Messaging revenue still vital to mobile operators

10 May 2006

At a time when operators are heavily focusing on rolling out data applications and offering a wide range of content, their bread and butter still lies with SMS, new research indicates.

According to a recent IDC study the mobile messaging market in western Europe, which includes short message service (SMS), multimedia message service (MMS) and mobile instant messaging (MIM), will be worth more than US$15.4bn in 2010.

“Mobile messaging will continue to play a key role in the industry for many companies, not just mobile operators,” said Paolo Pescatore, research manager for IDC’s European Wireless and Mobile Communications service.

Pescatore believes that each of the three services addressed in the study serve a specific and different purpose and operators need to find out how best to serve their target markets. If not they may lose out on any opportunities to third-party companies.

Within the MMS opportunity, simple services from MMS postcards to new ways of sharing, such as MMS online photo albums, which operators are not doing enough to promote, could be of high value to users, the study says.

Pescatore said SMS generates the greatest amount of end-user spending and this will continue throughout the forecast period.

The situation is quite different regarding MMS, for which usage is relatively unpredictable. During the forecast period usage does increase but users have not realised the value it can bring to them.

The MIM market is still fragmented and IDC believes the true value to users will be presence in the form of devices enabled by technologies such as session-initiation protocol.

By John Kennedy