SMS to drive mobile revenues until 2010

15-12-2005

by Charlie Taylor

SMS messaging will continue to be a leading revenue driver for mobile operators over the next five years, according to a new report.

Despite the rise of more advanced forms of messaging such as multimedia messaging service (MMS) and mobile e-mail, SMS is expected to represent a key source of income for operators due to its ongoing popularity.

Informa Telecoms & Media's new "Mobile Messaging 2005" study indicates that person to person (P2P) messaging will continue to be popular among both business users and consumers. However, the research firm predicts that application to person (A2P) and interactive messaging will become increasingly important as new services such as mobile marketing and delivery of rich content come on stream.

"We believe the messaging market has great potential. With total revenues approaching USD120 billion globally by 2010, this is one of the key growth sectors in mobile services," said Dan Winterbottom, one of the report's authors.

Although growth is expected to come primarily from new markets, the rise in spending is also being partly driven by business users who are increasingly turning to enhanced messaging services such as mobile e-mail.

Informa's research also reveals that the A2P market has witnessed a considerable amount of evolution over the past few years due to increased availability of higher performance handsets. The result of this has been that in addition to existing content such as ringtones and games, consumers can also take advantage of new content forms such as music downloads and mobile blogging.

The company says that the outlook for enhanced messaging including mobile e-mail, MMS and Instant Messaging (IM) also look promising going forward.

However, the firm suggests that success is dependent on providing real benefits to consumers. Device usability, for example, is considered a key success factor for messaging, while issues such as how to manage the convergence of different messaging types will also be critical.

This latest research from Informa echoes a September report from Portio Research, which forecast that SMS messaging would continue to rule the roost around the world with revenues of USD50 billion by 2010. That study said that despite the emergence of new technologies such as MMS, mobile instant messaging (MIM) and push to talk (PTT), SMS would remain the most popular messaging format for the coming years.

In Ireland, mobile penetration currently stands at around 96 percent of the adult population, with the average mobile subscriber sending over 90 messages a month.