SMS isn't going away, but looks to have peaked. That hits carriers in the pocketbook.
SMS messages are used year-round, but usage tends to spike during holidays. Finland's largest carrier, Sonera, recorded a 22% decline in texting on Christmas Eve in 2011 versus the same night in 2010. It isn't that people are communicating less. They are just using more modern methods of communicating.
Text messaging was conceived of in the early 1980s but it was 1992 before the first text message was sent over a phone network. The service became extremely popular over the years, especially among teens, who developed a language just for texting. Its usage has probably peaked though.
Hong Kong saw a similar decrease on Christmas, dropping 14% from the same day in 2010. There are no stats yet available for 2011 Christmastime SMS trends in the United States, but if it wasn't down last month, it surely will be over the next few years.
People are moving towards IP-based communication methods that have many of the advantages of SMS without some of the limitations. SMS messages are limited to 160 characters, plus it isn't unheard of for a message to get lost or delayed for hours. IP messaging eliminates both issues.
Groupme is a popular app on various smartphone platforms that allows you to set up groups, even a group of just two people. It allows you to chat simultaneously across multiple platforms. Blackberry, Apple iOS, Android, and Windows Phone all have a native app. The beauty of Groupme is you can still communicate with people that don't have one of those platforms. Each group you create is assigned a phone number, for free, that you can text to. With that number, friends with their old school feature phones can still be part of your conversation.
The major phone platforms also have their own IP-based messaging that users are increasingly switching to. Windows Phone 7 users can drift between SMS, Messenger, and Facebook Chat depending on what system their partner is on. iOS users are using iMessage, and Blackberry users have been using BBM for years.
Another advantage of these IP systems is they are virtually free. They use minimal data so even those with the most meager of data allowances won't consume a material part of their monthly allotment by messaging this way, and won't use any of it over Wi-Fi. SMS messages still cost money though.
Most people that text a lot buy a bundle of messages. AT&T, Sprint, and Verizon all have a $20 per month unlimited messaging plan. Without the plans, you will generally get charged 20 cents for each message. Unless you are still heavily into texting, the price per message may be the better deal.
SMS will still be around for years to come as it is a quick and cheap way to get various alerts, but as more users get comfortable with IP systems, especially those that are cross-platform, expect texting to steadily decline. That is something that can hit the carriers where it hurts--the pocketbook.
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