TCS Text-Messaging (SMS) Patent - who is affected?

It seems strange to me that there is so little public discussion about the rather sweeping SMS patent enforcement campaign by Telecommunication Systems, Inc..

A little over a year ago, Telecommunications Systems (TCS) and their attorneys started sending out letters to SMS service providers and their clients across the country. TCS claimed that they were infringing on the “Smith” patents (US Patent #'s 6,891,811 and 7,355,990) that cover MO (mobile originated) SMS application-to-person (A2P) services.

I was curious so I downloaded both patents and spent a day going through them. The claim is that many SMS service providers are infringing on the patents because their services enable a person to send an SMS message to an application and receive a response. Pretty basic.

In a nutshell, the general scenario is:

1. A cell phone subscriber sends an MO text message to a short code (its doesn't have to be a short code, but this is where TCS appears to be focusing)

2. A "gateway" server receives the text message, inserts it into an HTTP request, and sends it to an application server over the internet

3. The application server replies via HTTP with some piece of information

4. The gateway server inserts the piece of information into a text message and sends it back to the cell phone

The key elements are that A) the mobile originated (MO) SMS must be inserted into an HTTP request, and B) the HTTP response must in turn be inserted into a mobile terminated (MT) SMS message and sent back to the cell phone, thus establishing a two-way communication.

There is some debate as to whether or not "prior art" exists bringing into question the validity of the patent. The most compelling case seems to be from Kannel.org, the open source SMS gateway provider. Kannel states “This technology has been Open-Source since at least 1999 and there is plenty of documentation to prove it publicly on Kannel.org.”

Nevertheless, TCS does have a registered patent with USPTO and they can and will attempt to enforce it. All technology firms using SMS communications should review their services in light of these patents and determine if they are at risk of an infringement claim.

For more information on the patent, industry comments, etc., there is a great article on mobilemarketer.com.

Steve

The Debate: Are Shared Short Codes Safe?

A short code is a 5 or 6-digit number that is used for routing text-messages between cell phones and mobile services. (See our earlier post for a description of why you might use a short code in your marketing campaign). Wireless carriers route the messages through a connection aggregator to the application service provider (ASP) who is leasing the short code. Almost all wireless subscribers in the USA are able to access short code services.

A “dedicated” short code is dedicated to one company/brand for their text-messaging service. A “shared” short code is shared by multiple companies and runs multiple services.

Its nice to have your own dedicated short code, but it comes with a cost. The lease fee alone (paid to usshortcodes.com) is $500 per month ($1,000 for a vanity code). You also need to contract an aggregator to provision your short code and an ASP to build and manage your application – the costs add up rather fast. Not to mention that it takes 2-3 months to provision a new short code.

Shared short code providers offer an inexpensive alternative. The shared codes are often used in conjunction with “self-provisioning” platforms that allow users to easily set-up and manage their own text-messaging services. Easy-peasy, so why would anyone want the hassle and expense of a dedicated short code?

There are a three reasons that I can think of-
1) No need for a keyword. If you do not want to use a keyword to route incoming messages you need a dedicated short code. For example, with text-to-screen services, its more user-friendly to ask the audience to simply text a comment, not text a “keyword” plus a comment to the short code.
2) You want to pick your own short code. Maybe for branding purposes (46835 'spells' INTEL) or you want a number that is easy to remember (like 20202).
3) You are worried about the other services running on the same short code.

Its #3 that causes people a lot of concern especially with the recent case where Clickatel's USA shared short code was disconnected by the wireless carriers when some "rogue" users ran non-compliant services (see story). It could also be that you just don't want your company or service associated with the $9.99 dating service running on the same short code.

But what if you don't have the budget to go the dedicated short code route? Shared short code services are a perfectly viable option. How can you protect yourself when using a shared short code service? Take a few precautions:
1) Try to stick with service providers who have been in business for several years.
2) Be wary of using any shared code that also uses self-provisioning services. It is virtually impossible to keep all services in 100% compliance when users are setting up their own services.
3) Ask the service provider about the other services that they are running on the same short code and have them outline the precautions they take to keep the system carrier compliant.

Once your service gains some traction, consider leasing a dedicated short code and shop around for the best deal for a connection. Don't just go to aggregators, ASPs can often provision your code on their existing network bind for a fraction of the cost (list of ASPs).

-Steve Nye

Interactive Messaging in Times Square, New York

Ever wonder what "Interactive Messaging" is? Well, it can mean a lot of different things depending on the context. This post focuses on Interactive Messaging in the context of digital out-of-home or digital signage, using the work Unwired Appeal did for Sprint's latest advertising campaign as an example.

Why Did the Pedestrian Cross the Road?

In Times Square there are more pedestrians than cars, and although the city is taking measures to make life easier for walkers, it sometimes takes skill and dexterity just to cross the street.

Sprint capitalized on this trend by creating an interactive game on the Reuters Billboard in Times Square. The game was a two player throwback to Frogger. Participants used their mobile phone to control the character on the billboard as he tried to cross the crosswalk. Two players played at a time, and the first to cross to the other sidewalk won. The joystick was used to move the character left and right in order to avoid oncoming walkers.

After the game, participants were sent a text message thanking them as follows: "Thanks for taking on the streets of NYC with Sprint. The Now Network. To see more Now, go to http://sprint.com/nownetwork"

Why Interactive Messaging?

In Sprint's case, making an advertisement interactive served several functions:

1) Deeper "impressions" for those who play the game. Those who stop and engage a game are far more likely to remember the "Now Network" slogan

2) Deeper impressions for those watching the ad: Having live participants in an advertisement ensures unique content each time the ad runs

3) A means to follow up: Sending a text message to game participants means more hits to the "Now Network website".

What were the results?

Thousands of visitors and tourists watched as Sprint showcased one of the more technologically advanced advertising campaigns in New York. Every slot purchased by Sprint was filled to max capacity by players. A total of 595 people signed up to play the game.

King Lear Breaks Out His Mobile

A Text for Tickets Case Study

People's Light & Theatre wanted to reach out to a new demographic -- high school students-- for their production of Shakespeare's "King Lear". They had relationships with area schools and performed special dress rehearsals for several field-tripping schools.

The question People's Light & Theatre asked themselves ( we love it when clients ask the right questions) was "If we offer free tickets, what medium will high school kids gravitate towards in order to reserve and redeem tickets?"

The answer was as obvious to them as it was to Unwired Appeal: Text messaging!

So the directors asked the actors to break character at the end of each dress rehearsal and exhort the crowd:"If you want to come to the real performance? Take out your cell phone and text 'King Lear' to 47647 for free tickets to our next show!"

Out of the 4,200 students who attended the shows, 140 placed orders for a total of 451 tickets. Of those tickets, 263 were redeemed, for a whopping 58% conversion rate.

Those types of conversion numbers are not unheard of in the mobile marketing space, but they are an order of magnitude higher than what "old school" (direct mail, broadcast advertising) marketeers are used to. And they certainly prove a point for the efficacy of marketing through mobile for the youth demographic: If mobile phones can get high school kids to show up for Shakespeare, what can they get your target market to do?

Text Alerts – The Right Stuff

I was packing lunch for my son this morning when I received an unexpected text-message (not many people text me at 8am).

“Your auto policy is scheduled to be cancelled...”. It was from Progressive Direct, my insurance provider.

Hmmm...I thought I paid that. I went online and soon found that I had forgotten to pay the increased premium after adding a new vehicle to the policy. The policy would be canceled in 5 days if payment was not made. With a click of button I took care of it.

Progressive had sent email and letters to remind me, but with the ever increasing volume of both junk email and post, these communications fell through the cracks. But my text-message alert “safety net” saved the day.

I don't want to receive text-message alerts with news, weather, horoscopes, etc.*(see exception below). This information I get through other channels, and those channels are flooded with information every waking hour, so I do want text alerts when something important and time-sensitive requires action.

Instead of using text-messaging for mission critical alerts a lot of companies have resorted to the robo-callers. I get these calls sometimes, but they don't register in the same way. I'm not sure about you, but I only answer calls from unknown phone numbers when I'm in for a little grab-bag distraction. Sometimes these robots leave messages, sometimes they don't. It never seems really important.

For full disclosure, I originally signed up for text alerts from Progressive a few months ago when I wanted to test their system. Unwired Appeal provides the text-messaging infrastructure and database management for their service and I wanted to see how it worked.

This morning I found out.

-Steve Nye

*the one exception is surfing alerts - 365 days a year I want to know when there are triple overheads at Good Harbor Beach - now that's an actionable alert.

Text-Messaging Opt-in/Opt-out Regulations

Recent discussions about e-mail marketing best practices at HBR prompted a discussion here at Unwired Appeal about text-message alert best practices. It was a short discussion seeing as the world of text messaging is a bit more black and white than the world of e-mail. In e-mail, the CAN-SPAM act allows some latitude for ESPs to differentiate themselves by creating their own policies. Some ESPs are very strict, others not. In the text messaging world, service providers aren't given the choice. The regulations are clear. Neglect to follow the rules and you run the risk of having a your network connections severed overnight and possibly being hauled into court (read about several real cases).

Who regulates text message service providers, and why should our customer care? Text-messaging (SMS) service providers are strictly regulated by the wireless carriers. All services must be reviewed and approved by the carriers before launch. When running, the services are continually monitored and audited by each of the wireless carriers for compliance. Our customers care because they know that if they partner with an unscrupulous SMS service provider, they run the risk of having their alerts or marketing campaigns shut down mid-stream.

One of the most important aspects of compliance is following the opt-in/opt-out and database management standards of the carriers. These can be complex as they vary somewhat carrier. Fortunately, the Mobile Marketing Association (MMA) has been working with the carriers to create a uniform set of standards. The latest version can be found at MMA Best Practices.

Following is a overview of the current regulations for Text-Messaging “Alerts”. This only covers “standard rate” services. “Premium rate” services (additional monthly subscription fees charged) use a stricter set of regulations.

Single Opt-in versus Double Opt-in

Single opt-in is now allowed by all carriers when the opt-in is initiated by the end-user sending a text-message to the service (MO opt-in). For example, “Text JOIN to 47647 to sign-up up for JellyBean Alerts”.

You can also ask an end-user to subscribe by entering his/her cell phone number on a website (Web opt-in). But when you use this method, T-Mobile requires that you perform a double opt-in. The second opt-in is in the form of a text-message sent to the subscriber asking for a reply of “YES” to confirm the opt-in. A pin-code verification method is also acceptable.

WAP and IVR opt-in methods are also possible but they are outside the scope of this post (send me an email if you would like an overview of WAP/IVR).

Call-to-action (CTA) and Messaging Requirements (MMA id=CCS-EG-03)

Most audit violations from the carriers are relatively minor and revolve around the wording in the opt-in messaging flow.

Information required in the CTA: program sponsor, description of service, frequency of messaging, how to get help, how to opt-out, “message and data rates may apply”.

Information required in the “welcome message” (sent at opt-in): description of service, frequency of messaging, how to get help, how to opt-out, “message and data rates may apply” (the carriers like repetition).

Opt-out, subscription reminders, and database management

STOP: Subscribers must be able to text the word STOP from their cell phones and be removed from the opt-in list.

Reminders: Individual alerts to users or text MT must include opt-out information (STOP) if a monthly service reminder MT is not supplied separately (T-Mobile TMO-124).

Disconnect lists: Each carrier routinely distributes a list of cell phone numbers that have been disconnected (recycled, ported to another carrier, etc. ). These numbers must be immediately removed from all opt-in lists.

Record keeping: Opt-in and opt-out records should be retained from the time the subscriber opts-in until a minimum of six months after the subscriber has opted-out of the program (minimum opt-in archiving period is one calendar year). These records should be made available to the carrier upon request (CCS-107).

That's it in a nutshell. Keep in mind that these regulations are a work in progress and are modified on a regular basis. For the most current set visit http://mmaglobal.com.

-Steve Nye

P.S. If you are receiving unsolicited messages on your cell phone - here are some tips.

"This is twilio"

Text the word TWILIO to 617-744-9926 and you will receive a simple reply - “This is twilio”. At first glance this is a basic SMS auto-reply service, but underneath it may signal a major shift in SMS service provision in the USA.

People have been talking about twilio's new SMS service over the past month, so I decided I should check it out. Last week we started up a UA account and secured a local twilio number. Out of curiosity we performed a carrier lookup on the number and found that it is registered to Bandwidth.com, a VoIP service provider and national CLEC. Next we used twilio's API to connect the number to our mobile application platform and now we have a full suite of interactive SMS services running over a standard 10-digit phone number (aka long-code).

So why is this important or interesting? Because it gives people the ability to deploy a commercial SMS application or service without having to secure a short code! As I cited in an earlier post on vanity short codes, a dedicated short code costs $500-$1,000 per month just for the lease fee. Add on top of that the aggregator and service provider fees and the costs quickly mount. Not to mention that it takes 8-10 weeks to provision a new short code across the carrier networks.

Before using twilio for SMS services though, people should also take into account a couple of disadvantages compared to short code based services. First, the cost of messaging is most likely higher than when using a short code service (twilio currently charges 3cents per incoming/outgoing text-message). Second, the throughput is throttled to 1 message per second, where on a short code the throughput usually starts at around 5 messages p/s and goes up from there.

Shared short codes provide another alternative, but pricing for keyword routing is not exactly inexpensive, and there is always a possibility that the carriers will shut down a shared short code if one of the services is not in compliance (see recent case with Clickatel)

Will the carriers also try to disconnect twilio's SMS services? I am not an expert on the telecommunications regulations involved here, but I think it might land the carriers in hot water with the FCC if they tried.

-Steve Nye