Wednesday, March 31, 2010

"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

9 comments:

  1. Hey Steve, I just wanted to drop you a note to let you know that we recently reduced the price of Twilio SMS to $0.01 per message, and we've also just released a short code SMS product of our own:
    http://www.twilio.com/api/sms/short-codes

    Would love to hear what you think!

    -Danielle @ Twilio

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