7typingThe increased availability of mobile broadband data is causing a shift in the nature of communication, one that is only now becoming noticeable.

In a report from July 2012, Ovum reports that by 2016, telco operators worldwide will lose US$54 billion in SMS revenues to alternative forms of messaging. This is more than double the US$23 billion loss predicted for the end of 2012. In the report, titled Countering the Social Messaging Threat, Ovum predicts that these losses will affect most countries in Europe and the Asia Pacific[1].

This erosion in SMS revenue is the sign that mobile is becoming more mature, as online messaging services, like Whatsapp challenge the convenience of older technologies like SMS. Already Whatsapp has established a great popularity with users in the Netherlands and Singapore, and even smaller services like fring and Line are also likely to contribute to this effect.

Recent research into mobile use by the Mobile Marketing Association backs up this notion, with survey respondents indicating that text messaging is their number one mobile activity (86 per cent), with entertainment coming second (73 per cent) and calling in a meagre third place (65 per cent). The mobile phone has certainly moved beyond being a simple voice communication device.

This also reflects the nature of mobile phone use in Singapore, a country that is very often mentioned together with Korea and Japan as being at the forefront of mobile phone adoption. Singapore government statistics indicate that there are over 7.8 million mobile subscriptions nationwide, reflecting a mobile penetration rate of over 150 per cent. The Mobile Marketing Association’s research also revealed an interesting bias, with 90 per cent of those surveyed reporting that they own smartphones.

Perhaps it is the smartphone that is causing the shift – certainly it is the smartphone apps that allow users to bypass costly SMS charges and send messages using the data plans that they have already paid for. The outlook for operators does seem dire, when posited in terms of what they stand to lose.

But it’s not a complete loss – telcos are the ones who make mobile data available to users in the first place, and if they embrace the wave of text messaging that seems to be cresting, then perhaps they will find a way to offer innovative new services that address actual consumer need. Not that SMS messaging will vanish altogether, but operators need to consider the ramifications of alternative messaging systems.

There may be other possibilities. Singaporeans surveyed reported that they also owned other gadgets: 45 per cent own MP3 players, 38 per cent own tablets and 36 per cent have gaming devices. Many of these devices can benefit from mobile connectivity, and could form the basis of new revenue streams for operators.

In any event, it is consumers who decide how they want to use mobile platforms like smartphones, tablets and so on – and it is operators and others who must be responsive to those needs. Singapore may not be typical, but it is entirely possible that Singapore is one possible future, and that other Asian countries will also move in a similar direction as their mobile industries develop.

By Rohit Dadwal, Managing Director, Mobile Marketing Association Asia Pacific Limited

[1] Ovum figures indicate that operators will lose $54bn by 2016 due to smartphone messaging apps, http://ovum.com/press_releases/ovum-figures-indicate-that-operators-will-lose-54bn-by-2016-due-to-smartphone-messaging-apps/