Tech City UK Blog

Communications are evolving at an exponential rate. WhatsApp processes 30 billion messages daily. How can startups effectively tap into this massive communications opportunity with limited resources? We hear from Nexmo‘s Roland Selmer


To start, let’s look at a few drivers of this evolution:  


The API Economy
Only a decade ago, an API (Application Programming Interface) was an obscure computer science term. Today, APIs are fuelling the growth of Software-As-A-Service companies (SaaS) as their primary value proposition. In fact, Forbes estimates that over half of’s $2.3 billion revenue is generated through APIs.


Mobile-First World

During the era, the Web was the product. The catalysts of this ‘new economy’ were the early eCommerce websites. In today’s world, these transactions have migrated onto mobile devices, and with many businesses adopting a mobile first strategy, desktop has taken a supporting role. To give a concept of the impact of the app store, Apple has paid iOS developers more than $4 billion since it opened on July 10, 2008.


Cloud Computing

The emergence of the API economy was a byproduct of an infrastructure shift into the cloud. The scalability and performance required to process the ever-expanding volumes of web traffic could only be achieved through the distributed nature of cloud platforms. Cloud computing allows startups to scale the service capacity of their products without the cost of ownership and management overhead of costly hardware.


The “Social Network” Effect on Communication

The final piece in the puzzle is the role of social networks. Traditional communications such as dialled telephone calls, faxes, email and even the relatively modern SMS all typically use closed, proprietary networks. Today, people segregate their communications not by telephone numbers but by network and contextual relevance (e.g. friends on Facebook and colleagues on LinkedIn).


One area that combines all four trends – cloud, APIs, mobile and social networks – is cloud communications. Here are some practical use cases for how cloud comms can help solve common business-critical issues for startups:


Verifying Registration Identity

Many applications e.g. taxi sharing apps, chat and messaging apps, restaurant payment apps, and more, require users to enter their phone number to register. Why phone numbers? Well, a phone number is globally unique and has inherent built-in security. To get a phone number, a user typically needs to show some form of ID, provide their a billing address etc. A process called two factor authentication involves generating a PIN, sending a SMS to the number, and having the customer respond with the received PIN, which effectively and securely authenticates an app user.  


Customer-to-Customer Communications

Most marketplace businesses such as classifieds, dating, and auctioning websites/apps require communication between users. For commercial and safety reasons, these customer-to-customer communication conversations need to remain on the platform and often need to be anonymised to protect the identities of the parties involved.  


Service-to-Customer Communications

To deliver a better customer experience, applications or web services need to be able to directly communicate with their customers. This outreach can be in the form of a SMS updating a customer with the latest delivery estimates of a package, or an inbound or outbound voice call with a customer care agent.


Contextual Communications

The final use case and one that is becoming ever more relevant, is the concept of contextual communications. Contextually aware APIs take advantage of the context already embedded within the application. For example, in a mobile banking app, a user has already authenticated and chosen the account would like to talk about. If they tap the in app ‘Call’ button, the bank knows exactly who they’re talking to, and what issue the user is trying to solve. In contrast, if the customer called a generic help line, they would need to navigate a call centre phone menu, complete an authentication process, be handed off to the correct department, and then endure a lengthy customer support call. Not only is this resource intensive, but it will seriously compromise the overall customer experience.  


While cloud communications can be complex, cloud communications platforms like Nexmo take all the heavy lifting out of creating compelling customer communications experiences. And now, to make it even easier for startups to get started, Nexmo is launching a dedicated package for all startups accepted on accredited incubator, which will provide complimentary access to our robust cloud communications APIs for a year.


We can’t wait to see what you build!


To learn more, click here.