Wireless carriers will need to look for new bread and butter. Companies like AT&T and Verizon Wireless are likely a bit uneasy in the face of the recent proliferation of instant messaging apps on smartphones and a glacial growth rate of text messaging volume. The phenomena could deal a serious blow to the wireless business, which has come to rely on the high profit margins of text messaging.
One could argue that the writing has been on the wall since the introduction of Research In Motion’s BlackBerry Messenger service. But it wasn’t until Apple recently released a similar product, iMessage, for its iPad and iPhone products that the death of the text message loomed large. Google’s Android software is also reportedly working on a messaging service that uses the Internet, instead of wireless carriers, for message delivery.
Tech consumers are crafty. Many have learned that by tapping into all of the apps the Internet has to offer, they can lower their monthly phone bills. Voice-over-Internet? There's an app for that. Messaging-over-Internet? There is now increasingly an app for that.
Cellphone users in the U.S. sent and received a whopping 1 trillion text messages in the second half of last year, but compared to the six months prior, the figure represents only extremely modest growth. Carriers charge anywhere from 20 cents per message to texting plans that carry price tags of around $20 a month. In comparison to monthly data plans and one-off data use charges, text messaging still reigns supreme in the profits department. The SMS cash-flow, however, may be short-lived.