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SMS Cash Cow Continues Slow Decline
Though Foreign Markets Are Witnessing Trend First
As we've frequently covered, SMS is a huge cash cow for carriers as it costs virtually nothing for a carrier to provide. As the SMS cash cow slowly dies, they're getting their pound of flesh one way or another -- by either jacking up data rates -- or making your SMS options fewer and more costly. Other data has suggested the cash SMS cash cow won't truly start to die until after 2015 or so, but that fate is being accelerated by applications like Skype and iMessage. As erosion accelerates, SMS usage declines are popping up first in early adoption foreign markets:
quote:
Signs of consumers moving on from text-messaging to social media, email and IP-based messaging systems started cropping up in 2011 in advanced SMS markets like Netherlands and Philippines. What we seem to be witnessing is a situation where those countries where SMS took off first during Nineties are now the first ones to see a steep decline in SMS usage.
What's happening first in other early adoption countries will hit carriers like AT&T and Verizon next year and in 2013. Both companies anticipated this, which is why they were among the first to eliminate unlimited data. This attempt to revenue counter-balance is something that will likely force Sprint off of their position of selling unlimited data for smartphones sometime in the next two years.
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KrK
Heavy Artillery For The Little Guy
Premium Member
join:2000-01-17
Tulsa, OK
Netgear WNDR3700v2
Zoom 5341J

KrK

Premium Member

Unfortunately.... as consumers find ways to save money...

...by going around these fees, the providers, unrestrained by proper competition, and wanting to keep investors happy and their stock options golden by always growing profit, will simply move this lost revenue to other charges--- ie expensive data plans, caps, overages, or etc.

What happens is consumers find way to save money, and the companies, due to lack of competition, find ways to take more money still. It's grand.
25139889 (banned)
join:2011-10-25
Toledo, OH

25139889 (banned)

Member

Re: Unfortunately.... as consumers find ways to save money...

no they won't use caps- they'll go back to the old it comes from your minute plans.

KrK
Heavy Artillery For The Little Guy
Premium Member
join:2000-01-17
Tulsa, OK

KrK

Premium Member

Re: Unfortunately.... as consumers find ways to save money...

Per byte billing, since you can use the same apps on Smartphones to make calls--- no voice minutes needed.
KrK

KrK

Premium Member

Re: Unfortunately.... as consumers find ways to save money...

Wait till they start charging you for data traffic that goes over your own Wi-Fi connection.

Who wants to take the bet.... Charges coming for using your phone over your own Wi-Fi. This is additional and on top of the data charges from your ISP for using data (your Wi-Fi).
openbox9
Premium Member
join:2004-01-26
71144

openbox9

Premium Member

Re: Unfortunately.... as consumers find ways to save money...

Already doing it...femtocells

As for finding other revenue generating means, that won't change. I can't think if any business that willingly reduces revenue.

KrK
Heavy Artillery For The Little Guy
Premium Member
join:2000-01-17
Tulsa, OK

KrK

Premium Member

Re: Unfortunately.... as consumers find ways to save money...

Finding revenue sources to me equates to finding new products and services consumers are willing to pay for. Not finding new "creative" ways to charge more and take more while providing less and doing less, just because they can.
KrK

KrK to openbox9

Premium Member

to openbox9
I used to be interested in Femtocells but they've been largely obsoleted now by Wi-Fi. I don't need one at all because I can use my phone and other devices via Wi-Fi and make voice calls via Wi-Fi as well, so there's no longer a need for a Femtocell.

djdanska
Rudie32
Premium Member
join:2001-04-21
San Diego, CA

djdanska to KrK

Premium Member

to KrK
said by KrK:

Wait till they start charging you for data traffic that goes over your own Wi-Fi connection.

Who wants to take the bet.... Charges coming for using your phone over your own Wi-Fi. This is additional and on top of the data charges from your ISP for using data (your Wi-Fi).

thankfully my provider (T-Mobile) gave me a free addon which gives me unlimited free calls over any wifi signal. Works great!

KrK
Heavy Artillery For The Little Guy
Premium Member
join:2000-01-17
Tulsa, OK

KrK

Premium Member

Re: Unfortunately.... as consumers find ways to save money...

Yeah, they recently pushed out Wi-Fi calling to many phones via updates.

Juggernaut
Irreverent or irrelevant?
Premium Member
join:2006-09-05
Kelowna, BC

Juggernaut to djdanska

Premium Member

to djdanska
said by djdanska:

thankfully my provider (T-Mobile) gave me a free addon which gives me unlimited free calls over any wifi signal. Works great!

It wasn't because they decided to be nice. They get to take load off their network, and put it elsewhere; your ISP's, and your net cap if you have one.
MrHappy316
Wish I had my tank
Premium Member
join:2003-01-02
Columbia, SC

MrHappy316 to KrK

Premium Member

to KrK
T-Mobile already does this if you are using prepaid
p51d007
Naa-P51d Mustang
join:2002-06-07
Springfield, MO

p51d007

Member

SMS FEE

Yep, they will figure a way to bilk us out of more.
Because we aren't using SMS as much, we'll incur a "sms non usage fee" LOL.

jtudor
MVM
join:2002-12-07
Morganton, NC

jtudor

MVM

Re: SMS FEE

said by p51d007:

Because we aren't using SMS as much, we'll incur a "sms non usage fee" LOL.

Just like the wireline carriers started charging you a fee for not using your long distance several years ago, to force customers into buying LD packages what we rarely used.

MIABye
Premium Member
join:2001-10-28
united state

MIABye

Premium Member

Suck It ATT!

I still have my $5 text message option, and I'll hang onto it until I switch to Sprint this summer.
HarryH3
Premium Member
join:2005-02-21

HarryH3

Premium Member

Lived a long time without SMS...

I seem to get along just fine without the never-ending stream of interruptions that I see others endure via SMS. I have it disabled. I can't understand the need to text every thought to someone (or to everyone, ala Twitter and Facebook). I guess it just means I'm old...

cork1958
Cork
Premium Member
join:2000-02-26

cork1958

Premium Member

Re: Lived a long time without SMS...

said by HarryH3:

I seem to get along just fine without the never-ending stream of interruptions that I see others endure via SMS. I have it disabled. I can't understand the need to text every thought to someone (or to everyone, ala Twitter and Facebook). I guess it just means I'm old...

Guess I'm as old as you then. Never once have I used messaging to plaster crap all over Facebook and all those worthless, socially diseased sites!
TheMG
Premium Member
join:2007-09-04
Canada
MikroTik RB450G
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TheMG to HarryH3

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to HarryH3
I've sent less than 10 SMS in my whole life.

In fact, I don't even own a cellphone. I just have a company cellphone that I use strictly for business purposes. When I'm off work I turn it off.

I don't have a Facebook account or any other social networking account for that matter.

I communicate through voice calls and emails.

Do I feel like I'm missing out? Not at all!

I must be old. Oh wait, scratch that, I'm 24.

Trimline
Premium Member
join:2004-10-24
Windermere, FL

Trimline

Premium Member

Article Title Might be Better Said

From : SMS Cash Cow Continues Slow Decline

To: SMS Cash Cow Continues Slow Death

Why folks continue to pay for something that can be had for free is beyond me. I would call my provider and ask for a no charge SMS. Boost, Virgin and a host of other providers do not charge for this service.

JohnInSJ
Premium Member
join:2003-09-22
Aptos, CA

JohnInSJ

Premium Member

ending unlimited data is tied to sms?

Really? I doubt that logic is sound.

How about this logic instead? In 2006, unlimited data on crap phones on Edge or first gen 1X CDMA could possibly eek out a couple hundred MB/mo. In 2007, the iPhone and late gen WinMo phones on Edge/3G/EVDO might be able to eek out a GB, or if tethered, much more (so the carriers killed tethering.)

In 2008-11, iOS/Android devices with HVGA or better displays capable of video, decent 3G modems capable of pulling full speeds, and other improvements, coupled with ready access to high bandwidth content, meant "unlimited data" could run into tens of GB of data. (The carriers killed unlimited data - except as a stunt to gain subs for VZ or as a last gasp to retain subs by Sprint or TMo)

I do expect the carriers (all of them) will make sure the average profit per sub remains constant (or increases) over time, since the carriers are all for-profit corporations and not nationalized government service providers.

This is capitalism. We love it, remember?

DataRiker
Premium Member
join:2002-05-19
00000

DataRiker

Premium Member

Re: ending unlimited data is tied to sms?

said by JohnInSJ:

This is capitalism. We love it, remember?

This is corporatism. Incumbent telecom's are one of the largest lobbyists of government. They also receive large sums of government cash (USF is a HUGE one )

And just as corporatism would suggest, we are stuck with few options that look remarkably similar.

To suggest its capitalism is just plain false.

As somebody who has been in Asia the fact that Americans pay hyper inflated rates is readily obvious.

Unlimited cellular coverage in Vietnam costs about 9 USD, and in South Korea it was about 20 bucks with unlimited calling, text, mobile TV, and a 10 gigabyte data allowance.

linicx
Caveat Emptor
Premium Member
join:2002-12-03
United State

linicx

Premium Member

Re: ending unlimited data is tied to sms?

Exactly. Which is why I am considering dumping Sprint and Verizon and going straight to Walmart. It is impossible to reason with these companies. Take Sprint for instance. I'm losing my vision and the phone I have is inadequate. Not only can I not change up, if I drop them as a carrier I can't switch back to Sprint for a year. Verizon and AT&T are worse. The corporate greed is driving customers elsewhere for no contract service like TracPhones, and Walmart that works across the US with no hassle, and unlimited data for $45.
BiggA
Premium Member
join:2005-11-23
Central CT

BiggA

Premium Member

No realistic replacement

There isn't a realistic replacement for SMS. Even if there eventually is a service that works as well (when you have decent data service), the carriers can always just make texting "free" and bump up the base costs of the plans.
negativeduck
Premium Member
join:2002-02-14
Centreville, VA

negativeduck

Premium Member

This is kinda funny

I keep getting emails from AT&T about how they want to save me money on my bill. So my line has the old $5 for 500 or 200 text's which is all I need. My Wife's line has nothing on it she hates sms but occasionally she uses it as a quick hello or I send her something random. All in All I may pay $1.50 every other month for her use of text messages.

Yet they keep offering to save me money by putting us in a $30 per month 10,000 text message plan. Someone is using some funky math here.

Newmanwell
@bellsouth.net

Newmanwell

Anon

Yahoo IM app

I have the yahoo IM app that has a SMS option that works pretty well.