Messaging Gets More Crowded


This post appeared on my Sybase 365 blog and reposted on my SAP Blog on September 22, 2011.

Mobile messaging, especially SMS-based messaging, has seen a resurgence of usage in the US market; however, it is not necessarily carrier-based SMS that has grown.  There are a growing number of messaging apps and services that have been launched and announced, and services such as iMessage are just around the corner.   This runs somewhat counter to recent industry and general press, were we’ve seen articles stating that “SMS is dead (or dying)” and that non-SMS “chat” services are displacing true, mobile-SMS interoperable services.    Certainly, in some markets, non-SMS “chat” services have cannibalized some SMS revenues – especially outside of the USA and Canada, but in general mobile operator SMS (as we know it) is alive and well.  

I’ve made the case, that by enabling and including 3rd-party, SMS-interoperable services (such as various NUVOs) in a GSM-only country, the MNOs can push back against the non-SMS chat services, as subscribers will utilize the NUVO-style services on non-mobile telephone devices.

Recently, AT&T Foundry – described as “innovation centers that are home to our collaboration with tech leaders and start-ups to fast-track new apps, platforms, and more,” launched a solution called AT&T Messages.

This new service, currently in Beta testing on Android platforms, enables users to make all of their messages (both SMS and MMS), voicemails and call logs accessible from multiple devices, such as PCs and tablets. At this point, I am not clear whether or not this requires that your AT&T text/multimedia messages require a different app vs. the native built-in app. And if you have an iOS device, then how does that play with iMessage, which should also use the built-in messaging app (which reverts to standard SMS when the destination is not another recognized iOS device)?   Are iOS-only communications, which are designated differently than SMS-based messages in the application, also available via the cloud to other devices?   While this sounds good, I think there are a lot of compatibility questions that are not addressed.  It should be noted that AT&T Messages is not a new messaging community or ecosystem – but one that extends their existing messaging into the cloud and thus additional devices.

As of this writing, iOS 5 has not launched yet, which includes iMessage.   Since the iMessage announcement, Facebook Messenger also launched, which does indeed interact, leveraging SMS short codes, with non-Facebook Messenger users via standard SMS; however, a non-Facebook user cannot independently address a Facebook Messenger users via SMS.

Another, non-SMS-interoperable messaging service from Samsung called ChatON was announced on August 29th of this year.  Like many “messaging apps,” this does not interoperate with the SMS ecosystem; however, this is targeted for multiple device families: Android, iOS, Samsung Bada, and Blackberry.  ChatON will also include image and video sharing as well as group messaging. I do not think this is live video calls such as what you can get with iOS Facetime, Fring, or Skype.  It is more MMS-like (but not compatible with the true-global MMS ecosystem).  While packed full of nice features, I have to note that as it is not interoperable with the legacy (and largest) SMS ecosystem, and everyone else that you “ChatON” with must also be using the same application.

With the addition of Facebook Messenger and ChatON, we now have two, rather large install bases of users that will use a non-SMS-interoperable messaging application.  It remains to be seen if these will cannibalize traditional SMS traffic and revenues from the Mobile Network Operators (MNOs).  Certainly, in some countries, apps such as ‘WhatsApp’ have already done so.  In the United States and Canada, however, the app-based NUVOs have dominated the non-MNO “free messaging app” market.  While users are typically assigned an alternative telephone numbers, the usage of these, along with their traffic continues to grow.  If one includes Google Voice, Pinger’s TextFree, various Gogii TextPlus apps, the TextFree app, the Mediafriends HeyWire app, Toktumi’s Line2 app, the GroupMe app and Enflick’s TextNow app, I estimate that the overall subscriber count is in the 15-20 million range – maybe more.  I have also seen statistics that there are actually more of these apps loaded onto non-mobile-telephone devices such as iPod Touches and various tablets than onto mobile phones.  Consequently, they were the first and still lead in terms of bringing traditional mobile messaging to non-mobile telephone devices.   That interoperability has helped improve overall mobile messaging traffic grow in the North American market.

While it is too early to tell, the recent non-SMS interoperable ‘chat’ launches have only further fragmented the app-based chat options.  While there is nothing that says these companies can’t launch their services, those that continue to assume that their brand will dominate the non-SMS “chat” space are somewhat deluded.  History is a good teacher and the most successful non-verbal communication medium in the history of mankind is SMS.  Why?  Because it literally reaches over 5 billion people and is now a very strong channel for short code based consumer outreach and in some markets mobile payments. SMS is ubiquitous.  That won’t change in the foreseeable future.

MNO based “traditional” SMS Is certainly under siege; however, various press articles’ notion that SMS is dead or dying is quite premature.  NUVOs are playing a great role in the overall ecosystem by offering alternative messaging applications and this should continue if the NUVO companies can continue to grow users and revenue, as well as offer innovative services that users will embrace.  AT&T made a good start by incorporating the cloud-based AT&T Message capabilities.  NUVOs have already been doing this for some time and it is probably a matter of time before we see more MNO/NUVO partnerships such as the Sprint/Google Voice partnership.

As you can see, the “messaging space”  is getting crowded and at some point, there will be a consolidation of sorts.  I will say that messaging and social networks go hand in hand, and someone will eventually offer a true NUVO-style messaging component of a social network that will indeed be a killer app.