According to a new report by Juniper Research, over-the-top (OTT) business messaging traffic, led by platforms like WhatsApp, is projected to skyrocket from 390 billion messages in 2025 to more than 560 billion by 2027, marking a staggering 45% growth in just two years.

At the heart of this surge lies WhatsApp’s game-changing pricing model. The Meta-owned platform has slashed authentication rates, the kind used for one-time passwords (OTPs) and verification messages, by 50–90% compared to traditional A2P (Application-to-Person) SMS.

The move is no coincidence; it’s a calculated step to win over enterprises that have long depended on network operators for secure user communication.

“By first securing authentication traffic, WhatsApp is laying the groundwork to move into higher-value business messaging,” explained Molly Gatford, Senior Research Analyst at Juniper Research.

“Once enterprises are onboarded for authentication, WhatsApp must upsell to marketing use cases, where termination fees are far higher and the real revenue opportunity lies.”

Why it Matters to your Business

For years, mobile network operators dominated the enterprise messaging market through A2P SMS, powering everything from OTPs to promotional campaigns. But the rise of OTT players like WhatsApp, Telegram, and Viber has changed the rules, offering richer engagement, encryption, and global reach at a fraction of the cost.

In Nigeria and across Africa, where businesses are doubling down on digital transformation and financial inclusion, WhatsApp’s expanding footprint is poised to influence how banks, fintechs, eCommerce brands, and even government agencies communicate.

Imagine receiving your transaction alerts, delivery notifications, and customer support all through one WhatsApp chat, secure, fast, and cost-effective. That’s the future Meta is betting on.

The Operators’ Dilemma

Juniper’s report warns that mobile operators must rethink their approach — and fast. To remain competitive, operators will need to adopt “use case-based” pricing models for both SMS and RCS (Rich Communication Services), leveraging AI-powered analytics to classify and price messages more intelligently.

This strategy could help them highlight the added value of RCS, Google’s SMS evolution, which supports multimedia, interactivity, and verified business profiles, while maintaining telco control.

“By adopting a use case-based pricing strategy that is consistent across SMS and RCS, operators will enable enterprises to better assess RCS’s added value,” Gatford noted. “This helps operators retain business messaging traffic across these channels and avoid losing market share to OTT platforms.”

Looking Ahead: Opportunities and Risks

The A2P & Business Messaging Market 2025–2030 report, which includes forecasts across 61 countries and 146,000 datapoints, suggests that the coming years will see a tug-of-war between OTT disruptors and traditional network providers.

While WhatsApp may currently hold the pricing advantage, operators still have one critical edge, trust and infrastructure. Enterprises handling sensitive data, such as banks and public institutions, continue to rely on carrier-grade security and compliance frameworks that OTT players are still catching up to.

Still, the momentum is unmistakable.

As enterprises chase more personalized, real-time engagement with customers, the boundaries between messaging platforms and telecom networks are blurring.

The winners of this new era will be those who adapt fastest, whether it’s through collaboration, pricing innovation, or leveraging data-driven insights.

Insight:

With WhatsApp Business API already powering millions of customer interactions across Africa, Nigeria’s telecoms and fintech players face a strategic choice, compete, collaborate, or risk being sidelined in the next wave of digital customer engagement.

By harnessing machine learning, natural language processing, and real-time data analytics, telecom companies are collaborating with cloud communication platforms, evolving from traditional service providers into tech-driven innovators—often referred to as “techcos.”

This shift opens up new revenue streams, positioning telecom operators as key players in the digital economy.

AI enhances customer experience

At the forefront of AI’s influence is the way it improves customer interactions. By analysing vast amounts of data, AI personalises engagements through tailored recommendations and promotions, predicts maintenance needs such as customer interactions and feedback to identify trends or potential issues, and proactively manages services.

AI-powered virtual assistants and chatbots offer customers quicker resolutions and a more reliable service, provide 24/7 support, and improve customer satisfaction and loyalty.

Optimising network operations

AI-driven network solutions are reducing congestion and enhancing operational efficiency. Advanced AI algorithms monitor large volumes of real-time network data, enabling telcos to identify potential issues, predict failures, and optimise traffic flow.

For example, AI can automatically adjust network settings to redirect traffic during periods of congestion or equipment failure, minimising disruptions. AI-driven network optimisation extends to energy management as well, where it adjusts power consumption based on predicted peak usage times, contributing to more sustainable operations.

Driving innovation

AI is also driving innovation within telecoms, fostering new services and business models. With the integration of AI and 5G networks, telcos are expanding into industries like healthcare, agriculture, and logistics, offering smart IoT applications that manage resources in sectors such as smart cities and energy grids.

This creates opportunities for telcos to venture into new markets and provide cutting-edge services, like smart home solutions and AI-based IoT integrations that meet the evolving demands of the digital economy.

Improving decision-making

AI’s ability to process and analyse customer data in real time enables telcos to make informed strategic decisions.

The data-driven insights from AI allow operators to anticipate customer needs and market trends.

With 65% of customers reporting higher satisfaction from AI-powered interactions, telcos can create more engaging and predictive CX journeys, resulting in increased Average Revenue Per User (ARPU) through smarter upselling and cross-selling initiatives.

Addressing key challenges

AI is also instrumental in solving some of the persistent challenges faced by Mobile Network Operators (MNOs):

• Network Congestion: AI predicts and manages traffic patterns, dynamically adjusting resources to prevent congestion and ensure efficient network performance.
• Competition: Predictive analytics help MNOs understand market trends and customer preferences, enabling them to offer personalised services that stay ahead of competitors.
• Churn: By analysing customer behaviour, AI identifies potential churn risks, allowing operators to implement targeted promotions and improve customer support, thereby retaining customers.
• Fraud: AI’s sophisticated algorithms detect and prevent fraudulent activities in real time, protecting the network and its users. AI’s fraud detection is already highly successful, with over 90% of companies reporting real-time fraud prevention.
• Sustainability: AI contributes to sustainable practices by optimising energy use in network operations, adjusting power consumption based on anticipated peak usage times.

Monetising AI in telecommunications

The integration of AI presents a wealth of monetisation opportunities for telecommunications companies.

AI-driven services such as advanced analytics, network management tools, and personalised customer experiences not only attract new customers but also enhance retention among existing users.

Internally, AI-powered tools streamline processes, reduce operational costs, boost efficiency, and drive profitability.

For instance, conversational AI chatbots automate routine enquiries, such as balance checks, top-ups, and FAQs, significantly lowering customer service costs.

These tools handle high volumes of interactions simultaneously, ensuring faster response times and freeing agents to address complex issues.

Predictive AI analytics further drive revenue by enabling precise upselling and cross-selling opportunities, such as recommending data plan upgrades to customers approaching their limits.

Telecom leaders around the world have harnessed AI through Communication Platforms as a Service (CPaaS) solutions.

These innovations allow customers to perform actions like bill payments, subscription management, and support queries via messaging platforms like WhatsApp and RCS, simplifying customer interactions and driving engagement.

Notably, McKinsey’s research highlights the financial advantages of AI adoption, with AI-leading companies achieving a five-year revenue CAGR 2.1 times higher than their peers and delivering a total return to shareholders 2.5 times greater.

This underscores the transformative potential of AI for telcos striving to remain competitive and profitable.

Preparing for AI integration

Before integrating AI, MNOs need to carefully consider several critical factors:

1. Data Privacy and Security: Compliance with data protection regulations is essential, ensuring customer data is handled securely.
2. Technical Expertise: Telecom companies need to either build or acquire expertise in AI and data science to manage AI integration effectively.
3. Infrastructure Compatibility: Assessing and upgrading existing infrastructure is crucial to support AI technologies.
4. Change Management: As AI becomes integral to operations, staff training, process adaptation, and alignment of business strategies with AI capabilities are necessary.

Overcoming barriers to AI adoption

Despite the benefits, several factors hold back some MNOs from adopting AI. The investment required for AI technology, including infrastructure upgrades and skilled personnel, can be prohibitive due to high initial costs.

Integrating AI into existing systems and processes presents complex implementation challenges. Managing the vast amounts of data generated by telecom networks, particularly with legacy systems, can be daunting.

Additionally, navigating the regulatory landscape concerning data privacy and AI ethics adds to the complexity.

Organisational inertia and resistance to change further slow-down the adoption of new technologies.

By addressing these challenges, telecom operators can effectively leverage AI to transform their operations, enhance customer experiences, and unlock new revenue opportunities while boosting efficiency and fostering customer loyalty.

The future of telecommunications is undeniably intertwined with AI, promising a more efficient, innovative, and customer-centric industry.

Infobip recorded new levels of total customer communications interactions on its platform this year, with 3.4bn interactions on the day of Black Friday, which represents a 26% increase when compared to last year.

From the total number of interactions, the company identified 1.8bn coming from messaging interactions on its platform, up from 1.7bn last year.

Infobip’s analysis reveals SMS, E-mail and WhatsApp are the three most preferred channels on Black Friday, recording more than 1.6bn interactions during the day.

This Infobip’s messaging analysis reinforces the company largest messaging platform worldwide, and its reliability for brands during shopping season.

Rich communication channels such as RCS, have recorded significant growth this year, as brands seek convenient and conversational channels that enable end-to-end customer journeys.

This year, RCS interactions on Black Friday increased 17% compared to a typical day in November and increased 388% compared to last year.

Infobip also reveals that, in this year’s Black Friday, Retail & eCommerce and Finance industries are between the top 5 sectors which generated interactions in the company’s platform, presenting increases of 42% and 36%, respectively, when compared to last year.

As predicted, Infobip’s data reveals that Black Friday sales extended across the entire month of November. Interactions across the whole month were higher than last year as brands sought to attract consumers looking for discounts pre-Christmas.

Ivan Ostojić, chief business officer at Infobip, said:

“Rich Communication Services (RCS) have emerged as a significant channel for shoppers this Black Friday. The increase is driven by consumers seeking conversational experiences with brands and businesses seeking to provide end-to-end journeys for their customers in one channel. Moreover, brands’ focus on hyper-personalization has helped drive conversational customer experiences and, we expect, will have boosted sales. Our research also shows the traditional Black Friday discount days now typically stretch across November, with a big spike in interactions across the whole month as retailers and eCommerce firms seek more cost-conscious consumers this year.”

Despite these storms, the financial services industry is still delivering good profits and growth, but there is constant pressure to maintain these results amid the adverse market trends and pressures that are currently shaping the landscape.

While South Africa’s established banks and financial institutions remain the powerhouses in the banking space, new entrants in the market are making a name for themselves in both the high and low Living Standards Measure (LSM) brackets.

Some are making inroads in traditional markets and while others are looking to disrupt the underserviced digital space.

This has led many banks and financial institutions to look at achieving agility and to transform several of their strategic imperatives, such as how to become a more customer focused enterprise, how to adopt new operating models quickly and effectively, and how to optimise risk and compliance while doing that.

Opportunities are available for financial institutions wanting to explore the market and reinvent their enterprise to increase their relevance for their customers.

However, these organisations need to embrace emerging technologies that make it possible for them to strengthen their digital core and leverage the power of cloud, data and Artificial Intelligence (AI) in order to reach new performance frontiers.

Technology now an enabler

Technology – once viewed as a disrupter – is now an enabler that helps organisations to enhance their productivity, transform the cost of structures, engage with customers in novel ways and develop completely new propositions.

As a consequence, the banking and financial services industry as a whole is being transformed by technology advancements, changing customer preferences and nimble new players.

At the same time, one of the biggest challenges that traditional banks still face is trying to adapt to the high costs in the industry, including that of maintaining physical branches.

A number of organisations are thus looking to transform the engagement with their customers and are seeking to bring efficiencies into their branches.

Despite these challenges, Africa is still one of the few places in the world where significant changes have taken place over the past few years, in some cases more so than in developed countries.

According to market research, the growth in mobile banking in parts of Africa is among the fastest in the world.

This is because customers are expecting more from financial institutions and are clamouring for a superior cross channel experience, coupled with hands-on guidance and personal intervention when required.

Beyond the product

These heightened customer demands will require financial organisations to go beyond the product and facilitate the customer journeys and create customer experiences that are data-driven, consistent across customers’ channels of choice and complete with personalised engagement.

Essentially, we are entering the age of the conversational transaction where more and more communication apps are becoming part of bank customers’ end-to-end experiences.

Behind customer demands are a number of accelerators driving this new technological transformation.

These include hyper-personalisation, automation and 24/7 availability, as well as technological shifts towards the use of Digital channels, AI-driven tools (including chatbots and self-service), rich messaging apps and upgraded legacy voice/video channels.

Other accelerators include substantial increases in cloud contact centre interactions, chat apps being used as key channels for marketing, sales and support, and year-on-year growth in the use of digital channels (for example WhatsApp and RCS) for customer communication.

The data-driven journey can be summed up as one of continuous awareness creation and engagement through personalised recommendations based on profile scoring, to stimulate consideration and transaction with ongoing customer care and retention.

This includes seamless agent intervention and handover when needed, ultimately creating loyalty with the drive and aim to increase customer lifetime value.

Experts at Infobip made this call during a media parley in Lagos this week.

Leading the team, Olatayo Ladipo-Ajai, regional manager at Infobip Nigeria, said that Nigerians, particularly businesses, such as banks, telecommunication companies and other businesses should harness the benefits posed by the RCS to improve their customer experience and reach more customers.

He described Rich Communication Service (RCS) as a mobile messaging protocol that can delivers more interactive mobile text messaging experience than traditional plain-text SMS messages.

He noted that Conversational messaging, in the form of RCS, will enable businesses and brands to communicate more effectively while reaching out, attracting and converting potential customers.

According to him, “RCS is an evolution of SMS, which integrates features from various chat apps into one platform.

“The platform allows the exchange of group chats, PDFs, video, audio and high-resolution images, as well as read receipts and real-time viewing, providing more value than traditional SMS.

“One of its key benefits is that RCS sits on top of the SMS platform, which means it has the same reach and is thus also native on most smartphones”.

On his part, Martin Effiong, Senior Operator Partnership Manager, West Africa, at Infobip, said RCS’s rich media capabilities can provide a foothold for MNOs not only in business communication space but also in the P2P market where OTT players currently dominate.

RCS provides a solution for MNOs to compete with OTT players and claw back some of the revenue they have been missing out on in both the P2P and the lucrative Application-To-Person (A2P) messaging space.

– Effiong

He further described RCS as a rich media capable communication protocol that is an evolution of SMS as a native messaging channel.

“With RCS, mobile operators are able to provide their subscribers, as well as enterprises, with a messaging system that has the capability of sharing and receiving content such as images or videos without the need to download a separate messaging app.

“With many enterprise-focused features such as chatbots or carousels (content slideshows), brands are able to provide a convenient customer engagement channel for various use cases, ranging from tech support to purchases, as part of the conversational commerce paradigm,” he said.

Also speaking, Isaac Akanni, on “Boosting profitability and enhancing deeper customer engagement with conversational banking”, said that RCS is integral to conversational banking which can be seen as an upgraded version of SMS, complete with the rich features of a chat app.

The Rich features include images, videos, and audio files that can be seen in RCS messages and that provide a more engaging and personalised experience for customers.

– Akanni

“It also offers a wide range of features that can improve Customer experience (CX), including interactive functionality that enables customers to make bill payments or balance enquiries, while providing privacy and security through end-to-end encryption.

“The main value of incorporating an RCS channel is that it yields better customer engagement, increases trust and builds long-term customer relationships.

“By sending RCS messages, banks can ensure that customers gain higher visibility of their brand, while also presenting new offers and campaigns in a more effective way, such as information about loans, changing interest rates or new credit cards.

“Banks can also use RCS to send notifications or useful reminders about card activations or payment instructions.

“While RCS is new to the local market, the opportunities it presents are huge and use cases will grow exponentially as the channel gains traction.

“Conversational banking should ultimately provide a seamless flow of conversation to ensure positive CX and manage a host of complex transactions that will lead to a deeply rooted engagement that translates into a long-term relationship between a bank and its customers”.

Facts about Infobip:

But with the growing demand for an upgrade in SMS experiences to accommodate Rich Conversational Messaging (RCS) capabilities, branding, security and trust, RCS is gradually taking root, leaving Mobile Network Operators (MNOs) with few means to fight back in this segment.

At the same time, OTT channels are also becoming dominant in the enterprise communication space, given their prevalence and rich media capabilities, as well as largescale P2P adoption.

However, Rich Communication Services (RCS) may provide a solution for MNOs to compete with OTT players and claw back some of the revenue they have been missing out on in both the P2P and the lucrative Application-To-Person (A2P) messaging space. RCS is a rich media capable communication protocol that is an evolution of SMS as a native messaging channel, provided by Google in collaboration with MNOs.

With RCS, mobile operators are able to provide their subscribers, as well as enterprises, with a messaging system that has the capability of sharing and receiving content such as images or videos without the need to download a separate messaging app.

With many enterprise-focused features such as chatbots or carousels (content slideshows), brands are able to provide a convenient customer engagement channel for various use cases, ranging from tech support to purchases, as part of the conversational commerce paradigm.

Engaging communication experience

Since its launch in 2018, it took a while for telcos to adopt RCS and for enterprises to embrace it as a means of creating a more engaging customer communication experience. However, it is safe to say that RCS is now an established business communication channel.

At the same time, while OTT messaging apps have become the norm in P2P communication, RCS’s rich media capabilities can provide a foothold for MNOs not only in the business communication space, but also in the P2P market where OTT players currently dominate. Therefore, RCS is fast becoming an important part of telcos’ enterprise digital portfolio.

With that said, RCS still lacks wide P2P acceptance, as it is far from being the top choice for P2P communication. Yet, promoting RCS as a channel for P2P communication can add to the efficiency of A2P campaigns by the mere fact that more people would be using the channel and are more likely to respond, further growing already robust engagement stats.

A good first step for MNOs would be to start using RCS as a communication channel for their subscribers, providing tech support, sending statements and invoices, responding to purchase enquiries and other use cases to familiarise users with the channel and its features, while also allowing them to get hands-on experience with it.

No installation needed

A distinct advantage for MNOs is that their customers do not need to install any additional apps, as the messaging app that is native to most Android platforms just needs to be enabled for RCS. The adoption of smartphones and greater internet penetration in recent years means that RCS is likely to gain greater traction among P2P users. This means that the sooner MNOs start using the channel to communicate with their subscribers, the sooner it is likely to see widespread adoption.

Establishing partnerships with Communications Platform as a Service (CPaaS) providers can go a long way to driving RCS adoption, as CPaaS providers have been at the forefront of bringing RCS to enterprises in conjunction with MNOs, and have a range of tools for crafting customer journeys and managing channels.

As such, telcos can avoid the complexities of developing CPaaS-level tools and services by partnering with CPaaS players, and instead focus on their core strengths – that of building an RCS element into their networks.

The future of business messaging lies with RCS messaging – it is what consumers want, it is

what enterprises will need to provide, and will ultimately benefit from it as the engagement it offers is superior to that of any other digital channel.

These prevailing market conditions have ushered in challenging times, making it increasingly difficult for organisations to maintain and attract new business. Simultaneously, companies are finding that competition is increasing, which demands better and more creative differentiation than just better pricing to maintain a competitive edge.

All the while, consumer behaviour is also changing drastically, with an increase in numbers of Nigerian customers choosing to engage and transact with brands online.

The country’s internet penetration rate stood at 55.4% of the total population at the start of 2023, with 122.5 million internet users recorded in January 2023. Further to this, a total of 193.9 million cellular mobile connections were active in early 2023, equivalent to 87.7% of the total population.

Consequently, this prompts Nigerian businesses to explore more universal engagement routes to connect with their customers and interact via conversational messaging.

To successfully engage with customers in the digital space, businesses are increasingly making the shift towards hyper-personalisation, automation, and 24/7 availability, allowing their promotional campaigns and messaging to be directly targeted at individual customers.

Deriving more value

Brands in Nigeria are thus beginning to realise that customers do not fit into boxes but are individuals who need to be analysed to derive most value from customer engagements.

At the same time, it is also becoming clear that traditional SMS messaging is inadequate where achieving this level of engagement is concerned.

While SMS has played a critical role in business communication, the new realities around customer behaviour and expectations mean that traditional SMS messaging – which provides one-way engagement – has certain limitations such as gateways, DND (Do Not Disturb) and firewalls that often prevent promotional messages from reaching the target end customer, which may result to relatively low SMS open and read rates.

Conversational messaging, in the form of Rich Communication Services (RCS), can address many of these challenges, enabling businesses and brands to communicate more effectively while reaching out, attracting and converting potential customers. RCS is an evolution of SMS, which integrates features from various chat apps into one platform.

The platform allows the exchange of group chats, PDFs, video, audio and high-resolution images, as well as read receipts and real-time viewing, providing more value than traditional SMS. One of its key benefits is that RCS sits on top of the SMS platform, which means it has the same reach and is thus also native on most smartphones.

Better metrics

RCS allows for conversational engagement with customers who can be interacted with as a group or directly on a one-on-one basis, similar to apps such as WhatsApp.

A clear benefit for businesses is that RCS provides deeper metrics on whether a message has been delivered, opened and clicked, delivering better analytics for businesses to gauge how successful a promotional campaign has been.

The use cases for RCS are varied and a number of banks, retailers and hospitality businesses have started using it to send promotional and transaction messages to customers. For example, banks can send payment notifications as full colour, branded, PDF documents that can serve as payment receipts.

Some restaurants already use the card carousel feature to send their menus to customers to browse through the different pages and click on their desired options, without having to use the restaurant’s website or mobile app. Other use cases include the ability to send messages with a location pin from Google Maps, movie previews or QR codes that enable mobile payments by directing users to mobile payment platforms.

Conversational message provides a customer experience that not only focuses on problem-solving, but aims to build long-term relationships with customers, leading to greater customer loyalty, improved brand image and ultimately more revenue. By being conversational, businesses can deliver the best customer experience possible with advanced technology and readily meet changing consumer demands.

That’s according to a new white paper, “Unlocking multi-channel marketing with RCS”, published by mobile marketing automation experts, Upstream, which explores rich mobile messaging’s emergence as a vital part of the digital marketing mix.

RCS messaging allows MNOs and advertisers to create highly targeted media-rich messages that can be heavily personalized to engage and convert users.

Performance metrics, including open-rates and message interactions, can also be used to help advertisers optimize their content for maximum impact.

“Audiences today are very fragmented and have come to expect personalized communication. There is currently no single communication channel that fulfils all of these needs effectively, so marketers have had to adapt to using a blend of different channels to maximize engagement. RCS brings unique value to any multi-channel mix, combining the rich media capabilities of digital channels with the hyper-personalized engagement of the SMS world. The marketing use cases for the channel can only be limited by imagination,” said Kostas Kastanis, Upstream’s Deputy CEO.

Upstream’s data suggests that RCS is already becoming a vital tool in helping advertisers connect with users on a personal level, showcasing click-through rates (CTR) as high as 22.2% and a 37% rise in conversion rates over traditional SMS in a series of campaigns run across industries.

Since 2020 and its global roll-out from the Google Messages app, RCS has been gaining significant traction and the number of RCS-capable subscribers is expected to reach 3.8 billion by 2026.  

This emerging trend toward rich mobile messaging comes as third-party cookies, once the cornerstone of digital marketing, are to be retired permanently.

Advertisers that can no longer tap into third-party cookies as a means of reaching wide audiences with broad but often superficial marketing campaigns will instead turn their attention to creating engaging and highly personalized experiences to grow their first-party customer base.

Being compatible with the MSISDN (Mobile Subscriber Integrated Services Digital Number), the unique mobile number of each user, RCS allows mobile operators to verify the identity of the subscribers, making it easier to provide targeted and personalized messaging. Global MNO revenue from RCS is expected to reach $4.6 billion in 2026.

Kastanis, concludes: “It is time for mobile operators to capitalize on the developments in the digital advertising ecosystem and take a leading role in it. They are uniquely positioned to do so through their millions-strong subscriber-base and “owned” channels such as RCS and SMS. Using technology platforms that allow them to run multichannel campaigns effectively – and by the numbers – is a step towards this goal, and will help revenues soar in the coming years”.

Upstream is one of Google’s official messaging partners enabling RCS, and is recognized as one of the key players in the RCS ecosystem by the GSM. In Brazil, one of the leading RCS markets globally, Upstream is the biggest RCS sender.