Instant Messaging Eating Into SMS Text Messaging

from the but-of-course... dept

The old “accepted wisdom” was that folks in Europe communicated via SMS text messaging, while folks in the US were mainly doing internet-based instant messaging. There were a variety of reasons for why things developed this way, but it was a generally accurate statement for a while. However, even early on, some of us began wondering what would happen as the two worlds started to merge. That is, as mobile phones became more powerful and acted more like handheld computers, wouldn’t users start to realize that instant messaging would save them a lot of money in terms of data costs. Especially with advanced phones like the iPhone, it seemed inevitable that “expensive” SMS would start to run into trouble. And, in fact, that appears to be happening. A new study in the UK (where SMS text messaging is huge) has shown that, as people start using instant messaging applications, their use of SMS text messaging drops significantly. The one exception, by the way, is with older users, who are comfortable enough with SMS and don’t seem as interested in using IM on their phones. Either way, this has to be a concern for mobile operators who have a tendency to assume that high-priced services will always remain high-priced and in high demand.

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Comments on “Instant Messaging Eating Into SMS Text Messaging”

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Chris says:

Re: Re:

With an iPhone you can use Meebo for free and it will let you log into AIM, MSN Live, Yahoo! IM and Google Talk all at once. You can IM people on any of those for free. Add Twitter access to that and I can hardly think of a reason to text on an iPhone. No, I don’t work for Apple or Meebo or anything, just giving a tip!

JS Beckerist (profile) says:

Re: cell vs internet

My experience:
Cheapest cell phone plan (not prepaid): I’ve found a 500 minute Verizon family plan. 2 phones, unlimited texting, unlimited Verizon calls, unlimited nights and weekends: I pay $130 a month.
Cheapest internet plan: Currently we have 2 broadband options here, Time Warner Roadrunner and Verizon DSL. RR is $60 a month (which I have,) VDSL $40. I can find multiple sources for $10/$15 a month unlimited dialup.

Cheapest cell: My cousin pays 15 Euro (roughly $30) for a single cell phone, no texting but if he added it it’d be about another $5 a month. Even 2 phones means $70, and that’s not a “deal” by any means
Cheapest internet: My cousin HAS to pay for dialup as there are no other offerings. ~$55 a month, THEN he has to pay by Kb used (not sure of the rate, but everyone over there is scared to use it due to cost)

So in conclusion:
America: Internet cheap, Cell phones expensive
Germany: Cell phones cheap, Internet expensive

It only seems logical it evolved like that…

inc says:

I was doing this on my HTC8525 for a while. It’s great for all ur friends that have IM on their phone or that are online, but a lot of times SMS is more reliable. I don’t see why a full on voice conversation can end up costing less. I mean the cost to piggy back on little bits of text is like $10 or 10 cents each way. It’s excessive especially if one user is being charge to send the message and another to receive it as if they asked for it.

yo ho ho.... says:


SMS is actually managed outside of a carrier’s network and they pay a fraction of a cent for each SMS that gets routed to and from their network — which means there is a real cost associated with SMS for the carriers…

HOWEVER, it is almost nothing — which gives you an idea of what sort of margin they make on any fees they charge.

JS Beckerist (profile) says:

Re: txtmsg/IM

Sorry to double post in the same article, but I have to agree. I can sit on my network watching in plain text what people are sending via AIM*. I just read an article where it’s nearly impossible to retrieve texts. I can’t find the article now (just spent a few searching) but it was basically saying that in the event a crime was committed, if the perp used text messages it’s not easy to retrieve the texts, and that they are rarely stored for more than a few minutes, let alone days or weeks on any “central server.”

BTW: for you *nix users, check out Ethereal. It’s the tool I use to see AIM messages (handy if you have someone backpacking on your network and they happen to be…dumb)

Lawrence D'Oliveiro says:

Re: Re: Re: txtmsg/IM

You exchange keys and then your conversations are crypted. Our security guy was a little mad that he couldn’t sniff my IMs…

I wonder how long it’ll take him to figure out how to commit a man-in-the-middle attack on you? After all, how do you know who you’re exchanging keys with … ?

brandon (user link) says:

Re: Re: RE: txtmsg/IM

Hey JS, there have been a few high profile scenarios of when text messages have been retreived from the carrier database. Most messages are stored for months at a time and can be accessed by law enforcement. Take for example Kwami Kilpatrick, the Detroit City mayor, whose case revolves around sent and received sms.

marek says:

Texting isn't expensive - and it's growing not shrinking

I think the premise of this piece is just plain wrong – at least as far as the UK is concerned. Whatever the relative underlying costs of mobile telephony and internet access, the critical thing is the marginal cost. In the UK, for SMS, that is zero for everybody I know – and unsurprisingly, I see no sign of usage falling – on the contrary industry figures show it continuing to grow rapidly, with 40% year on year growth.

The figures in the report cited are about all messaging – from computers as well as phones. It’s not clear what might be driving the changing proportionate shares of messaging types, but it certainly isn’t the collapse of SMS.

kerry ritz (user link) says:

IM vs Text

The main reason driving limited IM use on mobile has been the poor usability of main IM clients which are not optimised for mobile. In addition, there is no integrated approach to IM which allows a customer to consolidate its buddies into one list and to communicate across all platforms–both mobile and desktop. Until now that is: that is what Palringo does better than any other client. It’s more usable and more effective and cost effective than text messaging and adds both a voice and picture messaging capability that is not done by any other application. So check out



Dave Beck (profile) says:

SMS is "store and forward" not "instant"

Seems to me that the fundamental difference is that SMS is a “store and forward” system. If you want to contact or provide info, an address for example, then SMS is simple and quick. When the recipient is off-line the SMS waits until they are alive again. You could call and leave voicemail, a pain in the a**, or you could constantly watch your IM contact list and wait for the contact to come on-line (assumes you really haven’t got a life). With SMS it’s fire and forget and you can send to a list of recipients just as easily as one. No contest.

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