Crossing Over

After tinkering with MMS for the last two years, wireless operators are finally ready to push interoperability. In the last six months, carriers have been quietly testing inter-carrier messaging and signing interoperability deals. By the end of the summer, interoperability vendors expect all Tier 1 operators to be interconnected and by the end of the year all networks in North America will be interoperable.

The drive toward interoperability was inevitable, but carriers seem more than willing to push it along given the obvious analogue to SMS. In an industry with competing business models, market unknowns and the fickle tastes of millions of subscribers, there are few universals — few blanket statements an observer or even an expert can make that will be taken as a ‘given.’ But one of those givens is that interoperability made SMS. After full interoperability was enabled in 2002, SMS or texting grew from a niche service into a national obsession, especially among the younger generations of wireless users. Carriers not only want to repeat that success with MMS, they want to push it along. So even if camera phones haven't reached the penetration of SMS-capable devices when interoperability was enabled, and standards-based MMS networks haven't been fully implemented, carriers are ready to push interoperability along in the hope of repeating this decade's earlier success story.

To enable interoperability, carriers are turning to the same companies that brought them SMS interop. While MMS interoperability has taken off in other regions of the world, many of those were through direct carrier connections. But now, global SMS interoperability vendors are setting up international and regional inter-carrier MMS hubs, and carriers are lining up to connect to them. In the U.S., the two vendors emerging as the leaders are the same that led in SMS interoperability: Mobile 365 and VeriSign's LightSurf.

“Almost half of every carrier's SMS messaging is interop traffic,” said Neville Street, president and CEO of Mobile 365. “MMS is starting to see the same growth patterns. As we enable interoperability between carriers, we're seeing immediate surges in messaging traffic — even though carriers aren't marketing interoperability yet.”

Mobile 365 — which was created from the merger of InphoMatch and Mobileway — has landed the interconnection deal between the two largest North American carriers, Cingular and Verizon Wireless, as well as a handful of Tier 2 deals, including U.S. Cellular and Leap Wireless. While the carriers are hooked into Mobile 365's hub, they haven't all signed interoperability agreements with one another or with carriers not connected through Mobile 365. But traffic trying to get to other carriers over its hub is also on the increase, Street said, even if it doesn't have anywhere to terminate. Despite the lack of promotion or even awareness about the inner-workings of inter-carrier messaging, just the few interconnectivity agreements in place have already generated a surge of interest in the service, he said.

Figures from the consultancy M:Metrics back up Street's claims. In April, M:Metrics tracked a 10.5% monthly jump in MMS messages sent in the U.S., shortly after Verizon and Cingular enabled interoperability. While M:Metrics can't verify that it was entirely those two carrier's interoperability deal responsible for the surge (the new batch of camera phones landing on the market after the holidays could explain part of the increase), there is definitely something driving overall MMS usage.

“Customers don't care about what network the person they're messaging is on,” said Mark Donovan, senior analyst and vice president of M:Metrics. “Fax machines and e-mail both had to be interoperable before they became widespread. The same has to happen for MMS. It has to get to the point where it just simply works.”

Despite all of the parallels drawn between SMS and MMS, MMS is a much different animal from its predecessor. Delivering a payload of only 100 characters, SMS is fairly limited in its scope — transferring a text message between networks and between disparate handsets aren't difficult matters. MMS, on the other hand, carries a payload that even its simplest form, the photograph, requires a great deal of manipulation to deliver properly. Transcoding must be done to render images properly from handset to handset, and despite standards set by groups like the 3GPP, there are still distinct differences between various vendors' MMS centers, or MMSCs.

“MMS is really a 3G technology that runs on 2.5G,” Mobile 365's Street said. “As MMS develops we'll be seeing a lot more than just photos. That's additional complexity, and we think we're in a great position to manage that complexity.”

It's here that a good deal of the value proposition of the hub provider comes. Carriers, particularly the Tier 1 operators, all have the resources and the ability to interconnect with one another individually, allowing them to divide their revenues among each other and not with their hub provider, but a direct interconnection means much more than just routing all outbound traffic to a gateway, said Jim Straight, vice president of multimedia and data services for Verizon Wireless.

“If I go out and do interconnectivity with every partner, I have to deal with all the differences in service and the differences in standards,” Straight said. “By connecting to the hub, I'm applying one set of standards. As long as I can interoperate with the hub I can interoperate with all of my partners.”

The interoperability problem is exacerbated when you consider MMS was designed to carry much more than pictures; any kind of multimedia or application is a potential payload for MMS and negotiating the capabilities of the networks and the individual capabilities of hundreds of different handsets becomes even more daunting. Here, issues of transcoding become key. While transcoding software might resize a picture for the size of the recipient's screen, it might find itself adjusting streaming speed for slower networks and resolution and even delivery format to meet the requirements of video players in numerous handsets.

Hub providers or MMSCs also would have to determine what types of multimedia a specific device could receive. An MMS containing a ringtone, video and text message might be targeted at handsets with only ringtone and text capabilities. The MMSC would have to pare down the individual elements sent and also send fallback messages with links back to the Internet so recipients can get their un-received content.

The variations will become even more extreme with the advent of IP Multimedia Subsystem (IMS) network architectures. Practically any application can be melded with MMS.

“If you think picture messaging was complex imagine how IMS messaging will be,” Street said. “Messaging will become more real-time and much more interactive.”

It is precisely that complexity that makes MMS vastly different from SMS. According to Mobile 365 competitor VeriSign, a successful SMS interoperability system doesn't mean that success will transfer to an MMS platform. VeriSign, which has announced its own interoperability deals with Sprint, T-Mobile and Dobson Communications, is touting the fact that it not only provides interoperability services, but has also built its own MMSC through its LightSurf subsidiary. While other interoperability vendors are building their hubs based on other vendors' MMSCs, VeriSign's interoperability technology builds on its own platform development and deployments, said Chris Heiser, head of marketing for VeriSign's LightSurf division.

“A lot of people have come to the MMS market from the SMS space,” Heiser said. “There's a saying: Just because Ford builds a great car doesn't mean you hire them to build the Space Shuttle.”

An interoperability provider may not be as critical to inter-carrier MMS as VeriSign and Mobile 365 make it seem. While all of the Tier 1 carriers are signing up with the hub providers, some of the major players may eventually opt to connect directly to each another on a one-on-one basis, said X.J. Wang, senior analyst with the Yankee Group. While the largest carriers still would remain connected to the hubs to route traffic to international carriers, Tier 2 and 3 providers or the odd Tier 1 they don't partner with, most of the MMS traffic in the U.S. will occur between the top five providers. Three or four direct links with competitors would allow it to keep all the revenue from the majority of the messages sent, Wang said. Carriers might be willing to deal with standards and transcoding issues on an individual basis if traffic is high enough, he said.

“Technically it's not that different to make these networks interoperable,” Wang said. “The [interoperability providers] can make things easier, yes, but they also take your revenues.”

The real appeal of the hubs will probably be to the Tier 2 providers who don't have the resources to connect directly to each other or the Tier 1 operators. Nor do they have the clout with the vendors to insure smooth interoperability between MMSCs, Wang said.

Sizing up interoperability's impact on the MMS market is a difficult thing to do; parallels with the SMS market only go so far. While everyone agrees that inter-carrier messaging will produce a significant increase in messages sent, no one knows how much. For one thing MMS isn't just mobile-to-mobile technology. There are numerous other possible destinations for a picture message, such as an e-mail address, an online photo album or a Blog. While an estimated 55% of all SMS traffic is inter-carrier traffic, there's no way of telling if 55% of MMS traffic will even be targeted at another mobile phone, much less a phone on another carrier's network.

Currently, the number of MMS messages sent to phones versus those sent to an e-mail address are roughly even, said M:Metrics' Donovan. As interoperability gears up, phone-targeted MMS will probably increase, but there are limits to just how much it can increase. For one thing, there are still a limited amount of MMS-capable phones on the market today. Donovan said that there are 68.3 million phones capable of receiving an MMS in consumers' hands today, and only 32.9 million camera phones.

But Verizon's Straight said no one is expecting interoperability to result in a massive surge in MMS traffic overnight. Interoperability is just one of the building blocks to making the service a mass market application, albeit an important one, he said.

“Interoperability is a way to get natural growth in MMS,” Straight said. “Without interoperability you're simply blocking that natural growth.”

TRACKING MMS

M:Metrics surveys thousands of mobile subscribers about their usage habits monthly. Its April survey found that an estimated 15.1% took at least one photo with their handset that month, and half sent the photo to another user's phone.

Wireless users taking photos with their phones		Projected subscribers	% U.S subscribers
	Almost every day	5.3M	2.9
	At least once a week	9M	5.0
	Once to three times throughout the month	13M	7.2
	Ever in month	27.3M	15.1
Wireless users engaging in mobile-to-mobile MMS
	Almost every day	1.6M	0.9
	At least once a week	3.5M	2.0
	Once to three times throughout the month	8.4M	4.7
	Ever in month	13.6M	7.5
Source: M:Metrics