iMessage sends a warning to telcos

Summary:Just two weeks into owning a new iPhone 4S, iMessage has severely reduced the volume of SMSes I send, but will Australian telcos care?

Just two weeks into owning a new iPhone 4S, iMessage has severely reduced the volume of SMSes I send, but will Australian telcos care?

iMessage

(Credit: Apple)

The cross-device iMessage service included in the release of iOS 5 is one of the more sneaky encroachments on traditional telco territory over the past few years. Its seamless integration into the regular SMS service means that more often than not, you don't notice whether you're sending a message using the traditional carrier SMS service or via the data network using iMessage. The only way to tell is that iMessages are in blue speech bubbles, while normal text messages are in green.

It's really a case of set and forget. I don't have to know in advance if someone I'm messaging has iMessage, or not, the app figures that out for me. If I'm not in an area with adequate data coverage? That's fine, it'll go by SMS instead. Prior to this, I did use alternatives such as WhatsApp or through Facebook messaging, but it just doesn't compare.

The cross-device application means I can see the message history on either my iPad or iPhone and there's no risk of losing previous messages if I ever need to get them back. In two weeks, I would estimate it's halved the amount of SMSes I would send through traditional means.

But I wonder if that is all bad news for telcos.

In the US, AT&T responded to the announcement of iMessage by removing all options on plans except either a US$20 per month for unlimited messages or 20 cents per message. The idea being that customers would either have to opt to pay the higher cost or just pay a higher price per individual text message.

According to the The Sydney Morning Herald, people on Telstra sent 9.9 billion text messages last year. Based on Telstra's customer numbers, I'd estimate that to be close to 850 messages per mobile.

It sounds like a lot to give up, but I don't predict that Aussie telcos will be worried about all its SMS revenue declining any time soon. For one simple reason: unlimited SMS plans.

A cursory glance at the plans available on all three major mobile telcos will show that a good portion of the plans come with unlimited SMSes within Australia. There are some plans that charge 25 cents per text on a cap, but pretty much all of the current iPhone plans out there come with some form of unlimited text.

All this means is that customers in Australia will be forfeiting their free SMS to move over and use their capped data plans for messages. Although I seriously doubt that the amount of data used in iMessage would chew through an entire monthly data quota on its own, it's still more worthwhile for the telcos to have their customers send messages using data that is anything but "unlimited".

But more than anything, iMessage is just a warning sign for mobile network operators. It shows, as Vodafone noted yesterday, that Apple is not the friend of mobile operators. While the Cupertino company is happy to use your network, anything after that is fair game. It wouldn't be too much of a stretch to consider that Apple's next target will be voice, meaning mobile operators will find themselves in a situation where they are little more than a mobile internet provider.

Topics: Apple, iPhone, Telcos

About

Armed with a degree in Computer Science and a Masters in Journalism, Josh keeps a close eye on the telecommunications industry, the National Broadband Network, and all the goings on in government IT.

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