New research from Deloitte shows the number of text messages sent in the U.K. during 2013 was “way down on previous years.”

The advisory firm’s latest technology predictions report revealed the number of SMS messages sent in the UK fell for the first time last year, as people increasingly turn to instant messaging services like WhatsApp, Viber and Snapchat to stay in touch.

“Its research shows 145 billion SMS text messages were sent in 2013, a drop of seven billion on the previous year,” ITPro reports. “Furthermore, the company said it expects this downturn to continue this year and that just 140 billion will be exchanged over the next 12 months.”

What’s true in the U.K., however, is also true in the U.S. and the world at large.

On Tuesday, Mobile Marketing Watch affirmed that global expenditure on operator messaging services, which includes SMS and MMS, declined for the first time in 2013 following its peak in 2012.

The revised Global Mobile Messaging Forecast from Strategy Analytics reveals that operator revenue from messaging services fell by almost 4 percent last year to just below $104 Billion.

“Continued intense competition for subscribers between operators combined with the fast growing popularity of over-the-top instant messaging services like WhatsApp, Line Messenger and Tencent’s WeChat will drive a  20 percent fall in global operator messaging revenue by 2017,” Strategy Analytics projects.

The post SMS for Marketing, Consumer Use on Opposite Roads in the U.K. appeared first on Mobile Marketing Watch.

Think about it, what other industry or company do you know of that charges you for service every month but you cannot start using the service for 4 months? Go ahead, I will give you a few minutes, please add your comments below. Can’t think of any? It’s because if a company like this existed, nobody would want to do business with them, and they wouldn’t be around for very long.

However if you have a monopoly on the space and people really needed your service to grow their business, they wouldn’t have a choice. For mobile marketers this may sound like familiar territory. We all know that mobile marketing through a short code is ultimately the best way to go. I’m not sold on QR codes yet as the user experience isn’t that great.

I’ve been at the helm of mobileStorm, a top mobile marketing company since 1999, even before short codes really existed (and yes this link is strategically placed for SEO goodness). There was really one aggregator back then, Simplewire, and if you didn’t use them to send SMS messages via SMPP (Short Message Peer-to-Peer Protocol), then you sent your messages via SMTP (Simple Mail Transfer Protocol) which is how email is sent. However, everyone knows that sending SMS messages this way is unreliable and doesn’t offer much in the way of analytics and reporting. I can’t remember when it happened but at one point Neustar, founded in 1996 to meet the technical and operational challenges that arose when the U.S. Government mandated local number portability, and the CTIA, the all-powerful carrier association, got together to create USShortcodes.com. USShortcodes was, and still is, the only service that would allow you to lease a 5 or 6 digit short code that either meant something (a.k.a. vanity short code), or was completely random (a.k.a. random short code). Two major events in the U.S. taught Americans how to text in to a short code. The first was American Idol, where you could vote for Sanjaya by simply texting VOTE to 4701, and the second was Barak Obama’s VP candidate announcement of Joe Biden via his vanity short code 62262, which spells OBAMA. The latest statistics from Pew show that 80% of Americans send text messages, with billions being sent on a daily basis. To say SMS is mainstream is an understatement.

SMS is a brilliant way to engage with potential customers and retain existing ones. Response rates dwarf other channels like email, IVR and direct mail. The average SMS is read within 4 minutes. If you’re still not convinced about the power of SMS, think about how it’s disrupting healthcare. Our client Kaiser Permanente proved they could reduce the number of no-shows by sending SMS appointment reminders. They saved close to $275k in 30 days at one facility. SMS is helping pregnant moms through pregnancy, smokers to quit smoking, and keeping those with Diabetes adherent to their medication.

So why does Neustar and the carriers make it so difficult to do business with them? Wouldn’t you think a technology that improves peoples’ lives, and has 80% of Americans engaged, could be as simple as buying a domain name? If I went to Godaddy.com and registered a domain name, it would cost me $10 for the year and I would immediately get to start using it. With USShortcodes, it costs me anywhere from $1,500 – $3,000 for the quarter depending on if I license a random or vanity code. Going back to my opening sentence, the average wait time to get your short code approved is around 4 months, and guess what; you’re paying for that code even though you can’t use it. Most people would consider this a scam, but this is how things are done and you don’t have a choice in the matter. If you want to do SMS right, you need a short code.

At mobileStorm, we spend hundreds of thousands of dollars per year with USShortcodes.com because SMS is a wonderful channel — but it doesn’t mean we love the experience. The cost of the codes, the time it takes to get them working, and the audits performed each month with the “guilty before being proven innocent” method is beyond frustrating. I really can’t think of another industry that makes it so difficult to do business, other than maybe complying with city code when trying to build an addition onto your house.

Each code is hand approved by someone at the carrier, and they have a pile of applications sitting on their desk. When they go to test your workflow, if your application doesn’t match it seems as if you go to the bottom of the pile. Oh I almost forgot, you can’t talk to the carrier either, you have to work with your aggregator, so it becomes a game of telephone.

Recently Verizon wanted a client of ours to indemnify them of any litigation that would arise from their SMS program. Are you kidding me? How is SMS supposed to be the killer app in healthcare if the carriers demand indemnification clauses on a short code?

The system is completely inefficient. Let’s recap:

1. It’s expensive: Small businesses cannot afford the cost of a short code. Most have to resort to a shared code. But oh yeah, there’s rumblings that USShortcodes wants to do away with that as well. Soon most companies in the U.S. will not be able to use SMS. It’s as if the industry is forcing people towards QR codes.
2. The time to market seems like an inside joke, but it’s not:  If your business is built on top of SMS and you need to wait 4 months to get your business going, you might as well stop everything you’re doing and wait for the code to be approved. Just don’t pay any attention to the stat that most businesses fail within the first year, because you only have 8 months left.
3. The cost of doing business is high: The CTIA spends millions of dollars a year on independent auditing firms. Their entire goal is to find SMS programs that do not follow the original workflow and shut them down because spam is such a huge problem with SMS. Can you hear the irony in my voice? Think about email. Now think about how many unwanted SMS messages you get. Is there even a comparison? Keeping spam out is one thing the carriers did right. Unlike email they control the pipe and can shut someone down quickly. So if it’s not spam, why the audits? It must be the lawsuits they don’t want to be involved in right? When you get an audit, you have to stop what you are doing and respond. To say this disrupts your business is an understatement. Imagine having to manage and audit 20 clients. Now imagine trying to find every single location these clients have ever promoted their short code and add some copy that would further indemnify the carriers from a lawsuit. Our friends over at TextPower wrote a great article on this called “It’s Official: Cellular Carriers Have Gone Nuts.” Audits are nightmares that take important employee resources away from other revenue generating activities, like helping a client understand how to properly build and market to their database. It’s as if the carriers are looking for ways not to do business with you.
4. It feels like a scam, but supposedly it’s not: Why do we need to pay to license the code when it is not usable? Can someone please answer this for me? Now is your chance to tell the industry why they pay for a service they can’t use. If you give us a good reason we’ll forgive you, but we want our money back for the years we spent on codes we couldn’t use.

It almost feels to me like the carriers don’t want to provide short codes, but they have to. Why else would they make it timely, expensive, and wasteful?

There’s something else that doesn’t sit well with me. The carriers should be a lot less worried about the small businesses that occasionally send a coupon to their customers, and a lot more worried that legitimate companies are being sued because they were following the MMA’s consumer best practice guidelines. Let me repeat that, businesses are being sued for millions of dollars because they followed consumer best practices, as set forth by the MMA (and the guidelines were created with the carries input as well). I would laugh, but I feel bad. Sounds like these companies were just trying to do the right thing. Soundbite Communications, Redbox, and American Express were just a few of the companies blessed with lawsuits for sending a confirmation message to consumers after they’d opted out of their SMS program. These companies were sued under the Telephone Consumer Protection Act (TCPA) because they sent someone a message confirming an opt-out. This is a classic “damned if you do and damned if you don’t” situation. If they send the message they are sued, if they don’t send the message the carriers will audit them and shut down their short code. Oh the joy!

On April 5th and April 9^th of this year, two mobile marketing companies (Eztexting out of New York, and TextPower out of Los Angeles), filed punitive class action antitrust lawsuits in the Southern District of New York against the country’s major wireless carriers, the CTIA trade association, and various text-message (or Short Message Service) aggregators.

I know the CEOs of both companies and for years we’ve discussed how the squeeze is becoming more like a choke. In short, these entrepreneurs reached their breaking points and decided to fight back. All eyes right now are on these lawsuits. Will they bring the change needed to reverse the industry’s biggest problems? Or will they be crushed by the unlimited funds of the powerful association?

I personally don’t think the parties involved (the CTIA, Neustar and USShortcodes) are evil, I just don’t think they have a very good process for how things work and it’s too expensive for them to go back and fix anything. Maybe they don’t see this as that big of a revenue stream, even though it’s reported that the CSC industry brings in  roughly $2.3 billion a year in revenue.  Hey Neustar, spend 1% of this revenue and create a fully automated approval system. This would bring the cost of short codes down and get businesses up and running in the same day. Don’t you think SMS marketing would at least double in size?

My hope is that these lawsuits will wake someone up over there that has the power to bring swift and immediate change. If we continue down the path we’re on, businesses will be forced elsewhere; and we already see it happening. Push notifications and in-app messaging are already threatening SMS usage.

This is a warning to the carriers — if you guys don’t make changes necessary to make mobile marketing more attractive, you will lose billions in revenue a lot sooner. This isn’t a threat, it’s a fact. We know how much money SMS brings in revenue so I understand the need to protect it, but you’re guarding it the wrong way. The security team at Fort Knox isn’t packing squirt guns.

Please make marketers happy again about sending SMS. If you make it cheap, easy and free like the Internet is supposed to be, then you have a shot at the 88 million small businesses in America. I know we’ll need to add a couple more numbers to the short code, and maybe they’ll need to be called medium codes, but hey, that would be considered a good thing right?

The post Short Codes are a Scam, and SMS Marketing is Dying. Is there Hope? appeared first on Mobile Marketing Watch.

According to Portio, MMS – launched after the initial success of SMS to deliver multimedia content – has until recently been the second greatest revenue generating non-voice service, after SMS.

Last year, roughly $31 billion of the worldwide mobile messaging market’s $202 billion came from MMS.

Such a demonstrable pedigree over the years has made it all the more baffling as to why such a valuable service never shook the industry misconception that it was a failure.

“With the dawn of more advanced technologies like 3G and accelerating smartphone penetration, MMS growth has now started showing signs of slowing down,” says John White of Portio Research. “Amongst various benefits of faster Internet speeds, the combination of smartphones and 3G has extended the novel idea of multimedia file sharing with appropriate simplicity.”

Portio’s forecasts show that MMS will generate revenues of $183.2 billion over the years 2012-2016.

“That is still a very sizable chunk of cash,” White says, “so let’s not write MMS off yet.”

The post Study Projects MMS to Generate $180 Billion Between 2012-2016 appeared first on Mobile Marketing Watch.

According to the latest data and corresponding insights from Nielsen, U.S. teenagers have tripled their mobile data usage in the last year – all while remaining kings and queens of texting.

Messaging remains the centerpiece of mobile teen behavior in the U.S. The number of messages exchanged (SMS and MMS) hit 3,417 messages per month per teen in Q3 2011, averaging seven messages per waking hour. Teen females are leading the charge, sending and receiving 3,952 messages per month versus 2,815 from males.

Aside from messaging, Nielsen announced, data heavy activities such as mobile internet, social networking, email, app downloads, and app usage are the most popular mobile activities.

“Teenagers have officially joined the data tsunami,” the report reads, “more than tripling their mobile data consumption in the past year while maintaining their stronghold as the leading message senders.”

Using recent data from monthly cell phone bills of 65,000+ mobile subscribers who volunteered to participate in the research, Nielsen has analyzed mobile usage trends among teens in the United States. In the third quarter of 2011, teens aged 13-17 used an average of 320 MB of data per month on their phones, up 256 percent over last year and growing at a rate faster than any other age group. Much of this activity is driven by teen males, who took in 382 MB per month while females used 266 MB.

“The explosion in data usage is being driven by an increase in the popularity of media-rich activities – like music, video and the use of apps – which themselves are being fueled by higher smartphone penetration,” says Nielsen managing director Telecom Europe, David Gosen. “As data usage increases, operators need to work out how to maintain the speed and quality of their service and how to charge appropriately. In the US, different operators have tried different options, from tiered data plans to actively targeting consumers who use the most data. Customer segmentation will become increasingly important for operators, as the pressures on profitability challenge the viability of all-you-can-eat data plans.”

Is the information above truly a revelation about American teens, or a no-brainer reality that will probably grow more pronounced over the next twelve months?

The post Mobile Data Usage Among Teenagers Triples Year Over Year appeared first on Mobile Marketing Watch.

Juniper speculates that the continued growth will be driven by the arrival of new services (Apple’s iMessage is cited as one example), and the accelerated adoption of existing services like AOL’s AIM, Blackberry Messenger, Microsoft’s Windows Live, Skype and Yahoo! Messenger.

The launch of these free Mobile IM services has been facilitated by the increasing number of smartphones in use, low-cost data packages and the development of high speed mobile networks. While some IM services are ad-funded, most are viewed by the operators as customer retention tools, with the only cost to the user being the data usage charged.

Juniper, however, sees no sign of Mobile IM services replacing SMS as a primary means of text communication on mobile handsets.

“SMS has one distinct advantage over ‘over-the-top’ services: its ubiquity,” writes Mobile Messaging Markets Report author Daniel Ashdown. “With an SMS I know I can reach almost any handset in the world, if I have its number. While IM services have some advantages, such as real-time communication and apparent absence of cost, the market is fragmented by different services which cannot communicate with each other.”

Juniper’s research also led to projections that premium-rate SMS and MMS will decline due to challenges from other forms of billing and delivery. MMS traffic and revenue, on the other hand, will continue to grow, but Application-to-Person (A2P) MMS will not have as big of an impact as A2P SMS. Lastly, Juniper finds that mobile email adoption will likely persist as the number of handsets with QWERTY keyboards, Internet access and larger screens increase.

To read the full Mobile Messaging Markets Report from Juniper, click here.

The post Juniper Research Projects Mobile IM Users will Grow But Not Threaten SMS Dominance appeared first on Mobile Marketing Watch.

We’ve covered Blyk’s evolution from the beginning.  The company started out as an MVNO with a unique proposition.  Targeted at younger consumers, Blyk’s original business model offered free wireless airtime and mobile messaging in exchange for highly-targeted text messages.  A user would signup for Blyk’s service, outline their interests and what companies they’d like to see ads for, and then Blyk would serve up relevant SMS marketing messages based on that profile.  The more ads a user was willing to receive, the more free airtime and mobile messages they’d receive in return.

This model didn’t end up working out for the company, and in 2009, they entered the partnership with Orange and evolved into the entity it is today.  As the primary provider of relevant SMS marketing for Orange subscribers, Blyk has had huge success the last couple of years by connecting brands with relevant subscribers through “Orange Shots.”  In addition, the company recently raised a massive €17 million round of financing, which works out to a little over $24M.  Though it had a rough start, Blyk has settled nicely into its role as a leading provider of operator-based mobile marketing solutions.

The post Blyk Extends Partnership With UK Operator Orange, Takes On Mobile Marketing Initiatives appeared first on Mobile Marketing Watch.

Created by the MMA’s “Mobile Couponing Task Force,” the document is designed to provide marketers, merchants, wireless carriers and other mobile marketing ecosystem members with an industry-standard for using mobile coupons and rebates to increase sales and promote consumer loyalty.

Though mobile coupons are the focus of the new guidelines, the MMA sees them as only one piece of the puzzle in relation to mobile price promotions — which the MMA defines as “electronic coupons or rebates that traverse the full redemption process without the requirement for conversion into a paper or other hard-copy format.”

Mobile Price Promotions are distributed, discovered and redeemed through a variety of mobile technologies, including SMS, MMS, Mobile Apps, Mobile Web, Bluetooth, NFC and 1D/2D barcode scanning.  The new guidelines provide a “concise overview of these channels, as well as the key considerations for developing and executing these types of campaigns:”

• The five stages of mobile price promotions, such as the ways that consumers can discover and redeem coupons and rebates.
• General best practices and principles, including transparency, good taste, privacy, opt-in/opt-out and government laws, rules and regulations.
• Campaign-specific best practices and principles, such as those involving contests, food, pharmaceuticals and alcohol.
• Tips for designing coupons, using the word “free” and creating notices such as terms and conditions.

“Our research shows that consumer interest in mobile coupons continues to grow, giving brands, merchants and marketers a powerful new opportunity to establish and maintain relationships with consumers,” said Greg Stuart, CEO of MMA. “The MMA created ‘Guidelines and Best Practices in Mobile Price Promotions’ to give the ecosystem an industry-standard framework for capitalizing on that opportunity while protecting the consumer experience.”

The post MMA Publishes Updated Best Practices & Guidelines For Mobile Coupons & Rebates appeared first on Mobile Marketing Watch.

Launched just 16 months ago with roughly 50 brands, O2 has found a winning strategy by adhering to strict user-privacy rules and maintaining high relevance with the messages it sends.  First off, the service only sends one SMS message per day, and the user explicitly details what kind of products and services they’re interested in upon sign up.  In addition, every single SMS contains an opt-out capability, so the customer can cancel O2 More at any time.

This is a big deal for a couple reasons.  This is the first large-scale attempt by a wireless operator to capitalize on the power of mobile marketing combined with a massive subscriber-base.  Also, it represents the immense success a service like this can be, if done properly.  We’ll no doubt see other operators follow suit in the near future.

“O2 More was created to give our customers what they really want,” said Shaun Gregory, Managing Director of O2 Media.  “Breaking through two million customers shows that we’re delivering on that promise.  What’s more, we’re delivering new highly-targeted, relevant and effective forms of communication for brands. Mobile messaging is the only way that brands can open up a unique one-to-one dialogue with customers and create real engagement. O2 More is all about creating an exciting customer and advertiser experience, backed up by one of the UKs most respected brands.”

The post O2’s SMS Opt-In Service Reaches 2 Million Subscribers And Over 1,000 Advertisers appeared first on Mobile Marketing Watch.

Zoove Mobile

The primary difference between StarStar codes and short codes are that the former are much less costly to obtain and can be setup in a matter of minutes rather than a matter of weeks or months.  StarStar codes were originally offered by Verizon Wireless and AT&T, but the company is today announcing integration with Sprint and T-Mobile as well.  The technology offers numerous advantages over SMS short codes, but also some disadvantages as well.

With StarStar Numbers, such as “**BRAND (**27263),” consumers simply call the StarStar Number of the brand being promoted or advertised.  Instantly, that brand’s mobile app, Web page, coupon, videos or more can be pushed directly to their mobile phones —  without the need to use 2D-bar code readers or cross-carrier text messaging short codes.  Still, calls-to-action featuring StarStar codes aren’t as memorable or as eye-catching as the tried and true “text this keyword into this short code” mindset.

With its services now offered on all four major U.S. operators, Zoove is on the right track to make its new codes viable in the mobile marketing industry, but it’s a steep hill to climb with short codes being so well ingrained in consumer behavior.  “More and more of our customers are seeking simple but immersive interactions with their favorite brands,” said Brad Duea, senior vice president, value added services, T-Mobile USA. “At the same time, brands with mobile assets need an easy mechanism to reach consumers’ phone screens.  Zoove’s StarStar Numbers are a compelling and intuitive way to meet the needs of our customers and the brands they love.”

The post Zoove Goes Cross-Carrier With Its “StarStar Codes,” Adds Support For Sprint & T-Mobile appeared first on Mobile Marketing Watch.

The study found that 90 percent of smartphone users send at least one text message per day, compared to only 40 percent of smartphone users who utilize social networks like Twitter and Facebook at least once per day.  Despite several claims that text messaging is on the decline, being surpassed by mobile email and social networking, it seems the opposite is true and SMS still reigns supreme.

The study goes on to say that SMS is still so popular because they’re more immediate and more personal than any other form of mobile communication.  “A common perception is that the text message has been usurped by mobile email, which in turn is being displaced by social networks,” said Paul Lee, head of telecoms and technology research at Deloitte.  “Yet, there still appears to be plenty of life left in the humble text message.  The intensity of usage of text messages remains high.”  More than three out of 10 of those aged between 18 and 24 send at least one text message every hour, the research found, and that doesn’t even include children and teenagers who send even more than that.

The post Study: SMS Still Way More Popular Than Social Networking For Mobile Users appeared first on Mobile Marketing Watch.