The Next Frontier: FTEU

Granted, it\’s another acronym. But some industry leaders believe
FTEU could dramatically change the industry.

Supporters and people interested in Sen. Barack Obama can sign up to receive text messages with periodic updates about the candidate, but as the campaign advises, \”standard service charges may apply.\” What if Obama and other candidates could send text messages without it costing the recipients?

That\’s what some mobile marketers are pursuing. In industry speak, it\’s called Free To End User, or FTEU. In summary, it means the end-user would receive text messages, but if a third party pays to send a message, the recipient won\’t be charged on a per-message basis or have it count against them in a text bucket plan.

The Mobile Marketing Association (MMA) has established guidelines on FTEU, and industry sources characterize it as being in the trial stages of implementation.

Some issues yet to be resolved include how much operators will charge marketers to send messages and what types of messages operators will approve. For example, if a collection agency starts frequently pinging people, that might not play well with the subscribers, even if they aren\’t paying for the messages.

Another big issue is making sure mobile operators\’ billing systems can handle FTEU. The process requires that mobile operators detect when a message should not be billed to the end-user and when it should be paid for by the sender. It\’s a business that aggregator mBlox knows well. It was created in Europe around the process of message termination. In Europe, where the model for voice calls was always based on calling-party pays, a similar model was adopted for text messaging, so the sending party pays. That makes it easy to use an FTEU approach.

In the United States, where calling-party pays is not the norm, mBlox is in a testing phase with at least one major unnamed operator. \”What we\’re trying to do is create a whole new industry model that says people want information, (but) they may not want to pay for it,\” said Steve Livingston, chief marketing officer at mBlox. \”I think it\’s going to significantly change our industry. It\’s one of those things where everybody wins.\”

The expectation is marketers would pay maybe on the order of 10 cents or less per message, but if it\’s used to replace reminders that historically are sent by mail, they would save on the price of a stamp. Use cases could include doctor or dental offices, as well as the financial/banking and airline industries that might want to drive down their own costs.

Mobile marketing firm mobileStorm is working with a company in the health care industry that would like to use FTEU, according to Jared Reitzin, CEO, founder and chairman. The theory is patients could opt in for appointment reminders, and while sending text messages would be an expense for the healthcare provider, it\’s still much lower than the money it loses when someone misses an appointment.

\”It\’s going to be a game changer,\” said Michael Becker, executive vice president of business development at mobile marketing firm iLoop Mobile. For one thing, not everyone is signed up for an unlimited text messaging plan, so such a system would open it up to the masses. And there are implications for politicians. Undecided voters, in particular, might be good targets because they wouldn\’t have to pay for learning more about candidates.

Others are not so sure it will make a major impact. If FTEU were adopted a couple years ago, it might have had a bigger impact, but now so many people are signing up for unlimited text messaging plans, it doesn\’t matter as much, said Rich Begert, president and CEO of aggregator SinglePoint. Still, his company is talking with all its carrier partners about it.

Who knows? Perhaps political candidates in the future will use FTEU to send free text messages to supporters asking for their donations.