As we enter into new phase of wireless technology (i.e. 4G) it seems that telecommunication companies have already hinted the trends in mobile usage. People are using more voice and data now with 4G on the horizon. It is inevitable that demand for text messaging will decline.
If anyone hasn’t noticed yet, more and more people are using IM over SMS because it is more convenient. Not to mention there are lots of conversations happening on Facebook, too. With free Wi-Fi in campuses, coffee shops and even malls, it’s easier to get updates on people you care about simply by using popular social networking sites like Facebook straight from your mobile devices. As a result, less people are using text message to update friends and family. It seems that ‘chatting’ through text messages will be old fashioned before long. In addition, the market for tablets and smart phones is booming which is another nail in its coffin.
Text messaging had become cheaper lately due to maturing technology and increasing competition. As companies cut margins they get less profit. Some carriers had already increased their prices for text messages and stopped competing aggressively in this segment.
In the USA, AT&T planned to change their pricing for SMS plans. Before, SMS plans can be as low as $5 for 200 messages and $15 for 1,500 messages. With the new price rates the cheapest plan would be $10 for 1,000 messages with $0.10 charge per text if you exceed the limit. If you need more, you can get unlimited text message for $20. This is good news for heavy text message users. But how many people actually practice heavy texting these days? With the new price structure, they are effectively increasing the base price for light text message users, which is probably majority of their subscribers.
In the Philippines, the trend seems to be similar but less dramatic. Smart had recently announced that they would downplay unlimited promo. Instead of stepping up the base price for text messages promo, Smart is making unlimited text promos less accessible for typical Pinoy texters. To me, this is a sound business decision since Smart owns Red Mobile that already caters for unlimited call and text segment so there’s no point cannibalizing their own market.
I rarely use text message nowadays because it’s very easy to misread and miscommunicate. Maybe I would still use SMS heavily if Twitter via SMS is supported in the Philippine but that’s not the case. It’s good for occasional ‘poke’ but if I want to get the message across I make voice calls. On top of that, unlimited talk is more economical because it is cheaper these days and you get more value from it compared to unlimited text messages.
And that’s only the beginning. Telcos no longer compete among themselves because the competition had shifted to other means of communication. There are more promos for voice calls today than in previous years, whether for NDD or IDD, since more people are discovering VoIP to make free calls.
Don’t get me wrong. I am not against SMS or text messages. I am just telling the not so obvious. Expect to see less promo for text messages and more promos for voice because 4G is here already.
What I am anticipating is how soon will the prices of data plans catch up on innovations. More people will eventually adopt 4G even if they don’t know it. A new cycle will start and hopefully we’ll get bargain data plans before the advent of 5G.