Will Chat Apps Kill SMS Texting?

According to a recent report, texting on chat apps like WhatsApp has surpassed SMS texts. Almost 19 billion texts were sent on chat apps per day compared to 17.6 billion SMS texts in 2012 globally. This should not come as a surprise to anyone, as the number of smartphone users is growing exponentially, including in India.

There are about 40 million Smartphone users (Nielsen, 2012) in India, 10 per cent of the total pie. This has fueled the growth of chat apps, as the data tariffs have also come down significantly in the last couple of years. Chat apps are a major improvement over SMS texting as they offer far more features (option to send images and audio-video files, group chat, hundreds of emoticons, etc.) and also cut down the cost of texting.

The first chat app that truly caught the fancy of Indian users was BBM, Research In Motion’s proprietary service for Blackberry phones. But BBM has been rubbed off of its shine as WhatsApp has gained in popularity. Compared to single-platform BMM and Apple iOS’s iMessage, WhatsApp is a cross-platform service, and this has been its main reason of success, along with its robust messaging platform.

WhatsApp, an American product, first introduced its services in 2009 and soon emerged as the top texting app. This year it crossed 200 million users, apparently more than Twitter (in number of active users). Though the numbers of its Indian users are not available, it can be safely said that it leads the pack here too. Though not popular in India, some of the other apps such as Kakao Talk (South Korea), Line (Japan) and WeChat (China) have also managed to garner millions of users in a short span of time.

But this comes as a bad news to telecom service providers, as SMS texts traditionally have been a major part of their non-voice revenues. However, carriers like Reliance Communications and Airtel have understood that it is better to adapt to the new reality than fight it. Reliance has tied up with WhatsApp to offer an exclusive plan to its users, while Bharati Airtel has developed a chat app of its own called Hike, in partnership with Softbank of Japan.

India is a highly under-saturated market as far as penetration of smartphones is concerned. The next frontier for its growth is lower strata of urban population, small towns and villages. As the number of internet-enabled smartphones increases, so will the adoption of chat apps. So it is no one’s guess that it’s only downhill for SMS texting henceforth.

-By Tejas Harad

12 thoughts on “Will Chat Apps Kill SMS Texting?

  1. I think in a country like India where technology adoption among the masses is slow and infrastructure in rural areas is poor, SMS will continue to dominate as a messaging channel. Apps like Whatsapp require a Wifi or GPRS/3G connection as well as a phone that can make use of it, both more prevalent in urban locales than rural India.

    That said, given the fact that brands like Micromax, Lava and Karbonn are designing low cost smartphones for the Indian market, I do see eventual scope for such apps over a 5-10 year period.

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