Press release: OTT messaging traffic will be twice the volume of P2P SMS traffic by end-2013

The volume of OTT messaging traffic is set to be twice that of P2P SMS messaging by the end of the year, according to data collected by Informa Telecoms &  Media.

Daily OTT messaging traffic has already overtaken daily P2P SMS traffic in terms of volume, according to newly collected data from Informa, with an average of 19.1 billion OTT messages sent per day in 2012, compared with an average of 17.6 billion P2P SMS messages.

By the end of 2013, Informa estimates that 41 billion OTT messages will be sent every day, compared with an average of 19.5 billion P2P SMS messages. There are far more P2P SMS users than there are OTT messaging users: There were about 3.5 billion P2P SMS users in 2012, according to Informa, compared with about 586.3 million users of OTT messaging. Each OTT user sent an average of 32.6 OTT messages a day, compared with just five SMS messages per day per P2P SMS user, meaning that OTT-messaging users are sending more than six times as many messages as P2P SMS users do.

It has taken OTT messaging about five years to reach this point; BlackBerry Messenger was launched in 2007, and a number of other messaging apps have launched at various intervals since then. By contrast, the first SMS was sent about 20 years ago, with the first commercial service launching a couple of years later.

Even though SMS and OTT messaging are two different services, and are used in different ways by subscribers, Informa believes that a comparison of the average daily traffic of the two services is relevant, given that OTT messaging is increasingly used as a substitute for SMS in a number of markets.

Mobile subscribers’ adoption of OTT messaging has had a significant impact on mobile operators’ SMS traffic and revenues in some countries, including Spain, the Netherlands and South Korea. For example, mobile operators’ SMS revenues in Spain have declined dramatically, down from €1.1 billion (US$1.4 billion) in 2007 to €758.5 million in 2011.

It is unlikely that SMS will die out anytime soon, however. Informa forecasts that global SMS revenues and traffic will continue to increase through 2016, for three main reasons: The adoption and use of OTT-messaging apps is far from universal; although there are multiple OTT-messaging “communities” within which mobile users can message each other for free, OTT-messaging users typically use SMS when communicating with non-OTT users; and SMS is starting to hit its stride in the enterprise mobile messaging market.

Note: Over-the-top (OTT)-messaging applications are downloadable applications for smartphones that enable subscribers to send text (instant) messages for free to users of the same application, using their mobile data plan or Wi-Fi. P2P SMS is person-to-person SMS.


About the VoIP and IP messaging: Operator strategies to combat the threat from OTT players report

This report (www.informatandm.com/messagingip) provides a detailed analysis of the OTT-IP-communications market, including an evaluation of the threat that OTT IP communications represents to mobile operators, market enablers and inhibitors, operators’ strategies for OTT communications and the outlook for OTT IP-based messaging for operators and OTT providers.

For more information or to arrange an interview, please contact:
Bethan Casey
Marketing and PR,
Informa Telecoms & Media
Email: pr.enquiries@informa.com
Tel: + 44 (0) 207 017 4994
Twitter: @informatm_pr

About Informa Telecoms & Media Informa Telecoms & Media (www.informatandm.com) is the leading provider of business intelligence and strategic services to the global telecoms and media markets.

© Informa UK Ltd 2013. All rights reserved

Comments
  • William Dudley April 29, 2013 at 3:01 pm

    Pamela:

    Really? I can certainly agree that non-SMS interoperable OTT has overtaken MNO SMS in some markets, but globally? Remember, the US market has OTTs; however, these are virtually all SMS-interoperable and the US market remains one of, if not THE largest SMS market in the world, now. Also, I’ve read in other sources that the overall volume growth from some OTTs such as WhatsApp has now significantly dropped.

    Again, I agree that this has occurred in some markets, but our numbers just don’t show that for an overall global basis. I think you may have seen my numbers that showed that iMessage in the US market had cannibalized approximately 20% of SMS volumes, during a recent iMessage outage. Other OTTs such as Kik/WhatsApp have tremendous competition from the SMS-interoperable OTTs such as Pinger, TextPlus, Mediafriends, Google Talk and many others that dominate this market.

    I’d love to find out more as to how you came to this conclusion.

    My best regards.

  • Avatar
    Pamela Clark-Dickson April 29, 2013 at 4:00 pm

    Hi Bill,

    Thanks for your comments. Yes, that is what our data shows, that, globally, average daily OTT messaging application traffic has overtaken average daily P2P SMS traffic. Probably the main thing to point out here, which I have also done above, is that P2P SMS and IM are used in different ways, that is, mobile subscribers are likely to use P2P SMS for messages that don’t necessarily require an instant response, whereas OTT messaging applications are essentially instant messaging apps, where both parties are aware of whether the other is online, and able to message, which drives a higher volume of communication than SMS, and even higher volumes if group messaging is enabled. ‘Free’ has also been a great driver of OTT messaging traffic (using quotes around ‘free’ because subscribers need smartphones and mobile data plans/WiFi to access the services!).

    I acknowledge that in a number of markets that same behavior occurs with SMS because the operators offer large bundles of SMS or unlimited SMS – such as the US, where OTT messaging applications have not had as much of an impact as in some European and Asian markets. But this is not the case in all markets.

    I’ve been tracking WhatsApp traffic over the past few quarters, and I too, see that they had very strong growth in daily messaging traffic during 2012, and that this does appear to have tapered off since 4Q12, which I have also factored into my calculations.

    Edited: I have since spoken to Neeraj Arora at WhatsApp, who tells me that WhatsApp’s daily traffic has not tapered off, with inbound traffic (sent messages) doubling every six months to March 2013. It will be interesting to see if that level of growth can be maintained over the next six months, since the base is not so low anymore.

    I’ve also clearly stated above that I don’t believe that SMS will die out anytime soon for a number of very good reasons. But I do think that we need to recognize and acknowledge the scale of OTT messaging, especially now that there is data that we can analyse.

    I’m happy to discuss this further with you offline, and will DM you to arrange.

    Best regards,

    Pamela

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