MMS Prices Hold Down Volumes

The average price of a 30KB MMS was US$0.37 in December 2005, just over 4 times as high as a standard SMS, according to the December 2005 edition of Informa Telecoms & Media's World Cellular Data Metrics, based on data recorded for 234 operators worldwide. While the price ratio narrowed slightly compared with 4.19 in December 2004, the high cost of sending MMS remains the key reason for continued disappointing traffic volumes.

"Pricing is fundamental to the success of MMS. Subscribers are still unwilling to pay the comparatively higher tariffs for MMS and until the price ratio with SMS narrows, traffic volumes will remain low," remarked Kester Mann, Senior Research Analyst at Informa Telecoms & Media. "Interoperability, ease of use, handset penetration and service development are other important factors, but pricing will remain key in the long term."

Global MMS traffic more than quadrupled in the year to September 2005. But the initial base was only small and over 280 operators have now deployed the service. Only three operators recorded MMS traffic volumes above 100 million messages in Q3 2005, according to Informa Telecoms & Media: Verizon Wireless (USA), Sprint Nextel (USA) and Telcel (Mexico).

Meanwhile, China Mobile, the world's largest operator, recorded total SMS traffic of 62.8 billion messages in Q3 2005, 800 times higher than its MMS traffic (78.6 million messages). The cost of sending an MMS through the operator's network was CNY 0.90 (US$0.11) in December 2005, compared to just CNY 0.01 (US$0.001) per SMS.

Posted to the site on 16th January 2006