How QLC Chain Helps Montnets Group on 2 Billion Global SMS Billing and Clearance

QLC Team
QLC Team
Nov 14, 2018 · 7 min read

SMS text messaging continues to grow

In a digital age where applications such as WhatsApp, WeChat, and Facebook Messenger are overwhelmingly used for communications, to some, SMS messaging may be considered obsolete. Despite the growth in applications, SMS remains a primary form of communication as it has a proven efficiency, reaching users with a 90 percent read rate in minutes. With regards to timeliness of delivery, SMS maintains the highest engagement rate when compared to email and over-the-top (OTT) apps.

In term of generational use, the millennial demographic may not send and receive happy birthday and festival wishes via SMS at the same levels of older generations. However, millennials do use SMS messaging for verification codes, promotional codes, and invitation links. A study from Research and Markets says the SMS or Application to Person (A2P) market is expected to grow from US $44.12 billion in 2017, to US $60.55 billion by 2025, at a compound annual growth rate (CAGR) of 4.1% between 2018 and 2025. These figures are expected to be achieved by adoption in banking, travel, transport, retail, and healthcare industries.

QLC Chain has partnered with China’s leading cloud communication service provider, Montnets Group (Montnets), to develop an enterprise-level, global SMS business platform. Montnets has hundreds of thousands enterprise customers and strategic partnerships with leading companies such as Baidu, Tencent, Alibaba, Bank of China, Ping An Insurance Group, China Merchants Bank and more. Additionally, Montnets has long-term partnership’s with China’s top three telecommunications operators (telcos), China Mobile, China Telecom, and China Unicom.

By combining QLC Chain’s and Montnets’ resources, the blockchain-based platform will seek to promote and enable global SMS platform adoption at an enterprise-level scale.

SMS distribution business pain points

Entities in the global SMS distribution business include service providers (SPs), telcos, and Aggregators. In general, enterprise-level customers prefer to purchase global SMS packages from SPs, as opposed to directly dealing with telcos from different countries. However, third party SPs will deal with telcos, other SPs, aggregators, and cloud-based SPs for their product offerings. Within the SMS market are countless vendors that offer various specialties and a variety of focuses. Despite the variety of services available in the SMS market, there are long standing pain points that can be improved upon.

Firstly, the process of researching third party SPs and telcos, and connecting their services, is not highly efficient. Often times, middlemen will concurrently integrate SMS distribution services with the telcos gateway and connect two parties. These integrations are usually conducted in pairs, which means a SP will likely need to establish connections with as many SPs and telcos as possible. These connections are often established in a repetitive manner, though they will typically have different terms and cost models.

Secondly, despite decades of development, the SMS market is still relatively obscure. There isn’t a transparent market price for different types of partnerships, primarily because of the countless layers of intermediaries. Additionally, telco and SP resources can be monopolized in certain countries.

Thirdly, it is difficult to comprehensively measure the quality of a service-level agreement (SLA). Typically, SPs provide an SLA quality report that covers SP-to-SP transmission, as opposed to examining end-to-end service quality within the network.

To conclude, the transparency and trustworthiness of agreements made between service providers, telcos, and other related parties have been core pain points of the global SMS business model. Additionally, another pain point for global or domestic service is a credible end-to-end SMS service quality SLA test.

Blockchain technology is recognized as the solution for a trustless business relationship

Blockchain — essentially a distributed, digital ledger — has many applications and can be used for any exchange of goods or ownership, agreements/contracts, tracking, and payment. Blockchain can also be utilized to solve issues with transparency and trustworthiness, as every transaction is recorded on a block and across multiple copies of the ledger that are distributed over many nodes (or computers).

Blockchain technology has the capacity to create a trustless environment, which supports participation from multiple parties, and ensures transparency. Most importantly, as a publicly maintained ledger, the record is immutable and allows for fraud prevention. The features of blockchain technology are particularly suitable for the complex scenarios that can involve multiple SP and multiple telcos, particularly with regards to telecom network resource asset settlement.

A new generation of SMS channel digital asset platform based on blockchain technology can provide tremendous value to the traditional SMS trading and clearing models.

QLC Chain for global SMS trading, monitoring SLA quality, and clearance

QLC Chain uses its unique Multidimensional Block Lattice structure to support frequent transactions and various functions in the network industry, global SMS business, and to incorporate the SPs onto the blockchain.

QLC Chain’s blockchain aims to simplify busines execution by removing the redundant one-on-one connection pain point, and introducing a participatory SP marketplace.

Enterprise users can choose to adopt a developed application, or use an API, to utilize the QLC Chain peer-to-peer platform and connect to the SP Hub. It is the SP Hub that allows SPs from different countries with existing short message peer-to-peer (SMPP) services to build efficient connections. SPs will also serve as QLC Chain nodes, which are used to confirm and validate transactions, assist in the billing process, and acquire logs.

Working process for smart contract enabled SMS purchase agreements:

1. An SMS purchase agreement is agreed upon between “Service Provider A” and “Service Provider B,” and a joint smart contract-SMS purchase contract is issued.

2. “Service Provider A” calls the “SMS purchase contract” to generate the Send Block under the “Service Provider A” account, which contains the transaction amount and the SMPP request information. Afterwards, nodes in the QLC Chain network will verify the validity of the transaction, and the “SMS purchase contract” calls the “SendSMS” external interface.

3. “Service Provider B” determines that the short message has been sent successfully, and calls on the “SMS Purchase Contract” to generate the “Receive Block” under the “Service Provider B” account. Wihin the “Receive Block” is a certificate that validates the the successful contract, and all nodes will verify the validity of the transaction. At this point, the sending of the short message and the corresponding transaction process are completed.

4. The public chain platform will provide Oracle capability to support the above process.

QLC Chain and Multidimensional Block Lattice

QLC Chain has developed its Multidimensional Block Lattice structure to support frequent transactions and various functions in the network industry, and to enable a decentralized Network-as-a-Service (NaaS). Block Lattice maintains one blockchain for each account controlled by private keys of the respective accounts. These blockchains are then replicated to all the peers in the network. In these blockchains, it is only the balances that are tracked, not the transaction amount. Balance transfers are executed with the help of send and receive blocks. A send block reduces the balance and the delta is then marked to the recipient account. The recipient then creates a receive block which increases the balance.

QLC Chain uses the current Block Lattice structure, which does not require mining to reach consensus and results in zero transaction fees, and takes it a step further. By converting the single dimensional Block Lattice into a multidimensional structure, each account can handle multiple tokens as well as new tokens that are mapped to a new chain within the account. Since each token exists on a single chain (dimension), the entire structure with multiple tokens is called a Multidimensional Block Lattice Structure. This results in seemingly unlimited scalability, while improving security.

QL Chain Block Lattice Structure

During internal testing, QLC Chain was able to achieve 3,500 transactions per second (TPS). It is expected that Montnets’ annual SMS demand would require 2,000,000,000/365/24/60/60 = 63.4 TPS. At its current scale, QLC Chain’s Multidimensional Block Lattice structure offers the capability to support more than 55 businesses, at the scale of Montnets Group.

As the Multidimensional Block Lattice structure allows transactions to be handled independently of the main ledger, each transaction is an independent block that fits in a UDP datagram. Therefore, there won’t be any block size debates, as nodes simply store the current blocks of all account-chains, which also improves scalability. Taking Montnets Group’s business as an example, the current development calculation shows that annual 2 billion SMS would require 1.8 terabyte of storage.

The future

Global SMS business is just a starting point for decentralized network resources processes. Blockchain technology has intrinsic advantages of transparency, immutability, and trustlessness. This, coupled with the fractionalization of network resources, could aid the development of a fair and efficient market platform. And, over time gradually include expanded functions, such as mobile data, internet of things (IoT), and more.

QLC Chain

QLC Chain is the first public chain for decentralised network. The QLC Chain and supporting ecosystem will enable any individual, business or organization to leveraged the infrastructure and their mobile network resources to become a network service provider.

QLC Team

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QLC Team

The first public Chain for decentralized Network-as-a-Service! Visit our website at Twitter @QLCchain

QLC Chain

QLC Chain

QLC Chain is the first public chain for decentralised network. The QLC Chain and supporting ecosystem will enable any individual, business or organization to leveraged the infrastructure and their mobile network resources to become a network service provider.