Two years ago, Indians used to send 9 SMS per day but in the month of July, 2013, only 2 SMS per day were sent!
In a recent survey by Nielson, India, it was revealed that mobile chat applications such as Nimbuzz and WhatsApp have literally destroyed the SMS culture and usage inside India. Powered by internet, these applications are prompting Indians to ditch SMS which normally costs Re 1 to Rs 1.5 for local numbers and as high as Rs 5 for international numbers.
On the other hand, the mobile chat applications are absolutely free to use and as a result, on an average, Indians are using these apps for 27 minutes a day.
This trend is not a one-off case. Researchers and trend watchers have observed this phenomenon to occur in USA and China as well. Famous chat applications in China such as Weibo and WeChat have triggered massive downfall in SMS usage in cities such as Beijing where the per capita SMS usage has fallen to 36 from 42 a year ago. And the trend is continuing…
[Source: Nielsen Mobile Insights]
Facing the downfall of SMS usage, Indian telecom companies are facing the heat as well.
As observed, Bharti Airtel’s June quarter results for 2013 showed that the revenues from SMS usage have come down to 8.2%, compared to nearly 11%, a year ago. But in the same period, Airltel’s revenue from data usage (Internet consumption) increased to staggering 90% if compared to last year. See the chart that shows a clear comparison!
Similarly, Idea Cellular is also getting less revenue from SMS as compared to previous years, but its revenues from Internet usage is at all time high. Its 3G Data revenue per user has increased by Rs 20 and currently it’s at Rs 109 in the June quarter, which is exponential growth in terms of Indian market.
Not only SMS, but Voice usage trends of Indians will also give jitters to telecom companies. Two years ago, an average Indian used to make 5 calls a day and in July, 2013, the figure remains the same. This means that although telecom companies have added more subscribers, the voice usage is the same.
Services which use Voice over Internet (VoIP) makes calling to any person in the world almost free. And the new and informed smart phone user from India is smart enough to know which services to use to keep his monthly billing low.
Gartner India has already predicted that revenues from SMS would slowly extinct in Asia and rest of the world in coming years.
I suppose that the time is ripe for telecom companies to look out for alternate revenue streams to counter this SMS void. And I hope that a higher data charge is not the option which they are thinking!
What is your view on this? Do you actively use SMS today as you used earlier? Will you miss SMS if telecom companies decide to shut down this service? Share your views here!