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SMS was an accidental success that took nearly everyone in the mobile
industry by surprise. Few people predicted that this hard of use service would
take off. There was hardly any promotion for or mention of SMS by network
operators until after SMS started to be a success. SMS advertising went from
showing business people in suits entering text messages to bright pink and
yellow advertisements aimed at the youth markets that adopted SMS.
SMS was the triumph of the consumer- every generation needs a technology that
it can adopt as its own to communicate with- and the text generation took up SMS.
Paradoxically, it was because SMS was so very difficult to use that the young
people said that they were going to overcome the man machine interface and other
issues and use the service anyway. The fact that the entry barriers to learning
the service were so high were an advantage because it meant that parents and
teachers and other adult authority figures were unlikely and unable and
unwilling to be able to use the service.
SMS is one of the few services in consumer history that has grown very fast
without corresponding decreases in pricing. Usually- even in the case of voice
mobile phones- price reductions in the cost of the phones and phone service have
led to increases in usage. Whilst these factors have helped to bring younger
people into the mobile market, the price of SMS itself stayed steady because the
networks were having trouble handling the volumes of messages being sent and
dared not reduce prices.
A whole new alphabet emerged because SMS messages took a long time to enter
and were quite abrupt as people attempted to say as much as possible with as few
keystrokes. Abbreviations such as “C U L8er” for “See you later” sprung
up for timesaving and coolness. The use of “smileys” to reduce the
abruptness of the medium and to help indicate the mood of the person in a way
that was difficult with just text became popular.
The introduction of prepay mobile tariffs in which people could pay for their
airtime in advance and thereby control their mobile phone expenditure was the
catalyst that accelerated the take up of SMS. The network operators were unable
technically to bill prepay customers for the SMS they were using because the
links between the prepay platform and the billing system and the SMS Centers
were not in place. The network operators responded with silence- the prepay
literature did not mention SMS at all even though the prepay phones supported
the service. One thing that is certain is that in these days with the Internet
revolution to spread information, the young people will identify loopholes like
this. And they did. Suddenly, millions more SMS messages were being sent- with
some individual mobile phone subscriptions accounting for thousands of SMS per
month alone as they set up automated message generators. Network operators
worked with their platform suppliers to try and sort this out and implement
charging for SMS for prepay customers. Meanwhile SMS incubated and spread and
people were using it because it cost nothing whereas carrying out the same
transaction using voice clearly did cost. Eventually after a few months the
network operators finally got their act together and managed to implement SMS
charging for prepay users- such that they could decrement the prepay credit by
the cost of an SMS message
A mass SMS message distribution campaign was then typically sent out- such
that everyone that had used SMS received a text message informing them that from
a certain date, SMS would be charged for. This led to an immediate and
protracted decline in SMS usage to between 25% and 40% of the pre-charging
levels as people suddenly stopped using SMS or using it as much. Then something
interesting happened- the volume of SMS messages started gradually increasing
again and soon reached its pre-charging levels. SMS volume growth has continued
its upward growth ever since, fueled by simple person to person messaging as
people told each other how they were feeling and what they were doing-
information services and other operator led initiatives failed to interest the
user community to any degree and never have done. Whilst it was free, SMS had
become an important part of the way that young people communicated with each
other in their daily life. SMS would have taken off without this prepay factor
because it was already being used before that time- but it would never have
taken off as quickly.
SMS growth continued its astonishing growth during the year 2000 in Europe, a
period of time when the mobile industry was trying to dictate the deployment of
WAP. Despite doing nearly nothing else of any benefit, WAP did at least increase
the attention that the mobile Internet received as people tried to work out
services that would appeal to the mobile phone users. Those companies that
survived the WAP debacle started to realize that it was SMS and not WAP that had
the addressable audience of users and the clearer business case. Advertising and
other services based on SMS started to be trialed as companies realized that
people who could use SMS for person to person messaging would also be able to
access SMS based commercial messages.
The next great success for SMS based services was ringtones. Nokia had
started its smart messaging protocol that was built on binary SMS rather than
the standard text SMS. Nokia had expected this technology to be used for
information services and over the air service profiling and it had languished
for years, until suddenly in the year 2000, it found its application- ringtones
that allow users to change the way their mobile phone rang. Because the network
operators were woefully inadequate and unable to offer the ringtone suppliers
fair and flexible revenue sharing, the service providers started using premium
rate Interactive Voice Response (IVR) voice platforms to trigger the
transmission of ringtones. The ringtones market soon became a billion dollar
market- and few of the network operators even offered services- this category
was dominated by independent service providers who advertised in newspapers and
magazines.
