A presentation given by HAUD Systems at the Asia Pacific Fraud Forum in Beijing in October 2013. Provides some insight in the extent to SMS fraud and some ways to combat this type of fraud.
1. HAUD Systems 5 Ways to Win over SMS Fraud
2. About HAUD SystemsBased in Malta (Europe) with branches in UK, Sweden and Singapore.Developing proprietary filtering solutions and secure connectivity pathways for MNOs and SCCP carriers. Started in 2011 by bringing together people from the aggregator world and the telco environment. Developed its first prototype by May 2011 and obtained its first customer by the end of that year. Constantly seeking new ways of combatting technical fraud through its latest solutions. Currently partnering with a number of integrators and SCCP Carriers as well as groups of operators to roll-out the solutions in various parts of the globe. 3. Setting the Scene Application-to-person (A2P) SMS messaging will be worth $70.1 billion by 2016,according to a white paper from Juniper Research, May 2011.P2P likely to flatten out in view of OTT messaging services and further smartphone penetration what about A2P?9.8 trillion text messages were sent in 2012 - Pew Research>40 sizeable aggregators in Bulk/A2P messaging and growing.> 95% of text messages received are open and read within minutesThe United Kingdom Application-to-Person (A2P) SMS market is estimated to grow from 23.48 billion in 2011 to 97.36 billion in 2016http://mobithinking.com/mobile-marketing-tools/latest-mobile-stats/c#mobilemessaging http://www.juniperresearch.com/viewpressrelease.php?pr=242 4. OTT vs. SMSOver-the-Top (OTT) messaging vs. SMS messaging OTT messagesSMS messagesMMS message20113492 billion7844 billion207 billion20125846 billion8600 billion228 billion201620,293 billion9554 billion277 billionSources: Portio Research Febuary 2012 via: mobiThinking 5. Lost Opportunity = Lost ProfitsSMS business growth has attracted spammers, fraudsters, and illegitimate users, resulting in revenue leakages and lost profit potential for MNOs. Asia is the largest mobile market in the world and Asia Pacific has the highest volumes of A2P traffic per capita. Over 700 million mobile subscribers in Africa represent the second largest mobile market and has been growing at 20% per annum. Over 270 million spam messages are sent every day worldwide. 95 million spam text messages are processed per day in Europe & America alone.Some MNOs report revenue leakages of >10%. This can be much higher in certain cases! 6. The Market RealityConsumers are not best placed to protect themselves from SMS Spam & FraudMarketers will always find a way to spam consumersThe activities of regulatory authorities are well-intended but not very effective in practice and many a time they encourage selfMNOs would gain a competitive advantage (both reputation and revenue) if they implement the necessary control measures. 7. Are you protected?Do you have the necessary tools to recover revenue leakages generated through grey routes?Prevention is the only way forward to combat mobile spam effectively, whilst protecting subscribers and the network resources. 8. A Real CaseAs seen in our case studies with previous trials, operators were unaware of their interworking/noninterworking international traffic ratio, and assumed that A2P was only between 20% to 30% of their overall traffic.InterworkingNon-Interworking 9. Number CrunchingAssuming that each subscriber receives 2 messages a month.Estimated Connections: MNO. : 40M Subs WithMonthly Traffic Estimation MNO: 80M Int. Incoming SMS70% of your traffic being Interworking, leaving 30% lost to Grey Routes & an average Grey Routes Termination rate of $0.007MNO would be losing$2 Million p/a over Grey Routes If MNO were to block Grey Routes and charge as high as $0.06 for incoming traffic, MNO could potentially stand to make an additional:$17.3M p/aRevenue Increase 10. Benefits of Network Profiling Operator Blocked Grey Routes by GT/Country (not effective)Grey routes were thought to be less that 20% of incoming traffic Operator thought SRI to SMS ratio was balancedThought they were well equipped for SMS FraudBefore Trial After TrialFindings: Grey routes found to be greater than 45% of incoming traffic SRI to SMS ratio was unbalanced Wangiri Fraud amounted to only 1% of traffic Grey Routes, when blocked used alternate GTs and sourcesBenefits: Fraud identified and countered Revenue leakage stopped Extent of Grey Routes identified and monetized. New Revenue Streams! Accurate statistical data and reports presented Zero Capex 11. A Guide in Five StepsRequest an Audit/Profile of Your NetworkChoose a solution with analytics & alerts to be able to pre-empt fraudEnsure you have blocking control and dont rely on manual blockingChoose a partner who is an expert in the field to help combat fraudMost Importantly: Monetize the foregone revenues! 12. Your Benefits 13. Thank You email@example.comContact one of our offices:HAUD SystemsMalta : +356 99942342 Sweden : +46 851062770 UK : +44 2035192610 Singapore : +65 68366995www.haud.com