Friday, March 2, 2012

Mobile carriers face a future without text messaging as data apps take over

Mobile phone with text message

Endangered species? A mobile phone with a text message.

Just past the safety gate for the world's largest mobile trade exhibition in Barcelona, executives of huge mobile carriers could not avoid walking past a booth they'd in all probability rather not have seen: it had been for "Pinger," alittle California company that gives free texting within the US and Germany and has world growth plans.


Pinger, at the side of an explosion of smartphone messaging services like Apple iMessage, RIM's BlackBerry Messenger, the cross-platform WhatsApp, Viber Press, Myspace Messenger and KakaoTalk, have managed in barely a number of years to slash away at the vital revenue that mobile firms get from text messaging. Worse still, analysts say there is not any finish in sight to the monetary bloodletting.

The rival messaging services work by giving applications that permit phone users chat for complimentary on the carriers' information networks or Wi-Fi. Some, like Pinger, create cash from advertisements and work on computers furthermore.

Ovum, a hunt firm primarily based in London, estimates the telecoms firms lost nearly £9bn last year in text-messaging revenue as customers migrated to applications that permit them send messages over mobile information networks.

Ovum said the businesses still took in an estimated £95.4bn, however that was down Sept. 11 from a year earlier, and Pinger co-founder Joe Stipher desires to cut back the number even a lot of.
Free as in free

"Text messaging is free, and calling goes to be free," said Stipher, sporting jeans that contrasted with the dark suits favoured by thousands of mobile company executives attending the four-day 2012 Mobile World Congress that finished Friday. "Data goes to be like electrical power or water, not totally free, however does one worry regarding giving somebody a glass of water at your home or letting them connect in? No."

Needless to mention, mobile firms don't seem to be happy at the flood of free messaging services piggybacking on their networks. Telecom Italia chief government Franco Bernabe told MWC that free messaging services are undercutting the power of phone firms to speculate in their systems. Paid text messaging, or SMS, has been a money cow for phone firms that uses minimal network capability.

The new players "have primarily based their innovation within the mobile domain, while not a deep understanding of the complicated technical surroundings of our trade. this is often increasingly making important issues to the service offered to the tip user and driving extra investments for cellular employees," Bernabe said.

After years of study, the large telecommunications operators announced on that they're going to attempt to fight back by introducing software this year embedded in new mobile phones that may permit users to try and do a similar variety of internet-based messaging and voice calls that buyers wish, while not paying separate fees.
Joyn in

The new messaging methodology introduced by the trade cluster GSMA (Groupe Speciale Mobile Association), is dubbed "Joyn" and can be launched this year by operators in France, Germany, Italy and South Korea. A take a look at "beta" version was released on to Spanish shoppers of Vodafone with smartphones running Google's Android software. In trade parlance, the applying is thought as "Rich Marketing and sales communications Package," or RCS.

Joyn tries to cope with one major shortcoming of messaging apps: each the sender and also the recipient ought to use a similar app. to this point that has been text messaging's saving grace, because it works across phone models, networks, and even continents. however it isn't clear whether or not RCS can work on each phone. Apple, for instance, features a long history of not taking part in by mobile company rules, and also the operators said of Joyn that "nine out of 10 major device manufacturers have finalized up". Most believe that The apple company is that the missing one - and it's a major player within the fast-growing smartphone market.

"Since wealthy Communications (Suite) are absolutely integrated in devices, there's no would like for our customers to download or set up something," said Rene Obermann, primary government of Germany's Deutsche Telekom. "Ease of use is therefore guaranteed and it will simply work. we have a tendency to are trying forward to supply new services like text chat, file and live video sharing throughout a decision to our customers soon."

But analysts say there is not any manner of knowing whether or not customers can migrate to Joyn till once it's released in an exceedingly full launch to customers, and note that mobile operators' last major technological advance came within the Nineteen Nineties – which was text messaging. Also, mobile phones sold by carriers usually come back loaded with software that a lot of individuals rarely or never use as a result of they do not like them.

"It is feasible this may be [operators'] last probability to check if they'll play a lot of of a task," said Pamela Clark-Dickson, an analyst at London's Informa Telecoms & Media research group. "The person experience is essential, and if they do not get it right individuals will not use it."
Smart pipes?

The GSMA did not say how operators can charge for Joyn or what quantity. and also the carriers face an uphill battle denting the recognition of the free messaging services. WhatsApp chief government officer Jan Koum told the mobile congress that its users are currently sending quite 2bn messages per day, up from 1bn in October. The abundant smaller Pinger saw its users send 2bn mail messages in Jan, up from 1.7bn in Dec, Sipher said, adding that mobile operators ought to keep aloof from free messaging as a result of "they are not sensible at it and haven't done applications."

He explained that "The carriers ought to be sensible, reliable pipes" providing net information access like utilities provide reliable water and electrical power, he said. "They have to need to concentrate on being sensible network operators."

Obermann said carriers are at an important purpose at that they have to "develop our own, innovative product suites" through cooperation with the smaller messaging firms.
"The sensible tube are one in all the places where (telecommunications companies) can show their innovation," he said.

His company's venture investment category, T-Venture, took a share in Pinger last week simply before the MWC conference began, asserting it might give $7.5m in venture capital to assist Pinger grow around the world, particularly in Europe.

For Sipher, it is a sign that some operators understand they have to figure with messaging startups rather than against them.

"We're saying to the telecoms that we're here, we're big, and we're taking part in," Sipher said. "When's the last time a carrier introduced a successful application? that will be SMS and that is virtually fifteen years ago."

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