Opinion: Verizon and Naral

As originally reported by the New York Times and discussed by the San Jose Mercury News, Verizon first rejected and then later - after public outrage - reversed course and approved an SMS campaign created by abortion rights group Naral. See this interesting article by Timothy Karr for a round-up of opinions and reactions.

Despite what was reported by many news outlets and blogs, this is not an isolated incident, and it is most definitely not limited to Verizon Wireless who was unfortunate enough to get caught in the middle of the controversy.

As readers of this blog know, carriers grant short codes - short 5/6-digit phone numbers used to communicate with mobile users - completely at will. Without a short code a content provider has no way to establish a text messaging based interactive conversation with a consumer. Therefore, each content provider who wishes to create a mobile campaign is forced to go through a laborious approval process with each one of the top carriers without guarantee that all or any of them will approve the campaign. This process can take up to 6 weeks and is quite costly because monthly short code rental fees of up to $1,000 per month are required even though there is no guarantee that the short code will ever be used.

It's as if a website had to pay $1,000 per month to register a domain name, and then were forced to go obtain approval from every single ISP in the country before that domain name were made available to the ISP's customers. Imagine what that would do to innovation on the Internet.

Even worse than that, every wireless carrier has its own 'playbook' of rules and regulations that content providers need to adhere to in order to get their campaign approved. Needless to say, playbooks vary by carrier, and content providers are often forced to implement sophisticated business logic within their applications to deal with carrier idiosyncrasies. And playbooks are not static. They change. And they change frequently, resulting in content providers having to make constant changes to their application in order to keep up with carrier mandated changes.

We believe that this approach is fundamentally wrong for multiple reasons:

1. Wireless carriers should not be in the business of deciding what type of content their customers have access to. They're not monitoring mobile phone calls to screen out offensive content, or limiting calls to certain 'approved' phone numbers. They should not be limiting valid SMS conversations either. At the same time, they should also not be legally responsible for any content that flows through their network.

2. Carrier specific playbooks should be replaced by 'best practices' rules that govern all SMS based communication. The MMA is already publishing a best practices guide that is used by the carriers as a basis for approval. The problem is that many of them 'complement' the MMA guide with their own 40-60 page playbook.

3. At the same time, we feel that carriers ought to be free to design their own guidelines as it pertains to premium SMS billing. It is only fair that they can decide under which conditions they will allow content providers to bill consumers on the cell phone bill. It would be nice, though, if the revenue share percentages were increased to levels seen in Europe and Asia.

Many players in the mobile ecosystem are complaining bitterly about the difficulty and cost of launching off-deck mobile services. Many mobile campaigns fail. And failure is costly. We feel that it would be in everyone's interest - also the carrier's interest - to stimulate innovation by significantly lowering the barriers to entry, and we suggest 4 concrete steps to achieve this:

1. Short Codes for non-premium SMS campaigns are AUTOMATICALLY approved by all carriers upon granting of the number, and provisioned within 7 days. No carrier-specific campaign forms or approvals are required.

2. The MMA guidelines are the sole and only guidelines that content providers need to adhere to for all non-premium campaigns.

3. To further reduce the cost of short codes, codes can be shared amongst various content providers based on keyword.

4. Carriers can continue to keep full control over all short code approvals that involve premium billing.

We feel that this would be a huge step forward for the industry. It would foster innovation by decreasing the barriers to entry and allow for critical experimentation to find out what works best. It would be our best chance for finally realizing the full potential of text messaging as a way for brands to enter into a meaningful direct conversation with consumers.