Hugh McCartney, CEO at Cloudmark, investigates how consumers security concerns may be hampering their uptake of mobile operators value added services

Mobile data services deliver additional revenues for mobile operators worldwide, and as non-voice related revenues become an increasingly integral part of operators strategies, they must work to ensure that these revenues are protected and future proof. According to recent research carried out among consumers by Cloudmark, nearly two thirds cant manage a week without their mobile phone. But while this reliance on mobile phones bodes well for the industry, the adoption of mobile services such as mobile banking, mobile commerce and mobile marketing is by no means assured.

Trusted information
Consumers will only adopt these services only if they trust the information that they receive on their mobile device. In the advertising market, for example, the mobile device is seen by some as the most effective medium ever developed. The ubiquitous nature of mobile phones, which are always with us and normally always turned on, offers the promise of being able to send targeted advertisements based on behavioural preferences, usage patterns and location, wherever a consumer is and at any time of day. Mobile advertising will only fulfil its potential, however, if consumers trust the information they receive through what they perceive as a very personal channel of communication. If mobile spam and malicious attacks increase, consumers confidence in the security of their mobile phone will diminish, thereby jeopardising mobile operators future revenue streams.
Inevitably however, as SMS usage has exploded alongside increased use of the mobile Internet and diverse mobile applications, mobile users find themselves faced with new security threats on their mobile device. In Asia, 20-50% of all SMS traffic is currently unwanted spam, and while figures are lower in the UK and Europe they are still significant.
Recent research Cloudmark carried out among consumers found that 66% have received unwanted or unsolicited messages (spam) on their mobile phone, and while a majority of spam messages could simply be seen as a nuisance (e.g. SMS marketing), an alarming 29% had received malicious spam such as phishing messages, fraud messages or messages containing inappropriate content.
The research shows that these mobile threats are not only intrusive and annoying, they are felt to put consumers at risk of fraud and identity theft, and are subsequently eroding their confidence in the security of their mobile phone and the services they access on it. Half the consumers surveyed dont think the information they send on their phone is secure, while more than two thirds said they wouldnt use value-added services such as mobile banking and 37% wouldnt shop online due to mobile security concerns. In addition, it is clear that the consequence of letting spam proliferate can be hugely damaging to brands reputations, as well as contributing to customer churn and a rise in customer complaint calls. The increase in spam, in particular, is also putting pressure on operators networks, and negatively impacting customers quality of service.

Future growth
These combined factors are threatening the future growth of operators revenue from mobile data services, and just as email spam has impacted the success of online marketing, mobile campaigns will also lose out unless operators form an effective security strategy to protect their networks. The mobile industry needs to take notice of the threat that mobile messaging abuse and fraud poses to both consumers and operator revenues. Only by investing in the necessary technology to safeguard operator networks will customers feel confident using their mobile phones, and take full advantage of additional revenue-generating services.