Telcos in a battle for text dollar

By PETER GRIFFIN


Telecom's fledgling eTXT service has hit a hurdle after Vodafone blocked text messages sent to its network via the service in a stoush that goes to the heart of the lucrative text messaging business.

The eTXT system allows a user sitting at a PC to compose and send mobile text messages en masse to colleagues or clients.

The messages are written in a simple software add-on to email program Microsoft Outlook and sent out across the internet and onto the mobile networks of Telecom and Vodafone.

That was until a few days ago, when Vodafone began blocking text messages sent via eTXT, to which Telecom customers can subscribe for a sign-up fee of $112 and $11 a month. Messages sent to Telecom mobiles are charged at 11c each, while messages to Vodafone mobiles are charged at 21c.

The blockage caused Telecom to write to its eTXT customers outlining the problem. It has also begun re-routing text messages via international text message aggregators to try to side-step the blockage.

Messages coming into Vodafone's network from overseas cannot be easily identified as coming from Telecom.

Vodafone's head of carrier relations, Francois Zegers, said the eTXT messages were being blocked because Vodafone was worried the service would be hijacked by direct marketers intent on sending out text spam.

"It's a divergence of views on how to implement eTXT. There are competing interests between those of customers and those of direct marketers. Telecom has taken a slightly different view to us," said Zegers.

New Zealand has so far been largely immune to text spam, the bulk transmission of unsolicited text messages to mobile users.

But the eTXT stand-off may be symbolic of a bigger battle, one for the text messaging market. Telecom and Vodafone have no agreement in place for passing eTXT and picture (PXT) messages between their networks, despite extensive negotiations.

Vodafone has had the upper hand in the text-messaging market but appears to be playing hardball with Telecom, which has attempted to challenge Vodafone's dominance with a $10-a-month flat-rate text messaging offer.

"We currently don't have terms of agreement with Vodafone for those messages," said Telecom spokesman John Goulter.

"We're routing through a third party. It's a common way of getting into that sort of market."

Zegers said there was "no flexing of muscles" going on from Vodafone's side.

"Other than saying that we don't want our customers receiving spam," he said.

Telecom hoped to be able to hammer out a deal soon covering mobile termination and termination for PXT picture messaging.

It is a situation that harks back to the early days of text-messaging where, because of competitive posturing, text-messaging between the Telecom and Vodafone networks was for some time impossible.

For wireless computing specialist Rocom Wireless, the battle of the carriers has resulted in it picking up more business. Rocom runs a similar service to eTXT, known as easiTXT. Although it is slightly more expensive than Telecom's service, the software is more sophisticated and easiTXT messages can be sent to both networks.

"It's meant a little windfall for us," said Rocom's Grant Crawshay.

"People have got upset by it and are coming across to us. We can use both carriers directly."

Telecom claims eTXT is not being aimed at direct marketers but at companies wanting to contact staff or clients who are constantly on the move.

"For direct marketing purposes, people would be charged at least 10c per message, which would make it an expensive method of direct marketing," said Goulter.

Vodafone, which is increasingly encountering text spam in its sister companies around the world, has developed an online opt-in service for customers, allowing them to select what commercial messages they are happy to receive.

It had also released a service aimed at direct marketers wanting to undertake text-messaging campaigns. Vodafone's Mobile Tool Box appears to be a direct competitor to eTXT, a factor which may be contributing to the wrangle.

Vodafone's service comes with a substantial price tag - $7875 start-up cost and $563 a month. The marketer is charged 23c for each message sent out. Consumers pay nothing to receive the text messages.