Global Rich Communication Services (RCS) Market Ascends at a Healthy CAGR of 35%

Introduction

The framework between phone and mobile service providers is the rich communication service. The conventional MMS and SMS messaging services utilized for the past several decades will be replaced by a rich communication system. All of these features are supported by data networks, and the rich communication service technology is comparable to that of WhatsApp or Telegram, where live chatting is possible. This system allows users to chat on their mobile devices using text, GIFs, short audio recordings, and emojis without needing a third-party application. Numerous factors contribute to expanding the global market for rich communication services, including the increasing number of online marketing & advertising firms and the escalating growth of voice-over long-term evolution technology (VO-LTE) and mobility services. In addition, the expanding adoption of cloud-based services for managing mobile content by small and medium-sized businesses fuels the expansion of the global market for rich communication services. However, limited end-to-end encryption and rising competition from over-the-top platforms impede the growth of the worldwide market for rich communication services.

Market Dynamics

The Increasing Awareness About RCS Benefits Over Regular OTT Services and The Number of Marketing & Advertising Competition to Drive the Global Rich Communication Services (RCS) Market

People frequently use over-the-top systems such as Skype, WhatsApp, and Facebook Messenger; however, technological progress has increased the likelihood of cyber threats targeting this platform. This leads to critical data and privacy loss. RCS messaging offers enhanced protection against such occurrences. Since operators control the networks over which messages are delivered, RCS has many advantages over conventional OTT platforms, allowing for superior service. 

Another advantage of RCS is its interoperability between operators. This enables RCS users to communicate with most mobile device users, such as iOS, Android, and Windows users. This directly combats a significant disadvantage of many OTT services: only users who have installed the relevant app can communicate. This factor will drive the expansion of the RCS market during the forecast period. 

In addition, marketing and advertising campaigns are very costly and time-consuming for businesses, as they require many hardware products for interactive marketing, a robust IT infrastructure, and the physical participation of individuals to create the most effective advertisement. However, it is challenging for SMEs (small and medium-sized) businesses to spend so much time and money on each product. However, due to improved communication resources and rising technological adoption, SMBs are shifting focus to digital and social media marketing. 

The communication service offers superior metrics and data analytics compared to other digital marketing tools and strategies. Businesses can determine whether a recipient has viewed a message with the recipient's response. RCS messaging provides a cost-effective messaging system, expected to increase its popularity among small and medium-sized businesses. This characteristic propels the expansion of the global market for rich communication services during the forecast period. 

The Increased Prevalence of 5G Networks to Create Global Rich Communication Services (RCS) Market Opportunities

The 5G wireless network facilitated the exploitation and development of vast capacity and connectivity of a robust and intricate heterogeneous infrastructure. Therefore, efforts to make the 5G network more capable of handling complex operational contexts and supporting a wide range of new services have increased. Rich communication services require a fast and secure network, which 5G networks provide, creating a lucrative growth opportunity for the rich communication services market. Major industry players are also interested in investing in 5G network technology to provide superior customer service in the future. 

Regional Insights

North America is most likely to grow at a CAGR of 31.2% and command the market. In North America, the market growth for rich communication services is driven by the widespread adoption of 5G networks, the growing use of artificial intelligence, and the proliferation of smart connected devices. In addition, the rise in demand for digital transformation among numerous end-users and the convergence of various technologies, such as cloud computing and artificial intelligence, have substantially impacted the region and increased its IT and telecommunications budgets. 

Rich communication service enables MNOs (mobile network operators) to implement services based on the most advanced technology under development for the native messaging channel. In addition, the increasing adoption of cloud-based architecture in various industries, such as healthcare, retail & e-commerce, BFSI, IT & telecommunications, and travel & tourism, fuels market expansion. 

The Asia Pacific will hold a revenue share of USD 10,222 million, growing at a CAGR of 40.15%. As a result of the emergence of high-end technologies such as artificial intelligence and the 5G network, the increasing need to send marketing messages in bulk, and the significant shift toward digitization by small and medium-sized businesses, the market is growing in Asia-Pacific. In addition, Asia-Pacific's IT & telecommunications, BFSI, and retail industries are investing aggressively in advanced communication services, driving the RCS market growth. 

In addition, market leaders have expanded their presence in emerging nations such as India, China, and Japan over the past decade. The demand for high-end cell phones and variable devices is rising. They are making substantial investments in these countries with cutting-edge technology. It is anticipated that this will increase the confidence of Asia-Pacific businesses to adopt rich communication services, thereby accelerating the adoption of these services by end-users. 

Key Highlights

• The global rich communication services market had a revenue share of USD 2,034 million in 2021, envisioned to reach USD 22,440 million growing at a CAGR of 35% during the forecast period.
• Based on the deployment model, the cloud model is estimated to project a CAGR of 36.7% and hold the largest market share.
• The large-scale segment is projected to grow at a CAGR of 33.6% based on enterprise size and hold the largest market share.
• Based on applications, the rich calls & messaging segment is expected to advance at a CAGR of 30.4% and hold the largest share.
• Based on industry vertical, the retail & e-commerce segment is estimated to grow at a CAGR of 40.5% and hold the largest share.
• Based on regional analysis, North America is most likely to grow at a CAGR of 31.2% and command the market.

Competitive Players

Competitive Players in the Market

• AT&T Inc.
• Vodafone Idea Limited
• Google LLC
• Verizon Communications Inc.
• Deutsche Telekom AG
• China Mobile
• Ericsson
• Huawei Technologies Co. Ltd
• ZTE Corporation
• SK Telecom.

Recent Developments

Market News

• In 2022, Google LLC announced the acquisition of Raxium, an innovator in single-panel MicroLED display technologies.
• In 2022, Verizon Communications Inc. and McGraw Hill announced the launch of a new mobile application that can bring augmented reality learning activities to K-12 students and classrooms.

Segmentation

Global Rich Communication Services (RCS) Market: Segmentation

By deployment model

• Cloud
• On-premise

By enterprise size 

• Small & medium scale enterprise
• Large scale enterprise

By applications

• Rich calls & messaging
• Content delivery (content sharing, file transfer)
• Value-added services (VAS)
• Marketing & advertising campaign
• Cloud storage

By industry vertical

• Healthcare
• Retail & e-commerce
• BFSI
• IT & telecom
• Travel & Tourism
• Others

By region

• North America 
• Europe
• Asia Pacific
• LAMEA