RCS again? Yes, really, says Synchronoss CEO
A decade ago, operators made substantial investments in rich communications services (RCS) infrastructure but the promise never came to fruition and RCS became just another rusting hulk in the scrapyard of technological three-letter acronyms. Now, with operators desperate to monetise 5G and bring new experiences to customers, RCS infrastructure is being dusted off and primed for a second chance at success, Glenn Lurie, the president chief executive of Synchronoss, tells George Malim.
Lurie’s belief is borne out by focus group conversations conducted by Synchronoss which have brought together dozens of US consumers of all ages to discuss their mobile messaging habits. From these, and its experience with RCS in Japan, Synchronoss says it is able to show the value of the technology to operators and brands in terms of increasing subscriber engagement and creating new revenue.
George Malim: I didn’t expect to ever have another conversation about RCS, why has it jumped back from the dead?
Glenn Lurie: I think a few things have happened and trends around the globe have woken up the carriers to a new thought process. Over-the-top (OTT) players have gained lots of traction, especially in Asia with players like WeChat in China and Line in South Korea dominating their markets. Carriers are reacting to that.
Another key point is that carriers are in a very different place to where they were ten years ago when RCS was introduced. They put in the infrastructure around RCS and didn’t do much with it. Now, they’re looking at 5G with tons of capex and wondering how to get a return.
Close to 70% of the Chinese population go into WeChat every day and stay there. They’ve disintermediated the customer experience and people say within WeChat for taxis, food order, socialising and communication.
Carriers see that as a great opportunity and also fear they could get disintermediated themselves.
GM: What sets operator-provided RCS messaging apart from WhatsApp, Facebook, Apple and others’ messaging services? Can operators differentiate on privacy and security?
GL: The things that comes out loud and clear is trust. Carriers have good relationships with their customers and trust them with their data. This is so important when you think of the last ten years in terms of what you do on the device.
Carriers therefore have the opportunity to bring interoperability between services and to make it frictionless for the customer. They can present other opportunities and contain customer journeys within their four walls.
The challenge for them is to go out and get eyeballs and people who will utilise their RCS. Synchronoss is in Japan and the experience there is similar to the one we are going to have in the US. The key is for carriers to go out and market this understanding that they have this value and can offer the experience to customers.
Having an app to run your life is really a great vision. It gives the opportunity not just to have all their favourite people and brands and have experiences around them in a very unique way without having to flop from app to app. It’s going to be a big experience builder.
Don’t forget this is a one-to-one relationship of brand to smartphone and the amount of data and feedback is going to be the best there is.
GM: Where’s the money?
GL: To operate RCS, the money comes from the operators but the reasons are two-fold. You’re building it as a tool for your customers but also because if you don’t build it someone else will and your customers’ daily interactions will then be with someone else.
In terms of the business model, it will start out as application-to-peer and soon be peer-to-peer. At the same time, the next level of working with brands to build campaigns and get personal will emerge. This is customer-driven. It’s not like SMS or email – the customer drives the interaction.
We’ve talked to large advertisers and asked if there could be a third choice in the mobile advertising space after Google and Facebook and there is good potential if carriers can get the adoption in large markets like the US or Canada to get in the mix.
Of course, adoption depends on how old you are but if the products and services are pertinent and there’s trust, there’s an opportunity for carriers. Why would you go to an OTT and trust them with your photos, social media, banking and credit card information?
My opinion is that every carrier in the world is going to have to do something. If you don’t, messaging services will disintermediate you and take all the revenue opportunities up in the stack.