How Long Until "Peak Text Messaging Revenue?"

In 2013, text messaging is  expected to generate in excess of $130 billion worth of service revenue for mobile service providers, with profit margins as much as 90 percent.

But whether 2013 turns out to be the peak year for messaging revenue, or whether that happens in 2014 or 2015, the peak is coming shortly.

The Global Mobile Consumer Survey predicts global text messaging revenues are expected to continue growing until at least 2015, reaching a peak of $159 billion.

Also, the study suggests, the relationship between text messaging and instant or social messaging is a bit subtle. In developed markets, there is a strong inverse correlation between instant messaging penetration and text messaging usage.

In markets where text messaging historically has been lightly used, social messaging usage is high. In Spain, for example, a typical subscriber sends just seven text messages a month, over the top messaging penetration and usage is high.

In France, where over the top messaging penetration is just 15 percent, an average subscriber

sends more than 250 texts per month.  In other countries, there is no clear correlation between

use of text messaging and use of over the top messaging.

In Germany, both text messaging and instant messaging are growing.

So what should carriers do about over the top substitutes for text messaging? As usual, the advice is to “reassess their analysis of and relationship with OTT.”

“Specifically, they should consider how to better monetize the growing popularity of IM, as part of a broad and growing suite of messaging solutions,” Deloitte says. Some mobile carriers have begun exposing network and data assets to OTT apps using application program interfaces,  allowing third parties to integrate their applications and services more closely with the

mobile device, subscriber information module and elements of the network.

That recommendation is fine, so long as the third parties agree to do so, see value and are willing to pay something for the privilege that the mobile carrier finds acceptable.

Some approaches involve supplying in-app advertising or billing services. Deloitte suggests unlimited use of instant messaging also will be popular with many users, and that service packages can be crafted to supply such access.

At the same time, carriers should work to add value to text messaging, which will remain a substantial business for some time.