Did you know that “naughty” texting (also known as “sexting”) has changed the way we flirt? Or that the idea of instant messaging was invented while eating a pizza? These are two of ten astounding facts about the humble SMS whose technology has remained pretty much the same for the past 20 years.
But what has changed about instant messaging is the competition it faces in the form of free third-party social messaging apps like Skype Chat, WhatsApp, MSN Chat, Google Chat, Facebook Chat, and Blackberry Messenger. Not surprisingly, free apps mean bad news for service providers keeping an eye on their profit margins: according to analyst firm Ovum, social messaging apps cost mobile network operators $13.9 billion in lost SMS revenue in 2011 and it’s a trend that’s expected to continue.
Industry analysts suggest that service providers could offset potential future losses by rethinking their SMS plans. For example, last August AT&T ditched its 1,000-message plan at $10 per month, in favor of an unlimited plan for $20 per month (and users who don’t want a plan can pay 20 cents per SMS). Service providers could also partner with third-party app developers, particularly those who control the most popular social messaging apps, and cooperate amongst themselves to take on the challenge from major Internet players. But for now, they can take comfort in the fact that there may still be a market for the simple SMS for people who still aren’t using mobile broadband, or who like their privacy.
At the end of the day, the danger to future SMS-generated revenue may not be as bad as the research suggests. “I think it’s a growing threat which is manageable through the right tariffs and the right costing,” explains James Barford, a mobile analyst for Enders. Barford also pointed out that social messaging still only represents a tiny part of overall mobile communication, and according to a You Gov survey, the majority of smartphone users – 81% – still view SMS as the preferred way to send messages on a mobile.
I can’t help wondering how many of those are “sexting”.
BLOGGER: GAYLE RINOT