Happy Birthday, texting: 21 today

December 3, 2013

–Iain Regan is global head of sales, marketing and customer management at Firstsource Solutions. The opinions expressed are his own.–

Text messaging feels like such a contemporary part of our lives that it is hard to believe that SMS is today marking its 21st anniversary. On 3 December 1992, Neil Papworth, a 22 year old test engineer for Sema Group in the UK used a PC to send the text message “Merry Christmas” via the Vodafone network to the phone of Richard Jarvis in Newbury.

From these lowly beginnings, SMS has revolutionised our social lives and the way we do business. But is it now under threat from over-the-top (OTT) messaging applications like Snapchat and WhatsApp?

Analysts Ovum estimate that carriers lost £15bn of potential SMS-related revenue in 2012 due to the growing popularity of instant messaging apps. Not only do they mimic the instant messaging capacity of SMS, but they add features that SMS does not provide for, moving beyond one-to-one communication to provide persistent group conversations, and enhancing the plain text with multi-media capabilities.

Yet more than 90% of mobile owners still use text messaging, and a YouGov survey for Firstsource shows that over 80% of UK consumers send as many or more text messages than they did a year ago. (A quarter (24%) of women surveyed send more, compared to a fifth (19%) of men).

One element that’s kept SMS use buoyant in the UK is that while instant messaging apps initially represented a much cheaper per-message cost for heavy users, operators have responded by bundling a large SMS allowance into contracts.

Informa expects that despite the growth of instant messaging apps, global SMS revenue will grow, to $127 billion by 2016 from $115 billion last year.

Chief among its strengths is that SMS retains the unique position of being the single channel capable of reaching virtually every mobile on the planet. Instant messaging apps have their devotees, but in specific silos – there is no industry standard to allow interoperability – and they are useless for the large number of users, particularly in the developing world, still using basic phone models rather than smartphones.

SMS also needs only a phone network, rather than the additional and less robust Internet connection that instant messaging apps require.

In a multi-channel world, users are comfortable with using SMS when these factors of universality and reliability are key (which is particularly the case for business use), alongside the growing use of instant messaging apps when group conversations or multi-media are more important.

The relationship between SMS and instant messaging apps is continuing to evolve. Facebook has recently withdrawn support for SMS on Android devices while promoting its Messenger service, whereas Google’s Hangouts app has now embraced SMS capability.

In the future, new messaging apps may be launched that will pose a stronger threat to the continued success of SMS. For now, we should all wish a “Happy Birthday” to phone text messaging, in whatever form.

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