The evolution of messaging

Since the advent of SMS messaging two decades ago, this method of communication has become a solid revenue stream for operators with over 350m SMS messages sent every day in the UK alone[1]. More recently, the rapid adoption of smartphones and the increasing demand for mobile data – which soared fortyfold in the three years leading up to 2010[1] – means a new platform has been created for ‘always-on’ instant messaging. Mobile operators are already experiencing and acknowledging a change in consumer needs with the development of high-speed, 4G networks that will enable and facilitate VoIP[2]. They will also need to brace themselves for a shift in demand towards the enhanced experience provided by mobile instant messaging services.

Voice over IP (VoIP) has gained significant momentum in recent years and now has a prominent place in the mobile ecosystem, forcing mobile network providers to take a different stance towards this technology.

The changing bargaining power

While mobile voice still remains the cash cow for network carriers, in the EU in particularly there are signs of stagnation and growth is now primarily driven by data revenues and the sales of Smartphones. The need to upgrade text and voice users to Smartphones and data plan deals has shifted the balance of power amongst the forces that define the competitive landscape in the mobile sector.