The Prices for Bulk SMS Messaging are Tied to the Prices of Operators

Following MTS and Megafon, Vimpelcom has switched to an account-based model of interacting with bulk SMS messaging clients.

This approach results in the increased cost of such mass messaging – 1.5–3.5 times climb in the last six months – jeopardizing the business of corresponding aggregators.

Starting from May 1, Vimpelcom (Beeline trademark) switches to an account-based tariffication of corporate SMS-messaging, as the operator’s representative Yevgeniya Chistova told CNews. Now every end client of bulk SMS messaging will receive an individual bill. The clients will connect to the mobile operators not directly but through special aggregators. In this way the clients’ bulk SMS can reach all subscribers of all operators. Earlier the operator used to bill the aggregator which received a discount for a great amount of bulk SMS pooled from all its clients. Accordingly, the aggregator could rank its own tariffs for the end client.

The amendments to the Law “On Communication” took effect last autumn. They were designed to counteract SMS-spam. Among the rest, the operators were obliged to switch to direct agreements with the end clients of bulk SMS messaging. At the end of last year, MTS and Megafon already switched to direct contracts and introduced an account-based tariffication. As a result, today the entire “Troyka” of mobile operators works with bulk SMS clients based on one-client-one-bill principle. Bulk SMS messaging clients continue to work with aggregators but now they pay at the operator-set tariffs which in fact were increased.

According to the data of the SMS-messaging operator Devino Telecom, whereas last autumn the tariff for mass messaging to Vimpelcom phone numbers was 0.41-0.46 ruble per message (depending on their overall amount), now it has reached 0.6-1.2 ruble. Sending 1 SMS to MTS phone numbers used to cost 0.25-0.30 ruble, now — 0.45-1 ruble. Sending 1 message to Megafon phone numbers used to cost 0.30-0.39 ruble, now – 0.6-1 ruble.

The fourth largest Russian cellular communication operator — Tele2 — never switched to an account-based tariffication. Yet the cost of bulk messaging to its subscribers has grown as well from 0.24-0.30 ruble per message last autumn to 0.55-1 ruble today. This means that the four federal operators have marked up their tariffs 1.5-3.5 times.

In addition it has become harder for bulk SMS messaging aggregators to build their business. Whereas earlier an aggregator profited on the difference between the operator’s tariff and its own tariffs for end clients, now setting the tariffs below the operator’s is ineffective and above – dangerous because of the risk of the client’s shifting to the competition. In these circumstances bona fide aggregators increasingly have to focus on additional services.

For instance, Devino Telecom now cashes on technical support, marketing, delivery notification service, consultancy related to correct making of SMS-requests including compliance with the Laws “On Advertising” and “On Communication” etc.

Nevertheless all market players note that legislative changes coupled with the measures undertaken by the operators helped to make a remarkable dent in the amount of SMS-spam. MTS, for example, point out that since last November the average daily amount of spam-messages has shrunk 1.9 times and the average number of subscribers’ complaints on spam has fallen 1.5 times vs. similar indicator over the last 9 months.