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					Pronto Premium SMS Service Gateway
For Public Wi-Fi Access


The Pronto Premium SMS Service Gateway enables mobile operat ors to generate additional
revenue by offering a new Premium SMS service for Wi-Fi access. Simply put, Pronto’s Premium
SMS Service Gateway enables mobile phone users to pay for Wi-Fi access using their mobile
phone. Users enter a 5-digit Short Code, then shortly receive an authorization code which they
can enter on their laptop or P DA in order to get wireless access at a public location, such as an
airport, hotel or café. The Pronto Premium SMS Service Gateway is a standalone system that is
interoperable with third party messaging and OSS systems. It can also be used as an add -on
module with Pronto’s leading Operations Support System for Broadband Wireless Networks.


Due to the widespread uptake of SMS, ‘premium SMS’ is emerging as the next growth area in
messaging. Premium SMS enables subscribers to use their mobile phones to make
micropayments for either special added-servic es or content. Using one’s mobile phone for
micropayments – or amounts that are only $1-2 in nature – is oft en an attractive option for the
user, as risks associated with using a credit card over the Internet are eliminated. The user also
benefits from SMS’ ease of use and the convenience of receiving a single bill from his/her service

Operators now have an opport unity to leverage their installed based of mobile users to generate
additional income via premium SMS. According to the analyst firm The Shosteck Group, the
average premium text message could generate as much as 6 to 10 times the revenue of a
standard text message. If operators have sensible revenue-sharing agreements with service
and/or content providers, premium SMS services could potentially turn into a lucrative business.
In a June 2003 study, The Shosteck Group projects that premium SMS will account for about
12% of non-voice service revenue by 2007, particularly for mobile operators in Europe and Asia
where SMS is used broadly in the consumer market.

Given the widespread adoption of Wi-Fi and growing number of public hotspots, offering Premium
SMS for public Wi-Fi access can be a significant new revenue opportunity. Many mobile users
often have the need to check their email or download information from their corporate LANs while
on the road. Premium SMS for Wi-Fi enables these mobile users to easily and quickly gain
Internet access by simply entering a 5-digit code on their mobile phones at Premium SMS-
enabled locations. No account signup is required. Billing is consolidated on users’ mobile phone
bill, eliminating the hassles of entering credit card information or purchasing a pre-paid card.


Pronto Networks has developed a Premium SMS Service Gateway (PSSG) that enables
operators to offer and charge for public Wi-Fi access for a specified period of time to their
subscribers. The PSSG is a critical network element for verifying short codes as well as
generating and validating authorization codes that enable Wi-Fi access. Pronto’s PSSG can be
used as a standalone product or in conjunction with Pronto’s leading Operations Support System
(OSS) for Broadband Wireless Networks.

How It Works

From the end-user perspective, using Premium SMS to gain wireless Internet access at a
Premium SMS-enabled location is easy. The entire process is outlined in Figure 1. Steps are as

    1.   The user enters a 5-digit Short Code into his/her mobile phone and sends an SMS
         request to a Messaging Service Provider via the user’s carrier.
   2.   The PSSG receives the new Short Code from the Messaging Service Provider and
        verifies it against a list of pre-authorized short codes. The PSSG then generates an
        alphanumeric authorization code that is sent back to the Messaging Service Provider.
        The PSSG stores the authorization code for that user in a local repository.

   3.   The Messaging Service Provider forwards the aut hentication code to the us er’s mobile

   4.   The user enters the authorization code in the appropriate field on their laptop or PDA.

   5.   The authorization code is then forwarded to a Pronto Hotspot Controller or other
        compatible WLAN equipment.

   6.   The authorization code is verified by the Pronto OSS application.

   7.   The user is allowed access out to the Internet. The user is charged the transaction fee
        for Wi-Fi access.

Figure 1: Premium S MS Authentication and Authorization Process for Wi -Fi Services

System Capabilities

The PSSG performs multiple functions relating to processing Short Codes and authorization
codes for public Wi-Fi access. These functions are described below:
       Short Code S etup: the PSSG can be configured to handle any Short Code by the

       Authorization Code Generation: the PSSG generates an authorization code for every
        Short Code that it receives from the Messaging Service Provider. The Short Code,
        along with the us er’s mobile phone number, is deposited in a local repository.

       Flexible Configuration Options for Authorization Codes: the PSSG enables operators to
        configure certain parameters relating to the authorization code, such as length of code
        and any associated message.

       Authentication of Authorization Codes: the PSSG authenticates authorization codes
        sent to it by either the Pront o OSS or other back-end system.

       Detailed Log Generation: the PSSG logs information relating to the above activities,
        including details on calls rec eived, confirmation codes served, confirmation code
        successes/failures, and confirmation codes authenticated.

       Settlement Report Generation: the PSSG can provide a settlement report with CDRs to
        any OSS with session information and revenue received from the Messaging Service
        Provider for eac h session.

       Web Service API Support: the PSSG supports web service APIs for verifying the
        authorization code.


The PSSG comes with several ties into Pront o’s carrier-grade OSS. Specifically, the Pronto OSS
contains a Premium SMS Login Module that interfaces with the PSSG via web service APIs. In
this module, an administrator can quickly and aut omatically enable Premium SMS Wi -Fi services
for a hotspot operator’s locations. Figure 2 shows how an operator can provision a new Premium
SMS plan for a pre-det ermined amount of minutes.

Figure 2: Enabling Premium S MS for Wi-Fi Access via the Pronto S MS Login Module

The Pronto SMS Login Module is involved during the user authentication and aut horization
process. When a user enters the authorization code on her/his laptop of P DA, the Pronto Login
Module invokes a web service to the PSSG. The PSSG receives the authentication request and
records its origin as well as the entity that authenticates the request (in this case, the Pronto
OSS). The PSSG then returns an aut hentication success or failure along with the Short Code
and authorization code. The Pronto OSS proceeds to allow or disallow access to the user, as
appropriate. The Login Module enforces the business rules associated with the usage of each
Short Code, including:

       Tracking the period for which the Short Code is valid
       Determining the original and remaining number of minutes/bytes allowed
       Overriding the number of minutes/bytes for a specific location
       Enabling/disenabling Premium SMS usage at specified locations
       Allowing single or multiple connects per authorization code

After a subscriber is provisioned for the Premium SMS service, all session information is captured
in the Pronto OSS repository, including dat a on intermediate sessions. Access history detail is
available for customer support and potential settlement disputes.

The Pronto OSS also supports a number of settlement reports. The OSS has an interface to
import both rated and unrated CDRs from the Messaging Service Provider as well as CDRs from
the PSSG. The OSS has the ability to reconcile information from both sources and create
individual settlement reports for participating operators.

CAS E STUDY: 20 Minute s of Wi-Fi Access for $1.99 at U.S. Public Hotspots Using ‘80211’
Short Code

In August 2004, Pronto Net works launched a Premium SMS service in hundreds of hotspot
locations in the United States. The Premium SMS servic e allowed mobile phone subscribers of
major U.S. carriers to logon at any Pronto -enabled loc ation for 20 minut es by entering the ‘80211’
Short Code. Users were charged $1.99 per transaction, and all trans actions were posted directly
to the users’ mobile phone bill. Mobile operators included in the launch include Cingular, Nextel,
and ot hers.

To use the service, a mobile user would simply launc h their browser and immediat ely see the
Premium SMS service promot ed on the initial splash screen (see Figure 3). The splash screen
highlights the mobile operat ors participating in the service. After ent ering ‘80211’ on their mobile
phone, the user would receive an authorization code. The us er would enter this code on their
laptop or PDA and then gain access to the Internet for 20 minutes. The user would be charged
$1.99 for the Wi-Fi access on their mobile phone bill.

<Figure 3>

The revenue from the transaction is later settled and distributed among several parties. The
carrier that receives the $2.00 from the user typically keeps about 30% of the revenue and pays
the Messaging Service Provider the remaining amount. The carrier also pays applicable taxes to
the US government. The Message Service Provider keeps a small percent age of the total amount
as a transaction fee and distributes the remaining to the local operat or. In the end, the mobile
operator earns about $0. 60 on every Premium SMS transaction. The local operator earns
roughly $0.75.


With the widespread adoption of SMS text messaging among subscribers, especially in Europe
and Asia, and the growing popularity of Wi-Fi worldwide, operators now have an opport unity to
capitalize on these trends by offering a new premium service -- Premium SMS for Wi-Fi access.
With Pronto’s proven Premium SMS Service Gateway, mobile operators can quickly and
affordably launch a new service that will significantly boost Average Margin Per User (AMP U).
Pronto’s carrier-grade PSSG provides the back-office functionality required to enables these new

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