Two major research firms have attempted to put a dollar figure on the impact that OTT messaging apps are having on traditional telco SMS revenue.
Ovum is predicting that global SMS and MMS revenue will peak at $166.5 billion in 2016, and start to decline after that year.
This would represent a 4% growth rate for SMS/MMS revenues between 2013 and 2017 – downright anaemic compared to the rapid growth of social messaging services. By comparison, Ovum said, Line's revenue grew 46% sequentially in 3Q13 to $193 million.
SMS traffic is expected to peak even earlier – reaching a high of 7.8 trillion messages in 2014, but then starting to decline as subscribers shift to data-based rather than SMS-based plans.
Ovum estimates that social messaging will cause $32.6 billion in lost telco messaging revenue this year alone.
Informa Telecoms and Media meanwhile projects that global SMS revenues will fall to $96.7 billion by 2018, down by $23 billion from the projected $120 billion this year.
Asia-Pacific will be hardest hit by the slump, with revenues expected to fall from $45.8 billion this year to $38 billion in 2018. In China alone, annual SMS revenues are forecast to fall from $25.4 billion to $19.6 billion over the period.
But in markets with a higher proportion of postpaid subscribers, Informa said, operators will be able to somewhat mitigate the losses by offering unlimited SMS bundles.
In Korea for example, SMS revenues are expected to decline by just a 3.5% CAGR to $2.1 billion in 2018, despite the popularity of Kakao Talk in the market.