By 2016, operators will lose $54 billion a year in...
By 2016, operators will lose $54 billion a year in SMS revenue because of social messaging services on smartphones, more than double the $23 billion operators expect to lose by the end of 2012, research firm Ovum said in a…
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forecast report Thursday. Operators must collaborate with handset manufacturers if they are to remain “relevant and competitive” in the messaging industry, Ovum said. Social messaging is not a short-term trend, and the number of over-the-top (OTT) players that threaten the operators’ position has increased rapidly, Ovum said. “Operators need to understand the impact of social messaging apps on consumer [behavior], both in terms of changing communication patterns and the impact on SMS revenues, and offer services to suit,” said Neha Dharia, consumer telecoms analyst at Ovum, in a news release. Europe and Asia-Pacific-based operators will be most affected by increased OTT messaging activity, Ovum said, noting that prominent social messaging brand WhatsApp has seen its penetration levels increase in the Netherlands and Singapore. Smaller players like textPlus and Pinterest will cause further disruption in the messaging space, Ovum said. “OTT players are changing consumers’ messaging preferences, and the pressure they are exerting on operators’ messaging services is forcing them to offer increased SMS bundles and to experiment with messaging pricing models, further dampening revenue growth,” Dharia said. Operators are looking to the Rich Communication Suite (RCS) platform to improve their standing in the messaging industry, but it is not expected to reach the mass market before 2014, Ovum said. In the meantime, operators will need to rely on innovative pricing strategies, partnerships and launching operator-branded messaging services to keep up, Ovum said (http://xrl.us/bntoj6).