Operators Miss Out on US$4.9 Billion Additional SMS Revenue Each Year
Anam Mobile, a premium SMS service provider says that global mobile operators are losing out on as much as €3.6 (US$4.9) billion of revenue per year through lost opportunities to create value-added SMS messages. Anam notes that currently, a large proportion of text messages are included as part of bundled deals provided by operators and therefore are, in effect, free to the customer. This means that each individual message has a low perceived value to the user and almost no financial value to the operator.
However, there are many applications that could potentially be introduced to consumers through SMS. If the subscriber is able to use SMS to interact with their device in a more efficient, more enjoyable or more productive way, then they will be willing to pay a small additional fee for those SMS messages. The subscriber will accept that these messages fall outside of the 'free' text bundles, or add on a new bundle to their service plan; SMS messages are one of the few services that the user will always know how to use on their mobile phone.
Gerry McKenna, CEO of Anam says, "I am constantly surprised that, until now, operators have not fully grasped the opportunities available to them through SMS. The €3.5 billion of missed revenue can be earned by simply enhancing the text services that they offer customers. There doesn't need to be a shift in consumer mobile behaviour - they can stick with their trusty SMS message, whilst the operator is able to create immediate results with additional revenue streams."
Anam says that examples of the kind of services that could be introduced by operators to increase the value of text messages include:
- SMS money transfer: a service that allows global money transfers to contacts in your address book, merely by sending an SMS
- Corporate functionality for your mobile: providing, amongst other things, a text message 'out-of-office' alert for your mobile phone, copying text messages to email, allowing individuals to set when they can be contacted and avoiding calls or messages being received during busy meetings or when driving for example.
- Mobile advertising: placing targeted ads inside text messages as they are sent that offer specific deals or offers. These could be offered free to users as advertisers fund the service.
The €3.6 (US$4.9) billion figure is based on an assumed total of 2,400 billion text messages being sent over 2007 - 600 billion in Q1 multiplied by four. If 1.5% of mobile subscribers send one money transfer text message per month, with an additional charge of €3.50 to cover the service, operators can generate an average extra revenue of €0.0015 for every text message sent on their network.
Posted to the site on 28th August 2007