Michael Kowalzik, CEO, tyntec, asks whether SMS is likely to decline due to the rise of smartphone and mobile internet.

Recent statistics, from Portio Research, has suggested that the rise of smartphones and the mobile internet will mean a gradual decline for the importance of SMS as a communications tool. It claims that alternative technologies, such as mobile email and mobile IM, will supersede SMS as the text-based, person-to-person communications tool of choice.

However, this research seems based on a very one-dimensional view of mobile, with competing communications mechanisms fighting it out in a zero-sum game for dominance. What if this wasn’t the case? What if the rise of one technology didn’t cause the decline of another, but instead brought about additive growth?

I for one believe in the latter scenario. It is true that formats such as email and IM are rising in popularity as smartphones become more ubiquitous, but I also see this being as much of an opportunity for SMS as it is a threat.

Whilst one form of SMS usage, such as P2P communication, might become part of a broader mix of formats, other applications for the technology, such as A2P or over the top communications, can rise to take that place.

One reason that I hold this view is the basic power of SMS as a communications tool. It is, like voice, a universal mobile service meaning that it works on all devices and is generally understood by the vast majority of mobile users. 

SMS also benefits from its ability to operate across the most basic mobile networks and minimum levels of mobile coverage. The GSM and equivalent networks that support SMS are nearly ubiquitous globally, particularly when compared to the still patchy 3G and 4G coverage that services such as mobile IM and instant messaging rely upon.

Both of these mean that SMS will continue to have a role as a communications mechanism. Whilst smartphones are indeed increasing penetration, they are far from ubiquitous. At the same time, to enable such internet-based technologies the network connectivity has to be present, which is so far lacking. As such mobile email and IM are still a long way from claiming universal interoperability and so SMS will need to remain in place as a core communications tool.

However these are arguments only for the survival of SMS, not for it to thrive. One area where I believe growth will come is in the incorporation of SMS into rich mobile and fixed line internet services. Whilst P2P communications has been the core driver of growth over the history of SMS, A2P/P2A SMS from internet services has the potential to create a new wave of growth.

SMS can deliver real value for online services. As an instantaneous, two-way, ‘must read’ messaging format, SMS is the ideal vehicle for alerts and updates direct to and from the mobile phone. When combined with its ability to serve customers who either don’t have smartphones or are out of range of 3G coverage, the potential for growth is clear.

This might come in the form of SMS updates to and from a social network, letting you update and stay up to date with your friends. They might be alerts from or update to your online calendar. They might even be to or from a deals service telling you of cut-price offers in your area or letting you register for them.

This potential of SMS as an integral part of online services is, I believe, going to be a key driver for growth in the technology over the coming years. However, none of this is to say that pure P2P use cases are excluded by the rise of smartphones and ubiquitous data connectivity. There are already a number of over-the-top cloud communications packages that use SMS as a core part of their functionality.

For example, Pinger, a free voice and SMS app for iOS and Android, has sent more than 1.6 billion SMS messages each month for its consumers in the US alone. SMS is similarly integrated in services like Skype and Google Voice, showing how, even in a purely IP world, SMS still has a P2P growth potential above and beyond its traditional market.

The next question is how this integration between the web and telecom worlds will be enabled. Whilst SMS (and voice) are easy-to-integrate tools, providing these services in an international manner and handling the various regulations and technicalities means a new layer of complexity for internet companies.

This complexity often led these businesses to ignore the potential of mobile voice and SMS, or at least to limit mobile services to a few major territories. Now, however, there are providers that are integrating and aggregating SMS and mobile voice connectivity for internet businesses on a global basis.

Using these services, internet businesses can now globally mobile-enable their offerings through a single technical and commercial interface in the same way as they would with any other IP-based platform. This promises to be the breakthrough development that will usher in the next era of SMS growth.

info@tyntec.com

tyntec is a global mobile & SMS interaction service provider, offering high-quality mobile messaging services covering 600+ networks in 190 countries.

To read mobile^SQUARED's view on the SMS market, figures projected by Portio Research, click  here.