Archive for December, 2010
Last week we discussed the lengthy process of obtaining a dedicated short code. Provisioning a short code isn’t just a lengthy process; it’s also an expensive one. Leasing a short code has a number of costs. If you want a vanity code – any code that Neustar hasn’t randomly assigned you – it will cost you $1,000/month to simply lease the code. If you go with a random code the cost is $500/month. So, you’re looking at leasing costs of either $6,000/year or $12,000/year. At a minimum you have to pay for three months at a time. If you choose to pay for longer periods of time at once you won’t receive a discount.
You’ll also need to connect to a text messaging gateway, on top of your leasing fee to Neustar. You can work directly with an aggregator or work through a reseller. Either way you’re looking at additional monthly fees and messaging minimums.
Now let’s look at long codes. Costs range from a dollar or two a month to around $50/month, depending on the level of support you’re looking for and whether or not you’re using an API or a point-and-click application. Gateway and aggregation fees don’t exist with long codes. Messaging rates are comparable to short code rates and are often substantially lower. The math is clear; the difference is dramatic. Unless you have the budget and the need for a shorter number long codes are the way to go.
Want to learn more about text message marketing using long codes? Check out Group Texting’s long code service.
Yesterday the FCC finally issued its long awaited ruling on Net Neutrality. Net Neutrality is a fundamental principle that dictates that Internet Service Providers cannot discriminate against different types of applications and content. If you’re unfamiliar with the concept of Net Neutrality and its importance head over to endadget for some background.
What does this have to do with mobile phones? In the last three years, mobile Internet usage has grown dramatically. Twenty-Five percent of Americans own smartphones. That number will grow considerably in the next year. The initial success of the iPad indicates that mobile computing is going to grow in a big way. Americans use their phones to access data services, through tens of thousands of apps and their phones’ browsers. The carriers now have a green light to say, ‘If you want to access this service you’re going to pay us an additional fee to do so.’
Let’s consider some hypotheticals. Are you using the wildly popular Pandora app to stream music to your phone? Your carrier might develop a relationship that allows you to stream music from a preferred partner; if you’d like to use Pandora you could be hit with a per/megabyte fee. Are you streaming Netflix movies to your iPad using that 3G service you’re already paying AT&T or Verizon for? Sorry, streaming a movie really taxes wireless networks so that will cost you an additional fee. Maybe they won’t charge an additional fee; instead they’ll throttle back your speed, which will result in a lower quality stream. Streaming movies and music are good hypotheticals because these do seem like cases where the carriers might have a point. Streaming a movie is taxing. But we cannot allow the carriers to pick and choose what is appropriate and what isn’t appropriate. If you think they aren’t actively considering this very question take a look at this slide prepared by Openet and Allot:
That is the future the FCC’s wireless exemption allows. Quoting from Ars Technica:
Want Facebook? Get ready to pay—or not; as a further slide makes clear, one of the key business models here might be bundling connectivity with the app. In other words, the Facebook app would come with, say, unlimited data use while the YouTube app would not. Wireless carriers could charge Facebook a fee to provide this “free” data use to consumers.
We’ve been talking about content producers and their right to reach consumers without paying off the carriers. We say paying off because the fact is the carriers are already charging their consumers to access that content. The FCC ruling will allow them to grab money with both hands. Don’t pay, you cannot play. Now let’s consider mobile marketers. If the carriers shred the principle of Net Neutrality for content producers there is no doubt they will press mobile marketers.
The carriers already assert that they can pick and choose what marketing campaigns are permitted on their networks. If they don’t approve of your campaign they won’t provision your short code on their network. They’re actively discriminating against text message marketing campaigns. As mobile marketers embrace richer formats like video, promotional applications and Apple’ s iAd the carriers have been given the green light to setup a toll booth.
Yesterday’s ruling did not occur in a vacuum. In August, Verizon and Google proposed that Net Neutrality should not apply to the mobile web. The outcry against this proposal was fierce. Technology journalists criticized it. The Editors of The New York Times opined against it. Mobile marketers accept a very similar reality when it comes to text messaging. Some thought this summer’s backlash would lead the FCC to afford mobile broadband the protections it deserves. Perhaps in doing so the FCC would finally grant text messaging the common carrier non-discrimination protections it deserves. Instead we have yesterday’s FCC ruling. The lobbying of Google and Verizon, among others, has produced a ruling that is as dangerous as the most pessimistic among us had feared. MG Siegler of TechCrunch is all over this. First, an excerpt from the FCC’s statement:
Further, we recognize that there have been meaningful recent moves toward openness, including the introduction of open operating systems like Android. In addition, we anticipate soon seeing the effects on the market of the openness conditions we imposed on mobile providers that operate on upper 700 MHz C-Block spectrum, which includes Verizon Wireless, one of the largest mobile wireless carriers in the U.S.
In light of these considerations, we conclude it is appropriate to take measured steps at this time to protect the openness of the Internet when accessed through mobile broadband.
Now we’ll quote Mr. Siegler who rounds up the reactions from around the web:
While that may read like it’s a statement from Google or Verizon — actually, the entire section reads a lot like their joint proposal — it’s actually the FCC’s statement. Yes, that’s the FCC citing Android’s openness as a reason why they don’t need to impose net neutrality rules for mobile broadband.
Except wait. What the hell does an open operating system have anything to do with network access? Nilay Patel wonders this. John Gruber wonders this. Everyone should wonder this. It really does almost read as if they just copied what Google and Verizon laid out and forgot to remove the self-promotion.
I’ve made my thoughts on Android’s “openness” very clear. So have others. I believe the carriers are taking advantage of it and will continue to do so to the detriment of consumers. Now the FCC is using the “openness” label to screw us on net neutrality? Great.
Why doesn’t the FCC just say something like: “We just attended this great Google conference and heard that Android was open. Therefore, we see no need to regulate mobile broadband. It’s open, you see. That’s good for everyone. That means that everyone is going to do the right thing. An open operating system ensures there won’t be any throttling or filtering. Why? Because. Well. Open! Verizon agrees.”
As mobile marketers and as consumers we all should worry about yesterday’s ruling. Serious headwinds now stand in the way of further mobile innovation. Three years ago few could have imagined the broad array of services that would be available on our mobile phones. Going forward, developers of new services will stop and ask, will the carriers permit this service? Will they throttle it back if it grows popular? Will they require me to pay to reach consumers?
MG Siegler and the other writers quoted are rightfully alarmed. Yesterday’s ruling was the result of intense lobbying and numerous astroturfing campaigns. Search Google for Net Neutrality and you’re likely to see paid advertisements for groups that claim to represent the interests of consumers. Search for ‘net neutrality astroturfing’ and you’ll find links to writers and organizations who have outed ‘consumer advocacy’ groups staffed and funded by the wireless and broadband carriers.
Just this morning we received a heads up about a group called MyWireless.org. They bill themselves as ‘a nonpartisan non-profit advocacy organization, made up of wireless consumers, businesses and community leaders from around the country, supporting reasonable pro-consumer wireless policies.’ It turns out this group shares a Washington DC office address with CTIA, the international trade group of the telecommunication industry. If you’d like to make a press inquiry you can contact Brian Johnston, their Director of Communications & Federal Advocacy. Mr. Johnston also serves as the Director of Communications and Public Affairs for the CTIA.
We checked out their stance on Net Neutrality. That the carriers are astroturfing is a given; if they’re going to do so they should at least hire better writers:
The country’s big Internet giants are once again lobbying the U.S. Congress and the U.S. Federal Communications Commission (FCC) for dangerously misguided regulations that could negatively impact your wireless and Internet services.
These big online companies – and their blogosphere and celebrity supporters – want to stop wireless carriers from managing their wireless networks – especially wireless Internet. This would make the Internet companies lots of money, by shifting costs onto network providers like the wireless carriers. But it could cost consumers even more. That’s not fair, and it’s simply bad policy.
The proposed regulations could seriously degrade the quality of your wireless and Internet service (including the ability to make E9-1-1 emergency calls), opening it up to a host of quality and security problems – unwanted SPAM, viruses, adult content and more. Not to mention that you may end up paying higher bills for worse service!
If the FCC and Congress let flashy online companies and their billionaire founders write regulations that favor their businesses, American wireless and Internet consumers will ultimately lose money, choices, security and quality.
The carriers claim to be acting in the interests of consumers. It would be humorous if it wasn’t so dangerous.
Bars and nightclubs were some of the first businesses to integrate text messaging into their marketing mix. Chances are if you’re in the nightlife industry you’ve already tried text messaging or know some competitors who currently text their patrons. The nature of the nightlife industry is a perfect fit for text message marketing. So how do you get the most out of your 160 characters?
No matter what type of business you’re promoting it’s important to remember two things. First: text message marketing is permission based. Second: you’re throwing away money if you send messages to people who don’t want to hear from you. So what does that mean in practice? There are three ways for your patrons to ‘opt in’ to receive messages from you:
- Text your keyword to our long code. Two things happen when your patrons do this – we add them to your text messaging list and send them an automatic response that you’ve specified. You can try this right now by texting JOES to 760-670-3130.
- Import existing opted-in contacts using our contact uploader. If you’ve been manually collecting phone numbers from your patrons you can upload a spreadsheet or just paste those numbers into our form. We’ll automatically weed out duplicates.
- Entering a phone number into a web widget. Every Group Texting customer can generate custom widgets to add to their website, email blasts and Facebook Page. All a patron (or potential patron!) needs to do is enter their phone number and we’ll automatically add them to your text messaging list.
So how do you get people to join your list? Options two and three should be pretty clear. What about keywords? We recommend advertising your keyword throughout your venue (table tents, signs, a sticker on the front door, etc.). Second, whatever marketing you currently do – from your website to print advertisements – add your keyword. Chances are your patrons have their phone nearby at all times; allow them to opt in to your text messaging list wherever they are.
What should you text to your patrons? This is a question we’re asked all the time at Group Texting. We’re not a marketing agency but we do know what works well for most bars and nightclubs. You have 160 characters. Get the most out of them:
- Make your patrons feel special. How do you do that? Incentivize. Why should someone join your text messaging list? Your goal is to drive more feet through the door. Give people a reason to visit your venue with text coupons for things like drink discounts or line-jumping privileges. Your patrons might not want to slap a coupon down on the bar; let them pull out their phone to show your text message to a server or a bouncer. This applies to your call-to-action wherever you promote your Keyword as well.
- Run your marketing campaigns at the right time. Would you want to receive a text message at 6am? If you won’t have access to a computer when you want your messages to go out we’ve got solutions for that. When you login to grouptexting.com and compose a message you can schedule when we send it to your list. Need to send a last minute message? Our Send-From-Phone feature allows you to send us a text which we’ll send to your contacts.
- Segment your contact lists. Group Texting allows you to create as many groups as you like. Any contact can belong to multiple groups. For example, you could segment your VIPs into their own group. If you have a large staff import their numbers and store them in their own group. If you find yourself short staff you can quickly text your Bartenders group to see if anyone can pick up a shift.
This is just the tip of the iceberg. Just like everything else you do to promote your bar or nightclub your imagination is the limit. Hopefully this post has gotten you thinking about what you can do with text message marketing and how Group Texting allows you to do it. Want to learn more? It’s free to sign up and there are no credit cards or obligations needed to give Group Texting a spin. Check out Group Texting now.
When potential clients inquire about leasing their own short code they’re always surprised to hear how long it will take to get going. Text message marketing is new for most businesses; having decided jump into the pool it’s frustrating to find out that it will be 8 to 12 weeks before they can take the plunge. And then we explain what needs to be done to get that process going.
Text message marketing is a powerful tool in the hands of an intelligent small business owner. The problem is getting to the point where they can actually launch their first campaign. Think about it from a business owner’s perspective: A Neustar lease, program briefs, carrier-by-carrier provisioning, and up-front costs and commitments. The entire ecosystem from the carriers to the aggregators to the Common Short Code Administration (CSCA) makes it difficult for someone to jump right into mobile marketing.
Contrast this with the long code process: Lease a long code and it’s active within 24 hours. That’s it. Want to learn more about text message marketing using long codes? Check out Group Texting’s long code service.
The major wireless carriers came together in 2003 to create short codes to allow marketers to easily communicate with consumers. Since then text messaging has exploded in popularity. Short codes haven’t seen growth to match. Why? A long, opaque and expensive setup process prevents all but the largest brands from marketing to their customers with text messages. Enter the long code: instant setup, affordable transparent pricing, and no one standing between your company and your customers. Short codes were supposed to bring mobile marketing to the masses. Long codes, virtual mobile phone numbers that can send and receive text messages stand ready to finally fulfill that promise.
Long codes? Virtual mobile numbers? Let’s cut through the jargon and get to the facts. Long codes are plain old ten digit phone numbers. Once a long code is active and connected to a text messaging gateway it can be used to send and receive messages anywhere in the world. Short codes need to be approved and provisioned carrier network by carrier network – and there are many regional/pre-paid carriers who still do not support short codes. Are your customers using Google Voice or other popular VOIP providers? They cannot reach your short code and you cannot send text messages to them. Because long codes are regular phone numbers long codes just work.
Short Codes Are Vulnerable
The carriers’ short code platforms are notoriously unstable, going up and down, or delivering messages with multi-hour delays with troubling regularity. As long as the mobile networks themselves are up and running long codes will work. Further, the aggregators standing between the carriers and your SMS gateway provider are more than middlemen – they are another cog that can break down. If you’re providing emergency messaging services via short codes you’re relying on two critical chokepoints.
With short codes you live and die by the whims of the carriers. A quick search turns up cases of carriers blocking a number of prominent political text messaging campaigns. The laws are out of date and the FCC has been slow to act. The result? The expensive short code campaign that you spent three months to get going can be shut down on any carrier’s network at any time. Constantly changing ‘rules,’ ‘guidelines,’ and ‘best practices,’ while well intentioned, are often enforced arbitrarily.
So what do long codes bring to the table?
- Instant setup: Get going in less than 24 hours instead of 8 to 12 weeks.
- Cut out the middlemen and save money: No aggregator fees and contracts, and no passed along short code leasing costs mean your campaign can be run at a fraction of the price of a short code campaign.
- The widest coverage: If a customer can send and receive text messages you can reach them with a long code.
- The fastest messaging throughput available. Send 5 messages/second with a single long code. Pool multiple long codes for unlimited throughput.
Where We Stand Today
If you want to use a long code for your text message marketing campaigns you don’t have nearly as many service providers to choose from as you do if you go the short code route. We expect this to change in the near future. For now there are two ways to go about getting a long code. If you’re looking for a point-and-click platform, Group Texting offers a simple, affordable solution that is very similar to what you would expect on a leading short code platform. If you’re a developer looking to use your long code via API, companies like Twilio and Tropo are ideal solutions.
Short Codes aren’t without merit, and long codes aren’t a panacea to all of the problems affecting short codes. It’s undeniable that short codes are easy to remember for consumers. A long code is a ten digit phone number. Phone numbers can be memorable but nothing beats a good five digit short code. Consumers have also grown accustomed to short codes, voting for American Idol candidates, taking polls at stadiums, and responding to ads on the street. Short codes were designed as an ideal marketing platform, and in this regard they excel.
Short codes showed great promise. Just like a domain name, a company would register a short, easy to remember code and text with their customers. In the end it hasn’t worked out that way. The analogy to domain names is instructive. Until 1999, Network Solutions was the only place to buy a now ubiquitous dot.com domain name; it took public outcry over monopolistic pricing to get us the cheap domains from multiple registrars we now take for granted. So when it comes to short codes why does a single company, Neustar, have complete control over the leasing of short codes? And why does a short code cost $500 to $1000 per month when a long code costs $1/month? With a limited pool of short codes a lease of $1/month isn’t feasible; $500 to $1000/month is simply unreasonable.
Leasing a short code from Neustar doesn’t even guarantee that the various carriers will actually provision the short code on their network. Imagine a world where you purchased a domain name – a randomly assigned one at a cost of $6000/year or one of your choice at a cost of $12,000/year – and then had to ask all of the major ISPs to allow their customers to access your services at that domain name. This is where we are in the world of short codes at the end of 2010.
What About Premium Services
Premium campaigns are another example of short codes failing to live up to their potential. Premium short codes were designed to make it easy for consumers to purchase mobile content, and later to make mobile donations. They text a premium code, they confirm, and payments are automatically charged to their mobile phone bill. There are three problems with the actual implementation. First, the carriers typically keep 50% of the gross revenues. Compare that to the 30% cut in the major App Stores – platforms which are far more costly to maintain. Second, there is a 90-day delay on the payments your customers have made. And lastly there is the opaque approval process. The carriers claim they’re looking out for their customers but this argument is disingenuous. After turning a blind eye to unscrupulous ringtone vendors for many years the carriers had to spend millions of dollars settling class action lawsuits. Following these lawsuits the carriers overreacted by tightening the approval process for premium short codes to the point that legitimate businesses regularly see their applications denied.
Ironically, in the half decade since the ringtone debacles, the carriers created a way to cut them entirely out of the equation. The rise of the mobile web, smartphones, and mobile payment solutions from PayPal and others presents an increasingly viable alternative to premium short codes. Couple mobile payment services with long codes for the initiation and delivery of content via links to mobile websites and you no longer need to deal with the carriers’ arbitrary guidelines and excessive revenue splits.
This isn’t a far-fetched solution that should arrive in a couple of years; it’s already happening. PayPal is on track to process $700 million dollars of mobile payments this year. In October they rolled out a ‘two click’ mobile payment solution. In 2011 they’ll begin to process credit card transactions for non-members via mobile. And PayPal is just one player in the rapidly growing mobile payments industry.
A Realistic Take
Do you need to get going tomorrow, not twelve weeks from now? Do you have the patience to work through program briefs, reams of carrier regulations, and constantly changing MMA guidelines? Do you have $12,000 to spend over the next year? These are deal breakers for 99% of the businesses in America. The long code, a solution that has been with us since the beginning, is poised to kill the short code.
Group Texting is here to bring long codes to the world of text message marketing. A few definitions are in order:
Long codes, also known as long numbers and DIDs are virtual mobile phone numbers. Long codes can send and receive text messages just like any other mobile phone number. In order to send and receive text messages using your long code you need to use a gateway service like Group Texting. Our web app (hint: it’s free to give it a spin) allows you to easily and affordably send text messages to 10 people or 10,000 people in seconds. That brings us to text message marketing.
Text Message Marketing
Text message marketing (a $3.2 billion dollar a year industry!) is exactly what is sounds like – marketing to your customers using text messages. Want to learn more about text message marketing? Take the Group Texting tour.
A Bit More About Group Texting
Creating a group texting account is absolutely free – and we’ll throw in some credits and a free Keyword so you can send and receive some test messages. When you’re ready to start your first text message marketing campaign you can pay two ways. You can purchase message credits on a pay as you go basis or you can sign up for one of our monthly plans. Want to learn more? See our plans and pricing page for all the details.