Some years back, Christmas sales of ebooks overshot “real” books for the first time. Epitaphs followed. But fresher doses of technology, say flipkart, seemed to infuse new life into purchase of books.
Having survived 500 years of technological upheaval, Gutenberg’s invention continues to confront existentialist questions. last month, data released by Bowker Market Research showed that in 2012, for the first time ever, online channels have accounted for more book purchases than bricks-and-mortar retail in the US.
I’m all for renewed consensus that there’s something about a crisply printed, tightly bound book that millions of us won’t let go of; but it’s a foregone conclusion that India won’t behave very different for too long. The winds of change are here, dodging Udyog Bhawan’s blockage on foreign investment into e-retailing.
New data, this time on SMS, shows how Jurassic Park is closer to another bastion than most of us are so used to. As folks at Informa, a telecom and media consultancy, claimed this week, in 2012 almost 19 billion messages have been sent on daily basis, out numbering 17.6 billion SMS texts. This is the first time that SMS has been pipped.
I’m glad over this and gladder still to see numbers released by another consulting firm, Ovum. More than $23bn of SMS revenue was “lost”. Bravo! More power to the smart phone, for it alone allows internet–connected devices to now constitute a share of 85 per cent and 79 per cent in the U.S and UK.
India can’t remain far behind. In some markets the smart phone has already outdone feature phones in terms of shipments.
That said, and despite the rise of WhatsApp, the best advertised nemesis of the SMS, the latter will still dominate mobile messaging traffic and revenues to 2016. Revenues are under pressure, but as Informa tells us, mobile operators will still generate a total of $722.7 billion in revenues from SMS between 2011 and 2016.
Indeed, the penetration of smart phones (read Samsung!) and mobile broadband will decide to what extent substitution occurs in markets like India and at what speed.
So, is SMS deadIJ Far from it. Even as Informa predicts either slowing growth or even a small decline in person-to-person SMS revenues in some developed regions and countries, total global SMS revenues will rise at a compound annual growth rate of 3 per cent over the next five years. And if you thought SMS is for laggards, western Europe is expected to generate the highest amount of SMS revenues globally between 2011 and 2016, ie, $174.1 billion. That’s ahead of Asia Pacific Developing, where revenues will total $173.8 billion.
In fact, SMS traffic might even shoot up! Informa forecasts that there shall be 9.4 trillion SMS flying around by 2016 (read cheaper SMS) compared to 5.9 trillion messages in 2011. That said, SMS’s share of global mobile messaging traffic will fall from 64 per cent in 2011 to 42 per cent in 2016.
Put in another way, the global mobile instant messaging traffic will increase from 1.6 trillion messages in 2011 to 7.7 trillion messages in 2016, doubling its share of global messaging traffic from 17.1 per cent in 2011 to 34.6 per cent in 2016.
The upshot is obvious. Social messaging apps are more avant garde, but there are still a large number of us suckers-for-SMS still out there! This isn’t of course, the reason why Sunil Mittal is buying costly networks in obscure markets like Uganda. I was passing through hundreds of Airtel kiosks between Entebbe and Kampala when the deal was announced last week. My hosts didn’t care all that much about SMS or WhatsApp. Mittal’s merger of Warid with Airtel “mobile Money” seemed to drive them.
Poser: Is SMS vs. WhatsApp even the right question, when the real slugfest might be among the mobile phone and the bankIJ
(The columnist is CEO & Co-Founder, India Strategy Group, Hammurabi & Solomon Consulting. Tweets @therohitbansal).