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Logica bites IP bullet for next generation SMS centres

Faced with a need to carry bits of data for far less money than the original SMS price structure guaranteed, market leaders Logica and CMG have merged, and are now looking to Internet protocols to cut costs for phone operators.

Between the two of them, Logica and CMG, before their merger, were reckoned to have 80% of the market for SMS centre hardware, or SMSCs - and they were highly complex, very expensive bits of gear.

But phone carriers are now looking to deal with SMS traffic that has nothing to do with person to person flirting. They hope to do deals with "media owners" who will distribute data - images, sounds and video - over the phone network; and who will generate interactive traffic in return. Current hardware is not optimised for this traffic, and can't carry it cheaply.

What LogicaCMG will announce at Cannes on February 18th is a new generation of SMSCs built around the Internet Protocol(IP) as well as the current SMS protocol. The machines haven't even got a name, yet; they're being called "The New Architecture" or "The Upgrade" internally - and no doubt will get a fancier title when the marketing department decides to publicise them.

The other thing that LogicaCMG will be talking about, a lot, at Cannes 3GSM Congress, will be Multimedia Messaging Services, MMS - and MMS billing problems.

The threat to LogicaCMG revenues is the old question of SMS versus MMS versus GPRS. Logica reckons it has an answer to this with the new generation of hardware, plus some new software to handle interoperability between various phone networks on MMS. But it is fighting off competition from new companies, which are building their systems around ordinary Intel-based and Sun based Unix machines.

Full details will be released at Cannes.