Acision Fights Creative Destruction with Innovation

Publisher's Outlook

Acision Fights Creative Destruction with Innovation

By Rich Tehrani, Group Editor-in-Chief, TMC  |  May 07, 2015

Mark Zuckerberg gave a keynote speech for the second year in a row at Mobile World Congress (News - Alert), and to me it really seemed like keeping your friends close and your enemies closer. After all, WhatsApp andFacebook are responsible for billions of lost dollars in messaging revenue for global wireless carriers.

I couldn’t help but think of this as I met with Acision. Some years back I was at the company’s corporate offices in Texas where I was told the threat from advertising-based tech models to SMS was unsustainable. Basically the argument was that a carrier wouldn’t be able to replace the subscription revenue with ads, as the advertising market wasn’t big enough to replace the dollars that came in from sending texts. This was before app stores – there was no iMessage, WhatsApp, etc.

At the time, they had a point.

The app store indeed changed everything, and this company – relying on SMS store and forward server, and multimedia messaging store and forward server sales – was facing a situation where its customers were seeing the revenue to fund these purchases eroding. In response, the company replaced its management team and came up with a dynamic plan to capitalize on its strengths and enter new markets to ensure it could respond intelligently to the creative destruction brought on by Silicon Valley.

By integrating flexibility to the SMSCs the company produces, carriers can now add on modules to their message controllers or MCOs. These modules can help carriers reduce revenue leakage through things like grey root detection, which is lost revenue from intercarrier agreements designed to undercut direct carrier billing relationships. Acision (News - Alert) also has spam and fraud fighting solutions, which are selling well. Moreover it is helping carriers migrate to an IP world via SMS over IP-based SMSCs.

Another area of growth for the company is consumer services. In one case in Mexico, 8.5 billion messages per month were stuck in the system due to lack of credit. By allowing a carrier to turn on collect SMS, the acceptance rate can be between 32 and 40 percent – in one case even resulting in a quarter of a billion dollars in found revenue. 

Acision also facilitates SMS gifting as well as SMS-based loans for its carrier customers.

Value-added services are a great way to keep carriers sticky while generating more revenue. Carriers can turn on white and black lists and allow the auto forwarding of messages. Another service, which is in trials, is the blocking of data to phones when a user is driving. Only when the car is stopped and not at a traffic light does the system release the messages. I am told there is currently a joint pilot of this program running between the second largest carrier in the U.S. and an insurance company.

If you have been following TMC’s (News - AlertWebRTC Expo or WebRTC World products, you know Acision has become a big player in WebRTC as well. This is part of the company’s Rich Enterprise Services initiative. This initiative also includes the ability to send premium message, secure encrypted texts that ensure the contents aren’t tampered with or monitored.

The company’s purchase of Crocodile is how it got into WebRTC in fact, and now the company holds hackathons. The most recent winner was an app called Yoroshiku which is what J.F. Sullivan, Acision’s CMO and executive vice president of products, refers to as Tinder meets Rosetta Stone – a service that allows you to connect visually with other people who speak a language you want to learn.

Finally, Acision’s fuseMe app allows carriers to take on WhatsApp and others through a solution that is part news delivery service and part collaboration and social tool. It allows multiple people to be on a video call (I am told if you do it over Wi-Fi, fourteen is as many as participants as you’ll want to connect with to keep the quality acceptable).

Operators for their part can get involved with the app/service in exchange for a revenue share agreement on things like in-app and in-game purchases. Enterprise customers have jumped on the fuseMe app bandwagon as well, using it for things like video banking between tellers and customers. I am told it is infinitely flexible.

In short, creative destruction of markets has turned Acision into an innovation machine of sorts, evolving in its core markets, and expanding into rapidly growing ones where it can use the technology as a Trojan horse to sell more services.

Edited by Dominick Sorrentino