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Mobile broadband revenues will outpace SMS revenues after 2013
TT Correspondent |  |  02 May 2013

According to research firm Ovum mobile broadband revenues will outpace SMS revenues after 2013. Its latest study says that SMS growth rates fell from 14% in 2011 to 8% in 2013, and SMS revenues have fallen since the emergence of social messaging.
 
“After 2013 mobile broadband revenues will form the bulk of operators’ non-voice revenues (contributing 43% of revenues in 2014). They will outpace revenues from SMS, with messaging forming a smaller proportion of data revenues (40% in 2014); 2013 will be the last year that SMS brings in the largest proportion of non-voice revenues, and by 2015 SMS revenues will begin to plateau”, said Neha Dharia, consumer analyst at Ovum. 
 
She says that there are several reasons for the erosion of messaging revenues, and the rise of social messaging players is a key factor. The bundling of SMS with calling minutes and mobile broadband plans has also contributed to the decline of messaging revenues. Ovum forecasts that social messaging cannibalization of SMS revenues will grow from $32.6bn in 2013 to over $86.0bn in 2020.”

The period 2013–15 will be crucial in terms of the relationship between telcos and OTT players in the communication space. Ovum expects partnerships in this area intensify during the course of 2013. WhatsApp already has a number of operator partnerships, including a roaming pass with 3 in Hong Kong and the GSM-based service offered by Reliance Communications in India. Facebook has a long history of working with operators, and its new partnership with 18 global operators will allow free or discounted data access to the social network’s messaging platform. Social messaging player Viber’s CEO has stated that the company will be happy to share revenues from paid services once it begins to charge consumers. Such operator partnerships help OTT players to broaden their reach, while the operators benefit from the sale of subscription plans.

“Most social messaging services are currently either free or based on discounted plans. In 2013 we will see a large number of social messaging companies begin to grow into content platforms. KakaoTalk and Line already have growing revenue streams from games, emoticons, and marketing channels, while social gaming service DeNA has introduced a messaging service, Comm, to anchor its existing gaming platform. Social messaging’s viral growth, high level of engagement, and sticky nature make it a strong foundation on which to build a content platform.
  
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02 May 2013(IST)  
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