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Mobile industry accused of hyping 'texting on steroids'

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The mobile industry is in danger of swallowing its own hype about the growth potential of Multimedia Messaging Services (MMS), leaving it in danger of repeating the mistakes made with the introduction of WAP.

That's the view of market researchers Wireless World Forum (W2F) which reckons estimates that users will be sending 10 billion messages a month within the next two years are way too high. It reckons that 200 million MMS messages a month in 2004 is closer to the mark.

W2F predicts MMS will be worth $5.8 billion by 2006 across 16 key global markets - or 80 per cent less than the current crop of analyst predictions.

So, if W2F is right, why is the rest of industry getting it so wrong?

SMS was phenomenon that no-one predicted - in some developed markets it contributes as much as 12 per cent of mobile operator revenues. The W2F refers to industry view of MMS as "texting on steroids" so the perception is that rich media content will drive the consumers to migrate from SMS to MMS.

But that rationale is flaky, W2F reckons, because it fails to differentiate from what people might like to do and what they are prepared to pay for.

Previous industry research shows that the consumer, when presented with a choice between rich graphics and plain lettering, will select the former. W2F's research shows that following this line of research will create an unrealistic picture, as consumer's desired behaviour is very different from their actual consumption patterns.

The roll out of MMS will be further hampered by its initial unavailability on the pre-pay market. The youth market (under 22 year olds), send 88 per cent of all text messages, yet initial MMS-enabled handsets and services will be priced outside of their reach.

Developing attractive pricing models for MMS (do you charge the same for a 30KB message as a 50KB message) and credible MMS business models are further issues operators have yet to overcome, according to the market researchers.

W2F believes that MMS will fail to substitute SMS, as the consumer will use the two platforms for very different purposes. The success of SMS has been driven by users perceiving it as a cheaper and easier form of communication to voice. The driver for MMS will be entertainment.

MMS will find success in certain application areas - such as picture messaging, but overall W2F believes that MMS will only substitute "a maximum of 10 per cent of the SMS market".

W2F advises that mobile companies need to gain a better understanding of their customer's needs and lifestyles. Otherwise they will be seduced by the technology, sell only to the early adopters and fail to understand why their revenue and usage projections are not being met, it warns. ®

External Links

MMS 'The big picture by Wireless World Forum - links to executive summary

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