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Germany

Video Killed the SMS Star?

SMS messaging has taken the world by storm. But it’s soon to be old hat. New MMS technology now taking hold in Europe allows people to send pictures, video and sound over their mobile phones. But it doesn’t come cheap.

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Say Cheese - mobile phones are getting into the photo and video business.

Some are calling it a revolution and comparing it to the switch from DOS to Windows, or black and white television to color. Others warn that behind the hype lie significantly higher costs that will drive up monthly phone bills. One thing is sure however, Multimedia Messaging Technology (MMS) technology will make the world of instant messaging between mobile phones users a brighter, more vibrant experience.

Soon, the days of SMS messaging and its monochrome text will be but a dim, grey memory, advocates say. MMS gives users the opportunity to deliver multimedia content, animated pictures complete with sound files, digital photographs, voice recordings on top of the usual text and eventually even offer 'live' traffic, sports and other entertainment reports.

MMS technology makes it possible to record images with an camera attachment that fits onto the mobile phone and send that content to others as you would a normal SMS message.

“With visual messaging, we’re writing the next chapter of the incredible success story of SMS text messaging,” said Dr. Michael Paetsch, marketing manager at Vodafone D2, one of Germany’s largest mobile phone providers and the first to offer MMS service to its prepaid customers.

SMS Success

He and other mobile phone executives would surely like nothing more than to see MMS emulate the SMS story, a phenomenon that went from a fad to a way of life for millions around the world, especially teenagers and young adults.

Worldwide, more than 62 billion SMS messages were sent per month this year, which translates into just over $5 billion (4.9 billion euro) in revenue. SMS fever has gripped Western Europe like nowhere else, and the region was responsible for 35% of the SMS messages sent in 2001. Japan followed close behind, with 31%. Interestingly enough, SMS in the United States is still a largely unknown phenomenon. Americans sent just 2% of the world’s short text messages last year.

In Western Europe, Germany leads the pack among individual countries. Last year it was responsible for more than a quarter of all SMS traffic.

Will Consumers Pay More?

Still, whether consumers will start sending MMS messages tomorrow just as they send SMS versions today is anything but certain. While MMS has it colourful promises, it also has a higher price tag. On average, an MMC is three to four times the price of its text-only cousin. Sending a MMS over the Vodafone D2 network with up to 30 KB of data will cost .59 euro. Messages up to 100 KB will run consumers 1.29 euro. SMS messages in comparison cost in the range of.09 euro to .39 euro, depending on the time of day sent.

Another new technology, one that also promised sound and fury, has not lived up to expectations. The much hyped UMTS technology, the third generation of mobile phones, was launched amid much fanfare in Japan. In Europe, telecom companies spent billions of euros on acquiring licenses. It’s providing to be money not well spent, yet. In Japan the market has been soft and people do not seem ready to pay for the services UMTS officers. Japanese mobile providers have not met their subscriber goals and as of the end of August, only 2.2 million consumers had signed up for the new service, just 3% of the nation’s mobile phone users.

Optimistic Outlook

Despite the higher costs for MMS, market researchers are confident that just as few would consider buying a black and white TV these days, in the future no one will want to return to the bad old days of the grey, silent, text-only SMS.

A survey conducted by Ovum, a telecommunications industry research group, showed that annual consumer revenues from MMS are set to reach about $70 billion (69 billion euro) worldwide in 2007. With such rosy predictions, small wonder that mobile operators are jumping onto this potential cash cow and putting their advertising departments into MMS overdrive.

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