Mobile messages in APAC to top 3.5T

Asia's 3.5 trillion will account for nearly half of global mobile messaging market in 2011 and remain "relatively insulated" as worldwide mobile messaging en route to decline, new report finds.
Written by Jamie Yap, Contributor

The number of mobile messages of text, images and video sent in Asia-Pacific is expected to hit 3.5 trillion this year, accounting for nearly half of the global volume of 7.5 trillion, according to Ovum. And while the worldwide market is seeing a decline, the Asia-Pacific region will be "relatively insulated" from this downward trend, the analyst firm notes.

The region's projected 3.5 trillion mobile messages will mark a 14 percent increase from last year's 3 trillion, Ovum said in a report Thursday. It added that about US$39 billion in revenue will be generated this year across the region, up 7 percent from 2010.

Furthermore, the compound annual growth rate (CAGR) for Asia-Pacific between 2011 and 2016 is projected to clock 4.76 percent, making it the second-highest growing region after South and Central America.

Asia-Pacific will remain "relatively insulated" from the impending global decline of mobile messaging, Ovum said. The analyst firm said the global mobile messaging market will eventually slow as message and revenue numbers start to decline due to the availability of alternative messaging options from Internet service providers (ISPs), handset vendors and social networks.

While growth rates of revenue and messaging traffic in the Asia-Pacific will slow down, it will not see a decline between 2011 and 2016. Ovum attributed the region's growth to China which it identified as a "star performer", registering a revenue increase of 11 percent this year over 2010.

Ovum analyst Neha Dharia said in the report that while mobile messaging market will continue to grow over the next four years, it is "fast approaching an inflection point".

Rather than turning to tradition text messaging, consumers increasingly are choosing to send messages via the growing list of Internet-based messaging services that have entered the market, Dharia said.

This trend is "intensifying" due to the growing presence of smartphones, low-cost data subscription plans, and the prevalence of third-party messaging service providers, she explained. In particular, handset makers' own messaging services are proving popular to rival the SMS (short messaging service), hence, stealing a share of mobile operators' SMS revenues. These include Research In Motion's BlackBerry Messenger, Apple's iMessage, and Nokia's Ovi Messaging.

With social networks, social messaging is also gaining importance, offering users new ways to communicate via their mobile phones and transforming the message content, Ovum pointed out. For instance, Facebook on a mobile phone has enabled messaging of shared photographs and other media, while Twitter has triggered discussions on current affairs and hot topics.

The microblogging company had revealed that 40 percent of tweets originated from mobile devices, Ovum noted. Twitter also recently announced it now has 100 million active users.

Mobile operators that want to "claw back lost market share" and continue to generate revenue from messaging will need to be innovative in their approach to both the services they offer and their business models, Dharia advised.

They should expand their messaging portfolio and add their own Internet-based messaging option, but not replicate those already found in the marketplace, the analyst said.

"Simply replicating a popular third-party service won't result in success for an operator-branded service. Operators must offer over and above a basic service by leveraging exclusive information they hold on consumers, such as frequently-called contacts," she added.

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