the third generation of mobile voice recording smart guide

Introducing the 3rd generation of mobile voice recording

smart guide Introducing the 3rd generation of mobile voice recording. 3

Introduction 3

An evolving market from niche to mainstream 4

Evolving customer demands 5

Requirements overview 6

Summary 13

About Resilient plc 14

Contents


Introduction

Selecting the best mobile voice recording solution for your organisation is becoming increasingly important since, due to changes in legislation and best practice, the number of staff who will need to have their calls recorded is due to increase significantly. As we outline in this document, in the financial services sector alone, the number of individuals who need to have their mobile calls recorded is likely to grow from around 30,000 users today to as many as 1.1 individuals. Identifying solutions for the relatively niche market of 30,000 users is significantly different from a solution to address a mainstream market of over 1m users. As such, organisations should consider not only their short-term requirements when selecting a

solution for mobile voice recording, but also how these requirements may change as the adoption of mobile voice recording becomes more mainstream.

This eBook outlines the market drivers that are fuelling this increase in demand for mobile voice recording, and then identifies the 15 characteristics of a 3rd generation solution to these requirements. It also provides a summary matrix which compares the capabilities of smartnumbers mobile against the 1st and 2nd generation of mobile voice recording solutions.

In January 2016, Ovum, the largest and most authoritative technology analyst company in the UK, completed a detailed and independent review of smartnumbers mobile by concluding that it represented the first solution in what they have termed the ‘3rd generation of mobile voice recording’.

According to Ovum, smartnumbers mobile not only addresses all of the shortcomings of current solutions on the market – comprised of what they term 1st and 2nd Generation services – but also adds significant additional business value that isn’t capable of being achieved with these earlier solutions.


Today, the FCA mandates that anyone directly involved in equity trading needs to have their mobile calls recorded. This is a fairly niche market of around 30,000 people in the City of London, who pay between £50 - £150 per month, including roaming charges, to have their mobile calls recorded. It’s a well-served market by 1st and 2nd generation solutions.

In January 2018, the European directive MiFID II will come into force, which will expand the mandate for mobile call recording to anyone in Financial Services involved in giving advice that may lead up to a trade. This will include IFA’s, relationship managers and wealth managers as well as those involved in commodity trading. Together, these increase the market for mobile voice recording in the UK to an expected 500,000 people.

In parallel, banks are reviewing the impact of the PPI mis-selling which has cost them £30bn in compensation payments. The banks lost the support of the FCA by being unable to prove they didn’t mis-sell PPI. As such banks are looking to ensure all customer engagement,

via online, phone and mobile communication, is recorded for dispute resolution. Many of the largest retail banks are today exploring solutions to record the mobile phone calls of all their staff, be these in branches, contact-centres or business centres. This increases the market for mobile voice recording by another 700,000 people to a total market within the financial sector of 1.2m.

Similar growth is also expected in other sectors, including legal, pharmaceutical and retail sectors where dispute resolution is becoming increasingly important for managing revenue and reputation. As this market changes from being niche to more mainstream, the customer requirements will also evolve. The following pages outline the nature of these evolving requirements and how a 3rd generation mobile voice recording service addresses these requirements.

An evolving market from niche to mainstreamThe market for mobile voice recording is poised for substantial growth, due to changes in regulation and best practice.


Evolving customer demandsAs the market increases 40 fold from 30,000 to 1.2m people, any solution for mobile voice recording must reflect the changes in both capabilities and commercials to support the demand of this expanding market.

While it may be acceptable to pay up to £150 per month to have the mobile phone calls of the top city traders recorded, this is not a price-point that can be considered for a solution for the masses.

Furthermore, the requirements of a solution to addresses this broader market is not simply limited to price –there are many other factors that come into play when taking a requirement for a niche and specialist market into something that is much broader, as outlined in this eBook.

Resilient plc have over 300 major financial services firms using their smartnumber services, in addition to 2,000 customers in other sectors. Within the financial sector, customers includes eight of the Top 10 global investment banks, all UK retail banks and many wealth managers, IFA’s, hedge funds and other specialist service providers. In other sectors, our customers include major defence organisations, retailers, law and pharmaceutical companies.

In order to understand the requirements for the next generation of mobile voice recording we undertook detailed requirements capture from our customers, as well from regulators, such as the Financial Conduct Authority and industry analysts such as Ovum.

As a result of this research, a common set of requirements for the next-generation of mobile voice recording services has emerged. These are outlined in the following pages:


Requirements overviewIn order to design the next generation of mobile call recording services we engaged very closely with our customers to create a requirements checklist, incorporating each of the key elements that they have used to select a mobile voice recording solution. This has enabled us to come up with the following fifteen key requirements that are common across businesses both large and small.

While it should go without saying that any solution for Mobile Voice Recording needs to ensure that an organisation can achieve compliance, there are in fact a number of UK/European regulations that organisations are required to meet – and companies do not get to pick and choose which they will and will not adhere to.

The requirements to meet the current FCA (COBS 11.8) mandate is well understood by the UK financial services market. However, these requirements will soon be overtaken by the MiFID II requirements that not only broaden the number of individuals that will be covered by call recording regulation, but will also change the scope. For example, under FCA COBS 11.8 the organisation needs to retain call records for 6 months, while under MiFID II this will be expanded to 60.

Furthermore, since many financial services companies using PIN-code verification of a customer prior to any conversation, or to transact on the telephone, then mobile voice recording would also fall under PCI/DSS regulations which prohibits the recording of dial-tones associated with bank card verification.

Finally, there are also competing regulations, such as Article 8 of the 1998 UK Human Rights Act, which states that it is illegal in the EU for companies to record personal conversations, which presents a challenge of how to ensure that while business conversations are recorded, personal conversations remain private.

Requirement 1

Compliant


Requirements overview (continued)

As the market becomes mainstream, it becomes increasingly important that any solution is simple to implement. Many of the organisations that will be required to record calls under MiFID Il, such as Independent Financial Advisors, may have little or no dedicated IT support. Therefore the implementation of any mobile voice recording solution needs to be simple and easy - while being robust and reliable.

Requirement 3

Simple to Implement

The current FCA requirements for call recording have been in place since 2011 and since that time a number of earlier generation approaches have been tried and tested with various degrees of success.

The first generation of solutions were based upon software clients that could be switched off, or bypassed. They usually relied upon tromboning of calls between the mobile handset and a fixed-line call recording solution. This creates a delay in setting up calls and may result in call echo which doesn’t provide a good user experience.

The second generation addressed many of these problems by enabling call recording within the mobile network itself. With this approach, call recording is achieved within the call-flow so the user cannot interrupt or bypass it. Additional benefits are that network-based voice recording doesn’t impact call setup, call quality or the user experience.

Requirement 4

Network Based

While it may be acceptable to pay over £100 per month to have the mobile phone conversations of the top city traders recorded, this isn’t a price point that will be acceptable to the larger mainstream market. As the market moves from niche to mainstream, businesses should expect the market price for call recording to fall to a £10 - £20 per month premium over their existing monthly mobile spend.

Requirement 2

Affordable



Regulations dictate that all communications between financial services companies and their clients – including telephone calls, SMS and other communication media such as instant messaging and email. Within the scope of mobile voice recording it is therefore essential to record both calls and SMS from the mobile phone of the regulated user. For 1st and 2nd generation solutions, while they may have been able to record calls, many have found it difficult or impossible to record SMS messages.

Requirement 6

Records both Calls & SMS

While we all expect our telephone calls to operate when we travel overseas, it’s equally important that for regulated conversations the mobile voice recording works internationally too. However, this presents a number of technical challenges, since when roaming internationally, the voice path usually don’t route via the home country, with CAMEL ensuring call hand-off in-country. This makes it very challenging to guarantee that services which sit in this voice path, such as call recording, will always make it back to the UK for recording and compliance purposes.

This is a common short-coming of the 2nd generation of mobile voice recording, as many solutions will work when the subscriber is in the UK, but cannot be guaranteed to work if the subscriber is travelling internationally.

Requirement 5

Works in the UK and Internationally

When mandating a solution for the city traders that require call recording today, it’s usual for organisations to provide company-issued mobile devices for business use only. However, as the market expands, and organisations take different approaches to mobility, then any solution for call recording needs to work with mobility strategies including Bring-Your-Own-Device (BYOD), Corporate-Owned-Business-Only (COBO), Corporate-Owned-Personally-Enabled (COPE), Bring-Your-Own-SIM (BYOS) and variations of these.

In addition, and by implication therefore, any solution for mobile voice recording also needs to work within the mobile device management (MDM) framework that organisations adopt to manage corporate-provided and personal-provided devices.

Requirement 7

Support alternative mobility strategies



Although organisations will often spend significant amounts to comply with mobile voice recording regulation, many see limited benefit of this investment to the organisation itself. One of the ways in which the business can benefit their investment in mobile voice recording is through integration with the corporate CRM system.

With this approach, every call between the regulated organisation and their customers is automatically recorded in CRM, so that the complete 360º view of the customer is maintained and the efficiency and productivity of their front-line staff can be measured. In some cases, such as with Salesforce.com, the organisation may also drill-down into customer recorded to retrieve and play the recorded conversations for training and quality purposes. As such, an expenditure on compliance can quickly become a real asset to the organisation as they grow their customer relationship function and capabilities.

Requirement 8

Support for CRM

While there are an increasing number of regulations that will mandate the need to record business conversations, there are other regulations, such as Article 8 of the European Convention on Human Rights that expressly prohibit organisations from recording personal calls.

Therefore, any solution for mobile call recording needs to ensure that regulated calls are recorded for compliance while personal calls remain private. In the past this was achieved by providing staff with a second mobile phone for business use. However, technology has now overtaken this and a growing number of ‘dual persona’ solutions now exist that provide separate business and personal communications on one device – ensuring that while business calls are recorded, personal calls remain private.

Requirement 9

Record business calls but not personal calls



Under MiFID II, the requirement to store regulated conversations increases from the six months mandated today by the FCA, to a minimum of five years. This is a substantial increase in the time required to archive recordings, and in the capabilities of solutions capable of managing and retrieving such recordings. A number of financial service companies will already have solutions in place to record their fixed-line conversations and would look to use this investment to manage their mobile voice recordings. In this way, an organisation could manage all their fixed and mobile call recordings in one software suite, with word search, speech analytics and other discovery tools working across both fixed and mobile call recordings.

Requirement 10

Support fixed-line solutions for storage & retrieval

With the dramatic reduction in cloud storage costs, and the increasing number of tools that are available for cloud-based discovery and analytics, more financial services organisations are looking for a 100% cloud-based solution for the storage and retrieval of call recordings. Furthermore, as it becomes clear that organisations such as the UK Ministry of Defence are starting to use cloud-based services for critical organisational requirements, it is clear that concerns about security and reliability have been addressed.

However, different cloud vendors focus on different markets, with the likes of Symantec, AWS, Bloomberg Vault and others addressing different segments of the market with different capabilities – and price-points. Furthermore, some of these solutions will host recordings in the UK and others in Europe while some base their archive and storage facilities in the US. It’s therefore important that any solution for mobile call recording provides a choice of cloud-based storage and retrieval options so that the organisation can choose, based upon their budget, requirements and regulatory constraints, the right solution for them.

Requirement 11

Support cloud-based solutions for storage & retrieval



Many of the 1st generation mobile voice recording services were based upon a separate client on the phone, usually using IP voice, and using the internet to carry and record these calls. However, while VoIP may be acceptable for inter-company calls, where quality and reliability may not be as important as with client calls, the technology and requirement for high-quality, consistent data access renders it unsuitable for use within this regulatory and compliance market.

2nd generation of solutions, being network-based, overcame this shortcoming by ensuring that all calls used GSM so that regulated conversations could take place anywhere with a mobile signal.

3rd generation mobile voice recording enables call recording on both GSM and VoIP calls so if the subscriber is in an area served only by the GSM network, then conversations may take place over GSM. However, if the subscriber is overseas and wishes to eliminate international roaming charges, or they are working in an area with poor mobile network coverage, so long as there is a good wifi access they can choose to use a VoIP client and still have their calls recorded.

Requirement 12

Uses the GSM network for reliable call quality

The 2nd generation network-based solutions for mobile voice recording operated by requiring customers to replace their existing SIM card with a specialist SIM card that provided, at a significant premium, mobile voice recording. Not only were these recorded calls charged at a premium, but in fact all calls were charged at a premium, even if only a handful of these need to be recorded.

Furthermore, by splitting off these regulated users to a separate network agreement often impacts the corporate mobile contracts and the ability to meet corporate spend commitments – increasing the mobile costs still further. While this approach may be acceptable for the very top tier of the market, it’s not a solution that will prove acceptable for the mainstream. Instead, mobile call recording as service should work across all UK network operators, using the SIM that is already in the phone.

Requirement 13

Works across all network providers



Many of the 1st Generation of mobile voice recording solutions require a client to be running on the user’s phone, and as such work only on a small number of handsets. Some solutions will work only with Blackberry devices, others will work only on Android.

Any 3rd generation solution for mobile call recording, especially if serving a large enterprise estate needs to work on any smartphone that may be present in this estate – be it iOS, Android or Windows phone.

It is usually the case that the subscriber’s business mobile number is already in the public domain – on business cards, website, marketing literature or stored within the contact directory of their customers. Therefore it’s essential that any solution for mobile voice recording does not require the customer to change their mobile numbers, and that instead the solution can be deployed using existing mobile numbers.

Requirement 14

Works across all mobile handsets

Requirement 15

Number Retention


SummaryThe following are the requirements of the mainstream market which constitutes the 3rd generation of mobile voice recording;

? = Some vendors may, others will not, meet this requirement

Requirement Description1st Generation App-Based

2nd Generation Network Based

3rd Generation smartnumbers

1 Compliant to FCA, MiFID, PCI (DSS), UK Human Rights Act (2008) ? ? ✓

2 Affordable ? ✗ ✓

3 Simple to Implement / Simple to Use ✗ ✓ ✓

4 Network Based ✗ ✓ ✓

5 Works in the UK and Internationally ? ? ✓

6 Records both calls and SMS ? ? ✓

7 Supports alternative mobility strategies ? ✗ ✓

8 Supports customer relationship management (CRM) ✗ ✗ ✓

9 Record business calls, not personal calls ? ✗ ✓

10 Support fixed-line solutions for storage & retrieval ? ? ✓

11 Support cloud-based solutions for storage & retrieval ? ? ✓

12 Uses the GSM network for reliable call quality ✗ ✓ ✓

13 Works across all network providers ✗ ✗ ✓

14 Works across all mobile handsets ✗ ✓ ✓

15 Enables the business to keep their mobile numbers ? ✓ ✓


About Resilient plcResilient are the people behind smartnumbers We are a pioneering provider of smart voice services that help the public and private sector improve organisational agility, resilience and compliance. Our team of industry thought-leaders are creating voice services which underpin business transformation, enabling our customers to operate more efficiently, securely and robustly.

Our Customers Our smartnumber services have been adopted by the leading organisations within the financial services, technology, defence and security sectors. More than 2,000 organisations today take their fixed and mobile voice services over the smartnumbers cloud in order to protect revenue and reputation and achieve regulatory compliance.

What We Do Our smartnumber services overlay both fixed and mobile networks enabling them to be deployed by organisations without changing their numbers, their network or their IT infrastructure. For fixed-line customers, we protect critical calls into the organisation, especially during disruptive events. For mobile estates, we enable mobile engagement to be driven by business rules, priorities and imperatives. Together, we combine fixed and mobile services to drive the benefits of Fixed & Mobile Convergence (FMC) to the heart of the organisation.


Find out moreTo find out more about the 3rd generation of mobile voice recording, call our sales team on 0203 3162 3030 or visit www.smartnumbers.com