global a2p messaging forecasts 2015-2020

The latest Databook from mobilesquared@mobilesquared

Global A2P messaging forecasts 2015-2020Mobile operators key to unlocking multi-billion dollar SMS ecosystem

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The mobilesquared Databooks feature:

• Summary market overview

• Current market data +

• 5-year forecast market data 2015-2020 covering the top 200 countries

• Key trend analysis

• Key findings covering the main areas your business needs to plan for.


The mobile operator view of the A2P messaging opportunity

All data included in this presentation is from Global A2P messaging forecasts 2015-2020 DatabookPublished 6th July 2016

The mobile operator view


*Based on mobilesquared research 3Q 2014

18.4%

8.2%

6.1%

12.2%

4.1%

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

0-5% 6-10% 11-15% 16-20% 21% +

By what percentage has your A2P messaging traffic changed in the last 12 months?*

49% of mobile operators believed their A2P traffic had

increased over the last 12 months

6% of mobile operators believed A2P messaging had

reduced over the last 12 months, leaving 44.9% to

answer “Don’t know”

The above pie chart implies around 60% of mobile

operators believe they are monetising A2P traffic!

16.7%

13.0%

5.6%

9.3%3.7%

0.0%

11.1%

40.7%

Over the last 12 months, what percentage of your messaging traffic was A2P?*

0-5% 6-10% 11-15% 16-20%

21-30% 31-40% More than 41% Don’t know

The mobile operator view II


**Based on mobilesquared research 3Q 2015

A2P messaging via operator-owned OTT apps seen as most important monetisation strategy by

mobile operators in 2016.

A2P messaging viewed as only the 4th most important monetisation strategy – behind IoT, M2M, and OTT app.

0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50 4.00 4.50

Domestic and international A2P SMS

Internet of Things & M2M

Portability and phone verification information (e.g. phone status,location, etc.)

A2P messaging via operator-owned OTT apps

Which monetization strategies do you think would be relevant for you in the next 12 months (1 not relevant, 5 highly relevant)?**

Slow to adopt A2P opportunity


Based on mobilesquared research 2Q 2015-1Q 2016

Reasons mobile operators have been slow to identify the A2P messaging opportunity:

• focused on countermeasures against OTT players: protecting P2P messaging revenues and not driving the A2P messaging opportunity

• unwilling to accept the low A2P messaging rates

• blinded by mutual forgiveness and reliant on mutual balance between inbound and outbound traffic, previously applied to P2P SMS

• Decision-making hampered by messaging teams split across multiple internal divisions, and/or staffing shortages

• Unwilling to invest in messaging infrastructure.

Majority of mobile operators entrenched in SMS revenue protection mode, yet to transition to A2P growth mode.

Mobile operator A2P commitments


Based on mobilesquared research 2Q 2015-1Q 2016

A grey area

is the number of mobile operators the A2P industry believes have invested in an SMS revenue assurance platform25%-33%

3%-10%is the number of mobile operators the A2P industry believes have actually locked down their network and truly capitalising on A2P messaging opportunity

Mobilesquared forecasts the number of mobile operators that will invest in a 2012+ SMS revenue assurance platform

between 2015 and 2020 will increase by 250%.


Global A2P messaging forecasts overview, 2015-2020

Total A2P revenues, global ($)


-

10

20

30

40

50

60

70

2015 2016 2017 2018 2019 2020

Bill

ion

s

Africa Asia Caribbean East Europe Latin America

Middle East North America Oceania West Europe

Global A2P messaging market

worth $17.2 billion in 2016,

rising to $58.7 billion in 2020.

A CAGR of 36%.

Asia will account for 49% of the revenues in 2016, falling to

43% by 2020.

Total A2P messages, global


Total global A2P messages sent in

2016 will be 1.6 trillion, rising to

3.4 trillion in 2020.

A CAGR of 21%.

Asia will account for 68% of

traffic in 2016, falling to 64% by 2020.

North America will account for

15% of traffic in 2016, increasing

to 17% in 2020.

-

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

2015 2016 2017 2018 2019 2020

Bill

ion

s



A2P messages per subscription


188.46

2016

Annual

15.70Monthly

0.52Daily

375.75

31.31

1.03

2020

By 2020, on average, every mobile

subscription in the world will be receiving 1 A2P message per day.

Top 10 A2P countries 2016, by traffic

1. China2. India3. USA4. Indonesia5. Brazil6. Russia7. Bangladesh8. Thailand9. Philippines10. UK

Grey vs white route traffic


-

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

2015 2016 2017 2018 2019 2020

Bill

ion

s

White traffic Grey traffic

Top 10 grey markets 2016, by traffic

1. China

2. India

3. USA

4. Indonesia

5. Brazil

6. Russia

7. Bangladesh

8. Pakistan

9. Thailand

10. Philippines

65%

56%

46%

37%

28%

19%

Total grey traffic, global


-

100

200

300

400

500

600

700

800

900

1,000

2015 2016 2017 2018 2019 2020

Bill

ion

s



Total grey route traffic will fall 8% during forecast period from

897.4 billion to 649 billion.

Developed messaging markets will

see a decline in grey route traffic during forecast period.

Emerging mobile markets will

experience increase in grey route traffic during the forecast

period.

Total white traffic, global


-

500

1,000

1,500

2,000

2,500

3,000

2015 2016 2017 2018 2019 2020

Bill

ion

s



White route traffic will account

for 44% of total A2P messages

by the end of 2016, and 81% by

2020, due to an acceleration of investment by mobile operators.

White route traffic will increase

from 707 billion in 2016 to 2.7trillion in 2020.

Total grey revenues, global ($)


0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

2015 2016 2017 2018 2019 2020

Bill

ion

s



Grey route traffic will generate

$3.3 billion in 2016, falling

to $2.4 billion by 2020.

A CAGR of -7%.


grey route traffic revenues in

2020, Latin America 15% and

Africa 10%.

Total white revenues, global ($)


-

10

20

30

40

50

60

2015 2016 2017 2018 2019 2020

Bill

ion

s



White route traffic will generate

$13.9 billion in 2016,

jumping to $56.3 billion by

2020. A CAGR of 42%.


white route traffic revenues in

2020, North America 23% and

West Europe 15%.

Grey vs white revenues, global ($)


-

10

20

30

40

50

60

70

2015 2016 2017 2018 2019 2020

Bill

ion

s

Total grey revenues Total white revenues

White route traffic accounts for

81% of total revenues in 2016,

increasing to 96% by 2020.

74%

81%

86%

90%

93%

96%

Lost revenues, global ($)


By applying white route prices to grey route traffic, or if all grey

route traffic was converted into white route traffic, it would

generate an additional $14.6 billion in 2016, falling to $11.4

billion in 2020.

Based on the above principle, between 2015 and 2020 the

revenue leakage attributed to grey route traffic is worth

$82.1 billion. -

2

4

6

8

10

12

14

16

2015 2016 2017 2018 2019 2020

Bill

ion

s

Total market potential, global ($)


If all grey route traffic was converted into white route

traffic, the global A2P messaging marketing would be worth

$31.8 billion in 2016, leaping

to $70.1 billion in 2020.

-

10

20

30

40

50

60

70

80

2015 2016 2017 2018 2019 2020

Bill

ion

s

white revenues Converted grey revenues

What is a databook


The Global A2P messaging forecasts 2015-2020 databook contains comprehensive market data and forecasts covering 200 markets worldwide, coupled with a concise, accessible 60-page report to provide you with all the data and key top-line analysis you need to inform your business decisions.

The Global A2P messaging forecasts 2015-2020 databook includes:• Annual A2P messaging traffic, 2015-2020• Annual A2P grey messaging traffic, 2015-2020• Annual A2P white messaging traffic, 2015-2020• Average A2P traffic per subscription per month, 2015-2020• Average A2P grey traffic per subscription per month, 2015-2020• Average A2P white traffic per subscription per month, 2015-2020• Annual A2P messaging traffic revenues, 2015-2020• Annual A2P grey messaging traffic revenues, 2015-2020• Annual A2P white messaging traffic revenues, 2015-2020• Annual A2P messaging potential revenues, 2015-2020• Annual A2P messaging lost revenues, 2015-2020• Average A2P revenue per subscription per month, 2015-2020• Average A2P grey revenue per subscription per month, 2015-2020• Average A2P white revenue per subscription per month, 2015-2020• Global mobile subscriptions 2015-2020

With our databooks you can now use actual numbers in presentations and reports, and not percentages.

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Published 6th July 2016

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