Why decreasing SMS usage is good sign for Telecom Operators

According to TRAI, the average number of SMSes that mobile users sent has fallen by 7% for GSM and 6% for CDMA operators during the last quarter. An average GSM user sent about 26 SMSes a month in the quarter ended March 08, compared to 28 SMSes a month in the previous quarter (Oct-Dec 07) – ET

Infact, decreasing SMS usage is giving in to increasing data usage (493 minutes per month per month per customer in Jan- March 08 quarter, against a constant 463 minutes for about six months prior to that) – and that shows up in the increased ARPU for GSM players (not CDMA).

This is surely a good sign that Indian mobile users are consuming more voice (and less text) and data – and that will open up new opportunities for VAS content players.

Rural IVR is the next big opportunity and that’s where a lot of action will occur.

As far as VAS is concerned, operators will have to get easy on rev sharing with VAS content creators (currently, operators take 70% of the revenue, leaving no room for creators to experiment/innovate), if they want to increase the pie (or else somebody else will!)

What’s your opinion?

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