SMS Is Changing | What A2P 10DLC Means For Your Business

What's going on everybody? It's Richard Kohberger here, the blue collar nerd. So I have some complicated and arguably not great news for you. It involves Congress and the FCC and mobile carriers like Verizon and AT&T and you. It's something called a 2P10 DLC. So what the heck is that? Well, 10 DLC, that's a 10 digit long code. It's what non telecom industry people and non aliens would refer to as a regular phone number. And a 2P, that stands for application to person. So this is a new protocol that changes how businesses using some sort of application to communicate with individuals, with people need to go about doing that. So before this change, there were basically two routes that a company could use to send messages to its customers. And we'll think of them as like two roads. So one road was like a really major highway, like a paid turnpike. And this turnpike was short codes. So if you've ever received a text message from a business that came from like a five to six digit phone number, that message came from this highway. Now the benefit of this big turnpike is that it's huge. It was built for this. So companies would get really high throughput, meaning they could send lots and lots of messages all at one time without having to wait. It also offered really good deliverability rates. So there wasn't a very high chance that a carrier like Verizon or AT&T would filter that message because messages coming down this highway were considered more reputable. Now the downsides were that this highway, this turnpike, was really expensive to use and you had to use these short codes, which weren't very personal. A lot of companies, especially local companies, prefer to use regular phone numbers that appear to be from the area. And so for those reasons, many companies used the other road, the 10 DLC road. But this road was not built for this. This road is more like a just regular suburban back road. So that means worse deliverability rates. There was a higher chance of your message getting filtered, lower throughputs, you can't send as many messages all at one time. And because there was less of a process to get on this road, it meant that spammers were using it left and right. Okay, so talks about doing something about this problem started a while ago, I want to say around 2018. So congressional leaders and the FCC, they were looking at these phone providers, Verizon, AT&T, Sprint, and they were saying, hey guys, you kind of need to do something about this. And the carriers were like, oh yeah, yeah, yeah, don't Even worry about it. Don't worry about it. We're on it. And then some time would pass and the FCC Congress be like, guys, you really need to do something about this. And the carriers again would be like, oh that, oh yeah, we're on that. Yeah, don't even worry about it. We're gonna take care. So finally the FCC and the congressional leaders, they said, hey, do something about this or we're going to be imposing regulation. So this, this A2P10 DLC. This is the result of that. Okay, so at the beginning of the video I framed this as news that you might not like. But so far it's just been like, yeah, okay, whatever, some new back end highway, whatever. What does this mean for me? Well, it means a few things, but the one I don't think you're gonna like is. Drumroll, please. Fees. It means there's gonna be more fees. So the carriers have built a new road and it's not quite as small and dinky as the suburban back road, but it's not quite as big and expensive as the short code highway. It's somewhere in the middle. It's not as expensive as that big highway, but it's not free either. So how this works is there's an initial registration process and registration fee. The registration fee is four bucks. It's not a big deal. I should rephrase. It's four bucks right now at 2:26 on June 8th of 2021. It could change. I'm just giving you the information that is here right now. So once your brand is registered, you'll be assigned a reputation score. And that score basically says that you're legit, you're a real company and you're allowed to be sending text messages through this highway. Then after that there's a $10 per month fee to stay registered and then there's a per text message surcharge. And that surcharge is fractions of a penny. Now a caveat is that surcharge, that per text message charge, it's not universal. Different carriers charge differently and the charge comes from the receiving party's carrier. Meaning when you the business sends a text message, unless you happen to know that person's phone carrier, you don't know exactly how much that text message is going to cost. Pretty sick, right? I know. So how this works is Servicetitan uses a messaging API to send all of your Messages. That messaging API, that's the A, that's the application in the A2P. In the application to person, the fees will be charged for from Servicetitan. You'll see them broken out separately on your bill from Servicetitan. But I wanna make this very clear, this is a pass through fee. Servicetitan is a very temporary middleman for that money. So ServiceTitan makes a 0% profit margin on that fee. They're simply charging you exactly what they're being charged so that they can pass it forward. So once the fees are paid to Servicetitan, Servicetitan then actually splits them because the fees go to separate entities. So the initial $4 registration fee plus the $10 per month stay registered fee, that goes to an entity known as the Campaign Registry. And then those per message surcharges, those are paid to ServiceTitan's messaging API, which then turns and pays them back to the MNOs or the mobile network operators AT&T Verizon, those guys. So once you get registered, Servicetitan is going to set up a single what's called mixed use campaign. It's mixed use because it's going to be for things like automated dispatch texts as well as internal text to your team as well as texts out to your customers. So I've given you kind of a broad idea of what this would cost. It's the initial $4 to register, $10 per month to stay registered, and then a fraction of a penny per text message. But I understand that's kind of hard to conceptualize and you might be a little nervous about what this is actually going to mean. Well, I can tell you that right now, as the fees stand today with average messaging use among Service Titan clients using the features exist as of me posting this video. So chat alerts, dispatch texts, all that stuff, the average cost should land somewhere between 20 and $50 per month. Now hold up. Disclaimer, disclaimer, disclaimer. That's with average use if you're the average Service Titan user. If you're a really big company, you'll probably exceed that range. That's also average use with the existing Service Titan features as of the publishing of this video. So if your text message usage increased because maybe Service Titan now has alerts for recurring service reminders or some SMS marketing features. I mean, gosh, I mean, who knows if anything like that's being worked on, but theoretically, if it was and then that came out and you used it, that would increase your usage and therefore increase your fees. That's also with the fees as they stand today. Service Titan has no control over these FEES. But the MNOs, the mobile network operators could wake up one day on the wrong side of the bed and decide to double them out of nowhere. So, yeah, look, obviously I've gotta do a lot of butt covering here. I've gotta put a lot of disclaimers out there, but I wanted to do you the service of saying a real number and not just leaving it up to your imagination about what this is actually gonna mean for you and your business. It may not be accurate for you. There are edge cases, it may not be accurate forever. Things change. And Service Titan has no control over any of this. But as things stand right now, that's the average 20 to 50 bucks per month. Now, if you're wondering like, do I have to do this? Is there a way to opt out? I mean, you don't technically have to, but if you don't, your delivery rates will drop to zero or close to it. The mobile network operators really want all mobile text messages sent through one of the dedicated highways. Either this, the 10 DLC, a 2P highway, or the other short code highway. Business messages still hanging out on that suburban road, they're just going to get filtered out and they're not going to get delivered. This is a change happening to business text messaging in general. By the way, this is not specific to Service Titan or our industry or anything besides businesses. Now, on the bright side, because when you use this highway, you're registered and have a reputation score and the network operators know that you're legit, you should have very good deliverability rates. So if that's a problem you're having now, some of your text messages aren't going through, this should definitely help with that. And because this is a more robust highway meant for businesses to use, you'll be able to get higher throughput, meaning you can send more text messages all at once. As things stand right now, that probably doesn't affect you unless you're a super big company sending out tons and tons of dispatch texts all at once. But again, if theoretically there were some sort of SMS marketing platform, again, who knows if that's being worked on, but if there was, you'll be able to send a lot of text messages all at once versus if you were on the old road before this change, you would have had to sit there and wait for it to send messages out like one by one. So there is some benefit. I understand that paying fees that you used to not pay, obviously that sucks, but hopefully I've done a decent job explaining it. It is kind of a complicated situation. So in order to get started with this, go to your service titan settings, and under the your account section you'll a new link called Brand Registration. There you'll find a form you can fill out, and once you submit that, ServiceTitan will initiate the registration process for you. Try not to put this off. I know you've all got other things going on, but like I said, failure to register will eventually lead to a major disruption of your business as your SMS delivery rates drop to near zero. If you have any questions, feel free to leave a comment in the comment section down below. If you thought I did a decent job explaining all this, please hit that like button. It would mean the world to me. And subscribe to Service Titan's YouTube channel if you haven't done so already. Appreciate it. Peace.