Mobile network operators lost an estimated £8.8bn last year thanks to free messaging apps, a report suggests.
The research comes courtesy of Ovum, which reckons apps like Apple's iMessage, BlackBerry Messenger, Facebook chat or Samsung's ChatON have left the network industry, which is used to raking in cash from text messages, $13.9bn (about £8.8bn) poorer.
Non-SMS messaging apps use a mobile's data connection to send messages for free, thanks to the infinite magic of modern mobile tech.
The report worked out the most popular social messaging apps globally, then estimated the amount of people with those apps who would be using them instead of sending SMS messages. This was used to estimate how much revenue networks could have made. I was told the research also took into account that some people would be using more than one messaging app.
The BBC says however, that the research doesn't take into account the extra cash networks are raking in from charging people to use data on their phones.
One thing's for sure though -- if you and your buddies own smart phones, there's not much reason to send text messages anymore. And I'm not sure how network operators like Orange, Vodafone or O2 plan to account for a decline in text messaging.
One simple solution would be to crank up contract costs and making some extra cash that way. But obviously that wouldn't go down well with customers, who won't feel like paying more money each month.
The author of the research suggests that networks should be partnering with app developers and working with the companies that actually sell mobiles, as they'll be able to fill phones with pre-installed apps. Mobile broadband is also mooted as an alternative source of revenue.
Do you still send texts? Or have messaging apps taken over from old-timey SMS? Let me know your preferences in the comments below, or over on our Facebook wall.
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anonymous 22 February, 2012 11:15
" I'm not sure how network operators like Orange, Vodafone or O2 plan to account for a decline in text messaging"
By eliminating unlimited data plans. Take 02 - the iPhone data plan is now capped. So if you're using iMessage to send free texts and MMS messages (free messaging for pictures is great) - once you exceed your data limit (easy when using Facebook on the move) - it's not free.
shauney3 22 February, 2012 12:04
Hmm, I think this is misleading. Maybe for Pay-as-you-go users, there might be a point. But in my contract they charge for texts, calls and internet, whether i use them or not...
P.S go GiffGaff!
anonymous 22 February, 2012 12:22
Those calculations are absolute rubbish. It's the same argument made about lost revenue from piracy, but let's me realistic, most people would not send the same amount of texts as they do free IMs. Besides, operators have been ripping customers off for years charging around 10p for such a tiny snippet of data.
Mat Greenfield 22 February, 2012 12:27
I'd be interested to know how the inclusion of these services affected sales, though. Chances are that BBM costs RIM money but at the same time doubles the sale of Blackberries; since that seems to be one of their main draws for most people (albeit my only evidence of that is speaking to people and therefore anecdotal).
I still send texts just because people very often have Facebook open but seldom glance at it. Of course, people can ignore their phone beeping too but it just feels more direct.
anonymous 22 February, 2012 13:35
phones already have enough crap on them pre-installed by the network operators, that's why rooting is so popular...
what I would say to the networks is "STOP FILLING MY PHONE WITH YOUR BLOATWARE"
anonymous 22 February, 2012 15:09
Good for them, greedy corporations. When SMS was in its boom they make billions of profits. What about roaming charges?
anonymous 22 February, 2012 23:48
anonymous, these apps use next to no data. Also with o2 you can still use data after you've used it up, but it's slowed down and you don't get charged for it.
anonymous 27 February, 2012 11:44
well it serves the telco's right really that they now have a lower income from SMS.They all have been robbing us blind for since day one. SMS should be FREE.
Its costs the telco's absolutly nothing to carry sms's on their network because every sms sent from either a dumb or smart phone rides on the back of the signal that is alway connected to your phone. You see, your phone always talks to the network to "ask" do I have signal? and it asks this all the time. Your sms's piggyback on this constent signal asking.
So I for one welcom the news that telco's are loosing out.