While a growing number of mobile players are tapping into SMS via messaging applications, it remains to be seen what kind of impact these moves will have on carriers and marketers.

There has been a lot of news in the messaging space lately, Facebook, Apple, Skype and others have introduced free messaging apps. However, because these services typically work within a confined network their impact on the space may be limited.

?Theoretically, this is a threat for carriers,? said Jeff Hasen, chief marketing officer of Hipcricket, Seattle.

?In practice, they likely won?t take meaningful revenue away from the carriers,? he said. ?I see mobile subscribers having both standard text messaging plans and a group app.?

App-to-person messaging
By offering free messaging, Facebook Messenger, Apple?s iMessage, as well as existing services such as BlackBerry Messenger and Yahoo Messenger hope to capture a piece of the substantial text messaging market.

Revenue from app-to-person SMS will exceed $70 billion by 2016, according to recent research from Juniper Research. App-to-person messaging is attractive to a wide number of users, including financial services, advertising and marketing, the report says.

However, despite this growth, traditional SMS will continue to play a strong role for marketers.

?These services are used, but because you can reach anyone with SMS, it is just a lot easier to use,? said Daniel Ashdown, research analyst at Juniper Research, Hampshire, Britain. ?SMS is integrated into the user interface on a phone, you don?t have to log on to use it ? it is better integrated into everyday usage.

?One of the things you have to remember about these messaging services is that they are very much closed networks,? he said. ?With SMS you can send a message to anyone in the world if you have their number.?

SMS? reach includes feature phones, of which there are still many in circulation. Smartphones that use apps are growing quickly, but currently only account for one-third of the mobile phone market worldwide, per Mr. Ashdown.

For marketers, the ubiquitous nature of SMS is very important because brands know their messaging will reach practically the entire intended audience. It may also offer superior personalization capabilities.

?Savvy marketers like Macy?s, MillerCoors and others use text messaging for both reach and to build a one-to-one relationship that has valuable remarketing opportunities,? Hipcricket's Mr. Hasen said.

?The mere idea of a group app eliminates the means to personalize communication and offers,? he said. ?Marketers are succeeding through relevant exchanges, not group messages that can feel like impersonal blasts of information.?

Free messaging apps are likely to be best for reaching smaller groups of customers.

?I see these apps as niche at best,? Mr. Hasen said.

?Text messaging is cross-carrier, works on virtually all devices, and has reach to virtually all mobile subscribers,? he said. ?These apps? reach is limited to the community that they manage to build.?

SMS revenue peaking
The impact for carriers is that users may choose to send a message via one of these services instead of sending a text message directly from their phone, resulting in lower revenues from SMS.

However, texting revenue is already declining due to the maturity of the market while the impact of messaging apps is likely to be minimal. 

Revenue from person-to-person SMS, or texting, will peak in a number of regions between 2010 and 2016, according to Juniper Research. During this time, the valuation of texting will reach a low point due to competitive pricing, particularly for prepaid message buckets.

?SMS is a very mature market and we are expecting total global SMS revenues to peak between 2010 and 2016 but not because of the threat of over-the-top services,? Mr. Ashdown said.

?It is more a case of the maturity of the services and price compression,? he said.

Contributing factors to the declining prices for SMS include the growth of smartphones. Users of these devices often sign up for more expensive all-inclusive plans that include unlimited texting, per Mr. Ashdown.

Free messaging services also contribute to the devaluation of SMS by underscoring the idea that consumers do not have to pay for texting.

For the moment, carriers are likely to be watching the trend in free messaging apps before taking any actions.

?The carriers are wisely watching without being heavy-handed,? Mr. Hasen said.

?They could attempt to prevent these apps from running on their networks, but they have enough litigation to worry about that they don?t need more,? he said.

Final Take
Chantal Tode is associate editor on Mobile Marketer, New York