Print

Comment

Email

Digg

Del.icio.us

Reddit

A few months ago, the GSM world celebrated its first mobile multimedia service (MMS) century when the hundredth GSM network launched the MMS service. MMS service now spans 47 countries.

The first one was Telenor of Norway which did it not so long ago, in March 2002. And India is not far behind. Leading Indian GSM players announced GPRS-based launches for ‘updates via MMS’ to catch the cricket euphoria during the World Cup. Instead of getting just the scores, fans could see the way the game progressed, hear commentary and even view a slow-motion video clip replay of a catch or the boundary—just by punching a few buttons on their 2.5G GPRS mobile phones.

Beyond SMS
SMS has been in existence now for over 10 years now, and with 793 million GSM subscribers worldwide, an average of one SMS per day is sent by each subscriber. As per Forrester Research, 12 percent of all revenues of European mobile operators came from SMS as of April 2002. In fact, the monthly average of 156 million SMS messages in Europe in 2002 is expected to jump to 11.5 billion messages by 2004, though the prices will continue to fall. Forrester predicts that SMS revenue in Europe will decline from 19.6 billion euro in 2003 to 11.8 billion euro by 2007. In Asia, Chinese mobile operators saw 16.9 billion SMS messages sent last year. In India, the non-voice revenue of key mobile operators is believed to be around 5 percent. However, given the declining trends in the pricing of voice calls, this percentage is bound to go up. It is now natural for operators to look for alternate revenue sources as the voice calls stand very close to the costs, thus putting increasing pressure on the bottom lines. And MMS seems to stand out with its speed-to-market as 20 percent of all networks with SMS already offer MMS and many more are MMS-ready.

MMS Is Next Big Opportunity
MMS is the new messaging service that allows mobile data services to move from today’s largely text-based services to a rich multimedia environment, by exchanging voice, text, and images as well as video applications between mobile and—ultimately fixed—terminals.

According to Frost & Sullivan, "MMS is expected to account for 66.3 percent of all mobile messaging revenues (excluding e-mail) in 2006." However, the lack of interoperability continues to stifle MMS market growth. With this improving by the next year, MMS usage and service revenues are expected to take off. MMS is expected to generate 35 percent of total mobile data revenue in Western Europe by 2007, and would be reaching $14.3 billion per year by then. In this time frame, 70 percent of MMS revenues will come from person-to-person messaging, 27 percent from entertainment, and 3 percent from information services.

Migrating from SMS to MMS
Photo messaging is becoming popular with the introduction of handsets with built-in cameras, and offers excellent revenue and profit opportunities. However, in view of continuing importance of SMS, one cannot afford to lose sight of the basic text messaging which is going to be around for a long time.

Also, messaging from MMS handsets back to SMS users without MMS-capable handsets will also provide significant revenue streams. While we target the market segments with these latest phones that can send and receive multimedia-based mobile picture cards with full color, animation, and sound, we should also offer appropriate variations for legacy handsets, ensuring that those revenue streams are not lost. One can enable users to change plain text messages into unique and amusing visual/animated forms.

Challenges before MMS
Over 30 countries are believed to have more than one operator offering MMS services, the success of which will depend upon MMS interoperability—the key issue to be tackled next year. In order to fully reap this lucrative opportunity and tap the revenues, we have to ensure that MMS does not just remain a technology hype. The high cost of GPRS handsets makes it today an elite service—the European operators do subsidize: earlier GPRS phones and now 3G. The vendors and the operators need to address this together. Equally important is the issue of appropriate content creation. Billing would also be an important issue.

Page(s)   1