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Commentary

Thinking Aloud: SMS Spam

Reading about Spam SMSes I’ve realized that the reason spam is prevalent is that costs are low. [Warning: Long, rambling post]

From LiveMint:

Today, Singh sends close to 20 million SMSes per month, roughly half of them on behalf of real estate developers, who have become the most prolific and annoying spammers in this particular medium. It takes Singh just a minute to send 100,000 SMSes, for which he charges Rs4,000; for one million SMSes, the rate drops to 3 paise per message. “If you call 100,000 people, even at 30 paise per call, imagine how much more expensive it would be,” Singh points out.

This is incredibly cheap, and I like that. I remember the days when you couldn’t go under a rupee per SMS. It’s very useful for business, to send quick and non intrusive status updates. The email of the mobile phone, so to speak. But is it?

More business users are likely to use email anyways because 140 characters with no images doesn’t cut it, there is no way to properly “reply all” or even archive/search messages etc. But Email has a much slower delivery than SMS. In general, you would expect email to take longer than an SMS to arrive, plus people get obscene amounts of email and don’t bother opening them all. SMS’s non-archival is also very good in the Indian context where shady deals are being done, and people don’t want to discuss it over official email.

The economics works at the 4p or 3p per SMS at a small scale and 1p/2p at a large scale. And this is helpful. I get an update every time I do a transaction on my credit card, or do an online transaction from the bank account. I get SMSes from my broker for each transaction, plus an end of day summary of each market I trade. I get SMSes from NSDL if my shares are moved in or out. This would not be possible if SMSes weren’t cheap.

And SMSes are cheap because of the heavy amount of marketing on it. Which as we all know is a pain in the wrong place. I suffer email spam and instead of bothering to send legal notices  I simply delete the message. Or, I report as spam to my email provider, Google – which gets smarter and doesn’t allow such messages in again. No such luck with SMS. Additionally, when I’m out of town, I pay to receive such SMSes inspite of my not-wanting to!

We will probably benefit from something of that sort on the mobile. An app that sits in, uses (perhaps) J2ME so it can run on most mobiles, hooks in to the messaging API and automatically records as spam any message that says “TM-“ etc. which isn’t a known non-spam entity. I wonder if such apps exist.

Back to the SMS spam. The figures are immense:

The largest sender of such SMSes is ValueFirst Messaging Pvt. Ltd, and its chief executive officer Vishwadeep Bajaj estimates that 150 million marketing messages—of both spam and non-spam variety—are sent every day in India; his firm sends a full one-third of these. On a half-wiped whiteboard at his office in Gurgaon, Bajaj chews through the numbers; assuming each message costs, on an average, 3 paise, that would bring the industry’s annual revenue to Rs200 crore.

The article says the mobile operators charge a paisa per SMS, which means 40 cr. in net revenue. They plan to go public, as does One97, another such mobile messaging and VAS intermediary.

What happens now? Do people get sick enough of spam that TRAI announces blanket bans on marketing SMSes? Will that hurt these mobile businesses a lot? Time will tell; but the real story in SMS will be how it can be used for our benefit at this low cost, not to spam us.

  • Anonymous says:

    >i found an interesting article online .. It proves that the cost of sms to telcos is actually zero.

    http://www.wired.com/gadgetlab/2008/12/text-messages-c/

  • Anonymous says:

    >>An app that sits in, uses (perhaps) J2ME so it >
    >can run on most mobiles, hooks in to the
    >messaging API and automatically records as spam
    >any message

    Or an app. that allows a whitelist i.e. a list of numbers from which SMS's or phone calls are to be accepted. This should be so easy to do, I'm surprised mobile phone manufacturers or phone service providers don't offer it as a default. Perhaps they are hand in glove with the SPAMmers.

  • sjdate says:

    >If E mail service providers can identify spam and filter it why can't Mobile service providers do it ? I feel so helpless. In spite of my registering for DND, I have recently been flooded with Marketing SMS's on varoius subjects like stock-purchase-advise to buying land in Rajasthan.
    TRAI needs to do something about it.