New TRAI SMS Regulations Affecting Small Businesses

The new TRAI regulations governing SMS’s in the country made people sigh in relief everywhere. Gone were those days of pesky SMS’s intruding people’s life at the most unusual of times with inane advertising from companies like Dr. Batra’s Hair Clinic, whose bulk SMS’s were bordering on spam.

But the big picture is not so simple. TRAI might have announced the regulations with curbing spam in mind but the fallout has reached to a whole different area. The business of Bulk SMSs was a booming one before the regulations were put into effect. Earlier a commercial SMS would cost 2 paise and now with a termination fee of 5 paise being levied on an individual SMS the cost has gone up to 7 paise.

Small businesses that were growing rapidly due to this simple way of advertising have now recorded almost 50% dips in business. When you think of it, although bulk SMS’s from unwanted people might be a bad idea, what about the people who want it? SMS chat services like WAY2SMS and SMS GupShup have also been affected significantly due to this rule.

How about notification SMSs from from e-commerce services like Flipkart? The rules require that sender ID has to be changed from IDs like TM-FLIPKART, LM-MEGASALE, etc.  be replaced by alpha-numeric code like TX-655100 or DZ- 567152. This will have an adverse effect on brand visibility. The bulk SMS medium has been the most cheapest and cost-effective way of advertising brands and events. The timing aspect of the regulations is probably the best feature.

Arun T Kurup, operation manager of leading bulk SMS provider MistAllianz said, “Small and medium business groups relied on bulk SMS services as it was cheap. I agree that promotional SMSs had a pesky nature. But these kind of strict regulations will cause much loss to the cheapest form of advertising. TRAI regulations would also not be effective in checking spams. Spams are still being sent by operating through international servers”.

Whatever the case might be, no consumer is complaining about the new regulations. They are perfectly happy with it. This signals that a fundamental shift in marketing and advertising is around the corner. The TRAI regulation has brought with it a lot of uncertainly for small and medium businesses and brands who cannot afford mainline advertising.

How will they overcome it? Could they turn to Social media for their marketing and advertising needs?

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