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Messaging Apps Took $13.9 Billion from Carriers in 2011

According to the survey results released, the volume of IP-based social text messages sent in 2010 was equal to $8.7 billion in text messaging services offered by cellular providers. In 2011, that number jumped to $13.9 billion that carriers may have lost.

Ovum analysts conclude that text messaging has been on the decline, down 6 percent in 2010 and down 9 percent in 2011. Given the popularity of text messaging as well as the high profitability nature of text messages for carriers, providers are facing a problem and they need to update their legacy services if they do not want to lose their footing in the messaging market, Ovum said.

“Social messaging has disrupted traditional services, and operators’ revenues in this area will come under increasing pressure,” says Neha Dharia, consumer analyst at Ovum. “Tapping into the creativity of app developers, forming industry-wide collaborations, and leveraging their usage data and strong relationships with subscribers are the key ways for operators to ensure that they hold their ground in the messaging market.”

However, Dharia noted that it may already be too late for carriers to save their messaging infrastructure. Rather than competing with other carriers they would have to realize that they are competing with Internet services and will have to work together with developers, handset makers and other carriers to come up with innovative and attractive new messaging services. The carriers' advantage remains the fact that they remain in control of the data network and billing framework, which enables them to set the rules of the game and determine "to a great extent the services to which the user is exposed,” the analyst said.

Have you turned to alternative messaging means such as the built-in iMessage or BBM? Or do you go cross-platform with Whatsapp?