Market Insight

Spanish operators launch inter-operable rich communications solutions (RCS)

December 05, 2012

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Telefonica's Movistar, France Telecom's Orange and Vodafone launched Spain's first fully interoperable rich communications services (RCS) service through Joyn. The application offers instant messaging, file transfer and video sharing. All the services are available while simultaneously talking on the phone. Unlike other instant messaging clients, Joyn requires no registration, and will come preinstalled on certified devices in the future.

Joyn is also available in the US through Metro PCS, as well as T-Mobile and Vodafone in Germany, but are limited to their respective networks. Other instant messaging clients such as WhatsApp have also signed agreements with operators such as Reliance Communications in India and with handset manufacturer Nokia.

The service is available through Google Play for Android devices with an iOS version expected soon. Pricing has not yet been announced.

Over the past five years, the messaging revenues and volumes of the three largest Spanish operators have been slowly eroding. OTT players such as WhatsApp, Viber have been a growing alternative to the traditional text message. In August 2012, WhatsApp surpassed 10 billion daily messages globally. Operators have been launching partnerships with various IM clients. Partners have included Windows Live Messenger, WhatsApp, Skype, Joyn and others. Like operators, handset manufacturers have seen this as an opportunity to tie consumers into their brand. Samsung launched [email protected] and pre-installs it on its smartphones; Apple launched its iMessage service with iOS 5 in 2011; while RIM's Blackberry Messenger still maintains 60 million users.

Operator-driven instant messaging clients are nothing new. T-Mobile, Telefonica and Orange have previously launched in-house build services. In 2011, T-Mobile launched Bobsled globally and a year later and Orange launched Libon in 31 countries, not including Spain. Telefonica also launched its own global instant messaging service, TU Me in 2012. The launch of Joyn so soon after this indicates the high value of interoperability in messaging.

The additional multimedia functionality, group chat, and virtually unlimited global messaging for a flat, monthly internet fee have been key factors for the success of instant messaging services over more traditional MMS and SMS services. Operators globally have seen messaging revenues affected by third party services, and are generally apprehensive about the rise of VoIP services.

The interoperability of Joyn in Spain is the most important factor that could help lead to general consumer adoption, unlike iMessage or BBM which are limited to certain platforms. WhatsApp and Facebook Messenger are also platform agnostic, and represent the most direct competition for users to Joyn. Unfortunately for Joyn, Facebook's and WhatsApp's vast user bases give them a significant head start in the evolving market, however operators still hold on to their position of power by integrating Joyn into an SMS app, which will help the transition from traditional SMS to RCS.

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