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Wireless carriers negatively impacted by mobile messaging apps: study

One third of mobile carriers are experiencing declines in traffic and revenue as a result of mobile messaging applications such as Skype, according to new research from Mavenir Systems and MobileSquared. 

The report takes a look at over-the-top chat and voice-over-IP applications such as Skype, iMessage, Facebook Message and Google Talk that are often free to use and determines their impact on traditional operator-based SMS and voice services. In addition to some carriers already seeing a financial impact from these apps, three-quarters of carriers report being worried about losing revenue to this new group of mobile app providers.

?Mobile carriers have known about this trend but the news really is that consistently, revenues are actually starting to be impacted now,? said Maryvonne Tubb, director of global marketing for Mavenir Systems, Richardson, TX.

?The biggest revelation was the extent to which global mobile carriers are consistent in their assessment of the marketplace with 70 percent of carriers predicting traffic will decline further over the next 5-10 years because of the use of OTT clients, while more than 65 percent expect to see revenues decline as well,? she said.

Taking on the competition
Over the next five to 10 years, 32.3 percent of respondents expect carrier traffic from messaging, voice and video calling will decline between 11 and 20 percent. An additional 20 percent expect traffic to decline between 31 and 40 percent as a result these over-the-top apps.

The negative impact of mobile messaging apps is not likely to improve for carriers without changes to operator services and business models.

To address the growing competition with mobile messaging apps, carriers are moving towards an all-IP converged core network with an eye on offering rich communication services, according to the report.

?Voice and text are carriers? core income,? said Gavin Patterson, chief markets analyst for MobileSquared, Berkshire Britain. ?They will obviously have to attempt to stem the flow and the research concludes that the only way to do this is to actually compete with OTT providers by offering RCSe or RCSe type services to try and keep traffic on their network.?

The goal of these efforts by carriers to improve their networks is to enable users to place high-definition voice and video calls, chat, share content and discover new services as part of a globally connected framework.

The expectation is that this will help carriers retain and grow their share of customer communication spend.

The report found that 42 percent of carriers say that they will roll-out IP Multimedia Subsystem based services to offer rich communication services and VoLTE. 

However, 45 percent of carriers think that other similar technologies would enable a quicker route to market.

?Over 45 percent of survey respondents agreed that RCSe services - offering phone-number based services such as enhanced address book, rich call for video and file sharing, and rich messaging for instant messaging across all mobile networks - would help prevent network-based traffic moving off network to OTT IM clients on smartphones,? Ms. Tubb said.

The survey of 31 carriers was conducted in September and the first half of October. Respondents were based in Europe, North America, Asia, and the Middle East and Africa.

?Carriers are investing in the future with advanced strategies and messaging solutions implementing unique capabilities such as phone-number based applications,? Ms. Tubb said. ?But, in order for mobile carriers to be the number one-stop-shop for mobile services, they need to act now.?

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