SMS Text Messaging Declines - InformationWeek

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Commentary
1/5/2012
12:36 AM
Ed Hansberry
Ed Hansberry
Commentary
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SMS Text Messaging Declines

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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DaveG
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DaveG,
User Rank: Apprentice
6/19/2012 | 1:46:18 PM
re: SMS Text Messaging Declines
SMS makes up 15% of an MNO's revenue on average. It costs them very little so the margins are huge. The "big whoop" is that the "OverTheTop" IM services will increasingly eat into that revenue stream. Ask any South African MNO; they've had to contend with the likes of Mxit for the past 8 years or so.
EVVJSK
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EVVJSK,
User Rank: Apprentice
1/11/2012 | 3:30:47 PM
re: SMS Text Messaging Declines
I do what I can do keep phone calls and SMS use to a minimum, because of end user costs that are not in line with Operator Costs. I do not have an unlimited SMS plan. Some months I send 10 - 15 texts, others 3 or 4. If I could get 50 texts for about $2, I would sign up for that plan (and if I didn't use it would be gravy for my carrier), but they want too much money for too few texts. As people chose the extra cost of data plans, I think SMS may continue to decline. Can't say I will be sorry to see that. Maybe carriers will get a clue.
My 2c
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My 2c,
User Rank: Apprentice
1/6/2012 | 11:17:53 PM
re: SMS Text Messaging Declines
Do the math, 5.3 Billion mobile phones do primarily 2 things 1) SMS & 2) Voice. There are only 83 Million iPhones sold to date (bet you have ore than 1) that is less than 1,5% etc, etc. SMS will be here for a while the same way credit cards has not replaced cash and Skype has not replaced phones by a long shot; by the way it ain't bad we all use SMS every day, in fact SMS is the #1 app on ALL smart phones and even iMessage use SMS on the back-end to reach the other 98.5 % of mobile phones on the planet. Yes, SMS is the Gorilla in the room last time anyone checked. Same math only worst statistics go for BBM, etc.
Leo Regulus
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Leo Regulus,
User Rank: Apprentice
1/6/2012 | 5:59:42 PM
re: SMS Text Messaging Declines
" That is something that can hit the carriers where it hurts--the pocketbook." Gee, why am I not crying? Correct me if I'm wrong, but isn't SMS capability on the part of providers something like horse manure? I mean, it's something that just happens to be there as a result of their other activities. It doesn't actually cost them anything so why the big whoop?

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