is maintained.

This way you could offer, for example, 24hrs access to your member’s area for €4 – a good solid currency nowadays! If they like what they see, they can sign up with your current credit card processors in the normal way.

This is achieved via the Premium SMS (PSMS) billing mechanism. This can be compared to a 1-900 number. The end-user ‘texts’ his or her order to a five digit shortcode which is charged at a premium. They immediately receive an SMS back containing the reference number needed to ‘unlock’ your members area. You remain in full control, and dictate both the price points and the length of access that the customer will become.

Unfortunately, PSMS is not yet a viable billing option in the North American market, but is supported in most other developed countries.
One company that has been at the forefront of offering such billing and delivery solutions are the UK based www.txtnation.com. Their product www.menable.net allows websites to charge for content with both PSMS and regular premium rate (voice) numbers. They have interconnect revenue share agreements in place with all the cellphone carriers. Implementation is both quick and easy. A list of all tariffs and payouts available can be found at http://www.yourmobilebusiness.com/payout.php