Text Messaging Revenue Has Peaked, Starts Decline in 2013

Global consumer spending on operator messaging services, including text messaging (short message service, or SMS) and miultimedia messaging service (MMS) has peaked in 2012 and will begin to decline in 2013, says Strategy Analytics.

In other words, you now can definitely add mobile messaging to the list of legacy services that now have passed their peak adoption and are declining. 

According to the latest Global Mobile Messaging Forecast from Strategy Analytics, consumers will increase their spending on SMS and MMS by 2.5 percent in 2012.

That will reverse in 2013, as mobile service providers globally will see a 12 percent fall in global consumer spending on operator messaging revenue over the "next five years," Strategy Analytics predicts.

The decline in messaging revenue will be more pronounced in regions with the greatest penetration of smartphones and data users, like North America and Western Europe, where SMS and MMS expenditure will decline by 18 percent and almost 25 percent, respectively. 

Growth in U.S. text message volume fell to nine percent in 2011, significantly down from 30 percent in 2010. In 2011 both T-Mobile USA and Verizon Wireless noted low single digit growth in total messaging revenue, Strategy Analytics says. 

"While RCS and RCS-e enables mobile operators both to evolve mobile messaging beyond SMS and MMS and keep operators relevant in mobile messaging, it will not offset the current decline in messaging revenue," says David MacQueen, Strategy Analytics director.

"We forecast that by 2017, 293 million users of RCS/ RCS-e based services will generate $370 million in revenue for mobile operators," he says.