As SMS spam proliferate, CSPs must take steps to address the problem

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As SMS spam and fraud proliferate, Communications Service Providers must take steps to address the problem

If, like many, you have the impression that your customers are swimming in a sea of SMS spam, your perception is accurate. Unfortunately. According to research firm Statista (1), in the twelve months between October 2020 and September 2021, the volume of SMS spam globally increased by around 36%. In a single month, July last year alone, over 336 billion spam messages accumulated.

While the problem is global, with the US leading the way, digging into the nature of the problem more locally yields representative insights. For example, in Europe, the UK telecoms regulator OFCOM (2) provides an understanding of the landscape. It says more than 82% of mobile users claim to have received a suspicious message. That’s roughly 44.6 million adults in the UK. Around half of those are receiving an SMS spam message at least once every week.

And while it may appear somewhat encouraging that more than half of those SMS spam recipients either delete the message (53%) or block the number (52%) OFCOM nevertheless reports that around 2% of recipients following the scammers’ instructions in a message or call. That’s around a million consumers in the UK alone risking financial loss (and worse) if the scam attempt is successful.

If those numbers are representative, it suggests there may be as many as 10 million people at risk in Europe and 100 million worldwide. The assumption that they are seems reasonable. Reportedly (3), in the US spam texts increased by 55% in 2021, costing Americans $86 million. The FCC received roughly 14,000 complaints, up 146% from the year before.

If the sheer number of instances documented above doesn’t make the scale of the problem clear, the financial numbers do. According to The Harris Poll (4), in the year up to June 2021, American consumers alone lost $29.8 billion to scam calls. The FTC (5) states “the phone is still the top way that scammers are reaching us — both through phone calls and text messages. In fact, there was a sharp increase in the number of reports saying that scammers contacted them by text message.”

SMS Fraud can be Countered

If the scale of the problem is extensive, what to do? Clearly, failing to take steps to combat spam and, in particular, spam-driven SMS fraud isn’t an option.

Part of the challenge in acting is that SMS spam comes in a variety of flavours all of which need to be identified. Texts range from “You’ve won” (a competition that you didn’t enter) to “the tax office is trying to contact you” (they’re not) to “you have a refund coming” (so please supply your bank details) to the increasingly popular “a family member needs help. Please wire money immediately” (tempting as it may be, don’t!). And many more.

Such fraudulent SMS messages can, however, be countered. One way to do so involves using network probes (commonly part of a Network Management System) to collect signalling information and then using the resulting data to build a comprehensive overview of the SMS traffic that can be tailored to identify fraudulent profiles and generate fraud alerts.

The Cost of Inaction can Run to Billions

Considering the numbers in play, actively countering SMS spam fraud seems like a small step (and a small investment) for Communications Service Providers to take. And the numbers underline the need. The CFCA (6) estimates that among major carriers, AT&T’s $171.8 billion annual revenue in 2020 likely means a potential revenue loss of $3.1 billion to fraud. Telefonica Group’s $49.2 billion annual revenue in the same period equates to a possible loss of $915 million to fraudsters. For Vodafone Group, the potential fraud loss is $930 million. While these numbers are, of course, estimated, “spam and scam” itself is harsh reality. For mobile network operators, failing to take measures to combat spam-led fraud isn’t a viable option.

At Utel (7), designing and implementing technology solutions to the problem of spam-generated fraud (within the network itself) is an area of expertise. If you’d like to discuss steps you can quickly take to combat this significant issue, please get in touch.

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