Billing Confusion Hampering American SMS Uptake

According to an A.T. Kearny report published earlier this year, global SMS useage will climb to more than 200 billion messages sent quarterly by the end of 2002. Yet, while SMS use continues to gain momentum elsewhere, within the USA text messaging remains a virtually unknown commodity. Michael Pousti, chairman and chief executive officer of SMS.ac says that significant revenues generated from wireless data are literally at the fingertips for domestic mobile carriers.

"Unlike other areas of the world, U.S. consumers are currently exposed to poor consumer experiences where text messaging is concerned," said Pousti. "Delivery reliability, billing confusion and walled garden approaches are irrefutably frustrating consumers and prohibiting adoption here.

"That's the bad news," continued Pousti. "The good news is that consumer appetite for wireless data continues to grow. "There is tremendous potential for U.S. growth in this area. For some wireless operators in Europe and Asia, SMS already accounts for nearly 30% of total revenues-- and figures like that are attainable domestically. But, U.S. carriers need to huddle and offer consumers attractive and easy-to-understand solutions now in order to reap similar rewards. It doesn't make sense for the carriers to disappoint consumers with what's now being offered and then claim later that there was never any real demand."

Despite announcing network interoperability earlier this year, domestic wireless carriers are not seeing the same adoption of SMS messaging that is occurring throughout Asia, the Pacific Rim and Europe. Nor are U.S. carriers sharing significantly in the more than US$5 billion that is currently generated each month from SMS. And the outlook for increased SMS traffic is bright.

Durlacher projected that an estimated 329 billion text messages will be sent in Q2 2003. Increased SMS adoption in the U.S. would push that figure significantly higher. But, why are U.S. consumers so slow on the SMS uptake? The reason seems to be consumer unrest with related U.S. carriers' products and services.

Even U.S. mobile customers that already send SMS readily admit to continued frustrations over billing and usage. A recent SMS.ac poll that attracted 12,774 respondents from within the U.S. revealed that 69.5% of those surveyed are still not sure whether they pay their carriers to receive text messages, to send, or both. And 57.8% of those polled said that they were required to contact the carrier's customer service in order to text-enable their phones.'"

Posted to the site on 16th October 2002