Who said SMS was yesterday's messaging technology? The "Simple Messaging Service" that was originally designed as a tool to allow network engineers to communicate has become the personal messaging tool of choice. Experts and analysts have been forecasting it's demise for years, firstly with MMS then email and instant messaging over the new "fast" GPRS and 3G networks and now notification messaging via Smartphones. The problem with this is that it still relies on affordable and ubiquitous, fast 3G network connections to really be effective. SMS works on 2, 2.5 and 3G so is available almost everywhere (even where there's insufficient signal strength to maintain a sufficiently audible voice call). More importantly, SMS costs are predictable. You can't really claim it is inexpensive as, character for character sending an SMS to the house next door is more expensive than sending the same message via satellite communications to the moon. The attraction of SMS however is that the cost is predictable. Either the SMS is included in tariff bundles or it's 10p. Simple, as our furry friend from the TV ads might say.
In fact, according to Total Telecom and ABI Research, the number of SMS to be sent in 2011 will beat the 7 trillion barrier for the first time. An increasing number of these will be sent in a business context rather than personal one-to-one messages. This is the most interesting trend for anyone offering messaging services in the mobile domain.
It's not all good news for SMS though as predictions are that pricing will continue to commodotise further reducing margins for carriers. However, anyone offering value added services that utilise SMS as the communications transport should see their efficiencies increase as a result of lower wholesale SMS pricing. My personal experience suggests that commodotisation isn't filtering down to the street level though and during 2010 I actually witnessed prices in certain countries (stand up the Netherlands, guilty as accused) increase prices significantly as SMS bypassed regulation that was squeezing network operator revenues elsewhere, such as voice services.
With researches claiming between 4.2bn and 6bn active mobiles worldwide, it's obvious that at some point growth is set to slow down - soon everyone will have one, maybe two devices. Of course individuals will continue to upgrade to newer models constantly, so the manufacturers will be happy, but from a messaging point of view the number of participating users is surely close to its maximum by now. Again, value added services is where growth for service providers will come from - messaging including SMS is just a capability to enable a range of innovative products and services.
I think with the trend for unlimited 3G access in decline and Wifi growth seemingly stalling, I think the old GSM originated technologies such as SMS have a very long and fruitful life yet to come.
In fact, according to Total Telecom and ABI Research, the number of SMS to be sent in 2011 will beat the 7 trillion barrier for the first time. An increasing number of these will be sent in a business context rather than personal one-to-one messages. This is the most interesting trend for anyone offering messaging services in the mobile domain.
It's not all good news for SMS though as predictions are that pricing will continue to commodotise further reducing margins for carriers. However, anyone offering value added services that utilise SMS as the communications transport should see their efficiencies increase as a result of lower wholesale SMS pricing. My personal experience suggests that commodotisation isn't filtering down to the street level though and during 2010 I actually witnessed prices in certain countries (stand up the Netherlands, guilty as accused) increase prices significantly as SMS bypassed regulation that was squeezing network operator revenues elsewhere, such as voice services.
With researches claiming between 4.2bn and 6bn active mobiles worldwide, it's obvious that at some point growth is set to slow down - soon everyone will have one, maybe two devices. Of course individuals will continue to upgrade to newer models constantly, so the manufacturers will be happy, but from a messaging point of view the number of participating users is surely close to its maximum by now. Again, value added services is where growth for service providers will come from - messaging including SMS is just a capability to enable a range of innovative products and services.
I think with the trend for unlimited 3G access in decline and Wifi growth seemingly stalling, I think the old GSM originated technologies such as SMS have a very long and fruitful life yet to come.
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