The end of SMS debate
Clickatell CEO, Pieter de Villiers says that SMS will be here for a while, as IP messaging is finding its feet in terms of accessibility, reliability and unified platforms.
Speaking to MyBroadband from Clickatell’s headquarters in Redwood Shores, California, de Villiers highlighted that all reputable research shows that SMS still rules the mobile messaging market in terms of both traffic and revenue.
“SMS generated the highest revenue in 2011 and SMS revenue is forecast to dominate worldwide mobile messaging over the next five years to 2016,” said de Villiers.
“Nearly 8 trillion SMS messages were exchanged worldwide in 2011, and total SMS traffic is expected to near 9 and a half trillion by the end of 2016. It will be many years before any other mobile service can rival that type of volume.”
Mobile messaging services like BlackBerry Messaging (BBM) and WhatsApp are growing in popularity, but de Villiers argues that ‘free’ is not enough to make people migrate.
“It is not a question of which whether or not free or paid-for text messaging will prevail, because consumers will pay for cell phone services and convenience for as long as the services are easily accessible and reliable,” said de Villiers.
“When services are free, we tend to be a bit more ‘tolerant’ with accepting a less than ideal user experience or service quality. The ubiquity, reliability and ease-of-use of SMS make it the best way to reach a mobile consumer today.”
“Tomorrow there may be another set of technologies that achieves this at a lower cost to the end users and our customers. As the pioneers of enterprise SMS, we expect to be at the forefront of that shift too,” said de Villiers.
The end of SMS
De Villiers said that a hot topic in the mobile messaging industry at the moment is the issue of ‘the end of SMS’ and the rise of Over-the-Top (OTT) messaging services.
According to the Clickatell CEO, there is no doubt that OTT messaging services have gained momentum, particularly amongst mobile users with smartphones, but OTT messaging services also have their limitations.
“The services usually offer free texting between users with the same application, handset brand or operating systems. The 2012 Portio research shows that although OTT is expected to grow in popularity it is not expected to cannibalize SMS nearly as much as many people think,” said de Villiers.
“Instead, the view is that OTT traffic and SMS traffic is going to grow synergistically side-by-side. As new ways of messaging become available, consumers tend to adopt the new ways alongside the old.”
De Villiers added that SMS is also still expected to dominate the growing A2P market (messaging that originates from, or terminates to, an application).
“A2P growth is bolstered by the use of SMS for mobile marketing by third parties and by mobile operators to promote their own services. Traditional bulk messaging for services such as alerts, horoscopes, showbiz, stocks and traffic updates are also showing solid growth,” said de Villiers.
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