Global Trend

The Surge in Text Messaging

Mobile phones that can send and receive text messages have finally reached critical mass in the United States. Some 90 percent of the nearly 200 million phones in the U.S. now have that capability. As one CEO put it, the cell phone has become “the third screen” in people’s lives, after the TV and the PC.

Today, two-thirds of American households have at least one mobile phone, according to Forrester Research, and the number of households with four or more mobile phones has grown by 57 percent in the past year.

The number of text messages sent in the U.S. has nearly tripled over the past two years, from 14.3 billion in 2003 to an estimated 38 billion in 2005. Forresterpredicts that by 2009, 82 billion messages will be sent.

But the U.S. isn’t even close to achieving the usage levels of many countries in Europe and Asia. For example, in a single month ? January, 2004 ? China’s 500 million cell phone users sent more than 15 billion text messages, a 91 percent annualized increase over the previous year, according to an article in China View.

In part, this trend is the result of innovative uses for the medium. For example, people can now use text messaging for everything from appointment reminders to getting weather or traffic updates and even news of the latest celebrity gossip.

On a more serious note, text messages may be the main way of communicating during a crisis. According to the Orlando Sentinal, during the recent subway bomb attacks in London, cell phone networks were overloaded and didn’t work. Even land lines failed. That’s when people discovered that text messaging, which uses much less bandwidth, was still working and allowed survivors and family members to contact each other.

One reason text messages work even in a crisis is that they use a part of the network that doesn’t carry voices, only data. No matter how many people are trying to talk, there’s still that bandwidth available. For another thing, the messages are short, and unlike voices, demand very little in the way of bandwidth.

Moreover, they don’t require a continuous connection and can be broken up and sent in packets as free bandwidth is found. With voice, callers simply aren’t connected if there’s no room. A text message will wait in line to be delivered. This is also important, because during an emergency, wireless operators give part of their voice capacity over to emergency agencies and exclude ordinary subscribers. But text messaging still works.

Another factor in the exploding popularity of text messaging is a technological one: Until now, the various cell phone networks weren’t compatible with one another. A text message from a Sprint phone couldn’t be sent to a Cingular phone, and vice versa. But while the American cell phone companies still aren’t talking to one another, a company called Mobile 365 can translate messages and forward them from one network to another. It is already handling 2 million messages a month that way.

Based on this trend, we offer these six forecasts:

First, text messaging is set to explode on numerous fronts. With Internet and telecommunications merging, expect to see a host of on-demand user services appear to fill this growing need. For example, with cell phones equipped with GPS, a user could type in a request to find the nearest five-star hotel or restaurant and receive an instant message including several choices, telephone numbers with automatic connect options, addresses, and even a moving map display powered by the GPS to guide the user to the destination.

Second, the surge in text messaging ? and features like the one just described ? are just early reminders that the concept of the telephone is changing, especially for wireless models like cell phones. Today the telephone is already a far more versatile tool that includes sending, storing, and receiving information of every type. And this will only continue to expand and evolve.

Third, the popularity of text messaging will expand the cell phone user base to the point that services such as TV by phone will become economically feasible. Already Sony, Motorola, and startups like Varsity Media in Austin, Texas, are working to provide video to cell phone screens. Within the next five years, regular broadcasts of news, weather, and sports will be available on cell phones as well.

Fourth, text-messaging services will be targeted primarily to teens and young adults for the next five years. With 33 million teens in the U.S. generating $400 billion in consumer demand, advertisers are looking for ways to exploit text messaging including newer services that guide spending. Among wireless users, more than 50 percent of teens under the age of 18, and 75 percent of users aged 18 to 24 have used text messaging at least once during the last six months, according to Jupiter Research. But only 38 percent of adults with cell phones sent text messages. As with all such technological advances, text messaging will move up into the mainstream as the industry matures, and revenues will rise as a result.

Fifth, big returns will be generated by the firms that solve the interoperability problem. For the wireless carriers, text messaging revenues will hit $3.5 billion in 2005, according to Forrester Research. By 2009, the revenues will grow to $5.7 billion. Any company that can translate between existing technologies so that any cell phone can reach any other cell phone in the world transparently will capture a large share of the market for instant communications. As connected as our world is today, there is still a gap in low-cost, convenient, globe-spanning communications technologies, and low-bandwidth text messaging represents an obvious opportunity in that area.

Sixth, text messaging will increasingly become the emergency channel of choice, not only for individuals but even for agencies in times of true crisis. Also, because text is much easier to encrypt than voice, it may well be the only secure channel under certain circumstances. Anyone wanting to make it through a terrorist event or a natural disaster such as Hurricane Katrina will include a text-capable phone in his or her survival kit.

References List :
1. USA Today, July 27, 2005, “Common in Asia, Text Messaging Via Cellphone Catches On in USA,” by Kevin Maney. ⓒ Copyright 2005 by USA Today, a division of Gannett Company, Inc. All rights reserved. 2. For information on U.S. mobile phone growth, visit the Forrester Research website at:www.forrester.com/ER/Press/Release/0,1769,998.00.html 3. China View, February 27, 2004, “Text Messages Rise 91% in Past Year,” by Sophie Beach. ⓒ Copyright 2004 by Xinhua News Agency. All rights reserved. 4. Orlando Sentinal, September 18, 2005, “Text Messaging Can Provide Vital Link,” by Chris Cobbs. ⓒ Copyright 2005 by Orlando Sentinal Communications. All rights reserved. 5. Asbury Park Press, June 12, 2005, “Get the Message?” by David P. Willis. ⓒ Copyright 2005 by Asbury Park Press. All rights reserved. 6. ibid.