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Texting turns 20 – but is SMS now doomed?

Paul Withers
December 17, 2012

Text messaging has celebrated its 20th birthday, but a new wave of data-centric services for smartphones is threatening its existence 

In 1992 a British engineer by the name of Neil Papworth made history by becoming the first person to send a text message.

At the time Papworth was an engineer for Sema Group Telecom, now Airwide Solutions, which was working with Vodafone to develop a ‘short messaging service’ (SMS) originally intended for pagers.

Having installed the software at Vodafone’s Newbury offices, he sent the first ever SMS, “Merry Christmas”, via a PC to then Vodafone technical director Richard Jarvis, who received it on an Orbitel 901 (pictured).

Unbeknown to them, Papworth had been the first to use a technology which would fast become the most widely used data service on the planet, with more than eight trillion sent last year by more than 3.6 billion users.

Of these, 150 billion were sent from the UK – triple the fi gure sent in 2006. According to regulator Ofcom, the average user now sends up to 50 per week – with those aged between 12 and 25 years averaging close to 800 per month.

Time for change

But as the service celebrates its 20-year anniversary, there is a sense it has now hit its peak.

According to regulator Ofcom, the number of text messages sent in the UK during the first half of 2012 fell for the first time. During Q1, 39.1 billion were sent and in Q2, the number was 38.5 billion – down from 39.7 billion in Q4, 2011, which is the busiest time of year for messaging.

Ofcom director of research James Thickett said: “When texting was first conceived many saw it as nothing more than a niche service. But texts have now surpassed traditional phone calls and meeting face to face as the most frequent way of keeping in touch for UK adults, revolutionising the way we socialise, work and network.

“But for the first time in the history of mobile phones, SMS volumes are showing signs of decline.”

According to industry analysts, the fall can be credited largely to the wave of new data-centric services on offer to customers using smartphones.

Email, which has far superior features and fewer limitations than SMS, has become an important feature for both consumers and businesses and is now a key feature on mobile devices.

The same can be said for other services such as BlackBerry Messenger (BBM), launched in 2005. Social networking sites Facebook and Twitter and WhatsApp have also provided new ways for people to interact, further reducing the reliance on SMS.

Another factor is that the cost of text messages outside a bundle has remained at around 12p for the best part of a decade. Data-centric services such as those mentioned are free.

IHS Insight senior principal analyst Ian Fogg commented: “SMS took o because it was fast, reliable cheap and convenient. You could read or send a text in a meeting and it was also cheaper than a telephone call.

“The problem is it began to lose its relative cheapness with data-based services that came from third parties – these were free and included a greater range of features.”

CCS Insight director of apps and media Paolo Pescatore agreed: “Given time, the web-based brands services like Skype will grow in popularity. Web-based messaging also has the advantage that you can send a message and see it on multiple devices, be it your tablet, PC or smartphone. With a text it’s just on your phone, and that can be a huge advantage to the web players.

“As a result we’re now seeing the decline of SMS, and it was predicted a long time ago but the operators were pretty slow to react. It won’t completely die any time soon but it’s seen its peak.”

However, according to Informa senior analyst Pamela Clark-Dickson, the future of SMS remains “bright” for now.

She claims data access remains a stumbling block for some users of the alternatives, while those who have e effectively grown up using SMS – prior to the smartphone evolution – are likely to continue using the service rather than switch.

Clark-Dickson said: “It will be some years before free messaging applications can achieve the same level of penetration as SMS. The proliferation of smartphones and mobile broadband represent barriers to entry for consumers, as does the lack of interoperability between the web-based offerings.

“We’re also seeing that texting behaviour is integrated in certain demographics like the over-30s. They are used to it now and it will take a while for the web-based players to spread from their silos in the youth market to the older smartphone users.”

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