MMS a non-starter, for now

Multimedia messaging has landed, or so they would have you believe.
Read time 3min 00sec

Reading the headlines charting the progress of the mobile messaging industry, it`s easy to see why mobile phone operators have invested so much into multimedia messaging services (MMS).

No one expected SMS to do as well as it has, but in light of the unbridled success of this technology, it makes perfect sense for all stakeholders - mobile phone operators, content providers, third-party resellers - to press as much advantage from the situation as they can.

All this crystal ball gazing doesn`t change the fact that MMS is here, and mobile operators are punting it just as hard as they can.

Basheera Khan, Editor, ITWales

A number of mobile phone operators have begun the bid to familiarise consumers with MMS, though the TLA has been adapted to the more self-explanatory term `picture messaging`. Ad campaigns feature ordinary people in extraordinary situations, sharing the moment with friends and family.

And though Vodafone`s advertising budget extends far enough to feature David Beckham as a poster boy for picture messaging, I must admit, I am not convinced just yet that the MMS star is on the rise.

And I`m not alone. Strand Consult is an independent consultancy based in Copenhagen and with regional offices in Oslo, Stockholm and London. The company specialises in analysing and evaluating sales concepts and processes, and closely monitors sales and distribution channels in IT, telecoms, media and finance industries.

Its latest report, "How to make money on mobile services", provides a snapshot of the current and future market for mobile services in Europe, and concludes that mobile operators are setting their hopes too high, before all the prerequisites for a healthy and large mobile services market are actually in place.

The report is based on information and figures compiled from actual traffic statistics from a number of mobile operators and content and service providers across Europe, and shows that mobile services will only contribute 1% to 2% of the operators` ARPU (average revenue per user) in 2002, while P2P services (person-to-person SMSs etc) will account for 12%.

Based on Strand Consult`s actual data collected in 2002, the report predicts that mobile services will not overtake ARPU from P2P messages until 2005, when the ARPU from mobile services will be 17% - just beating the 16% to which P2P messages are expected to grow.

In other words, in 2005 non-voice ARPU will total 33% and half of that will still come from P2P messaging. It`s clear that either way, mobile operators have the opportunity to influence this figure tremendously.

There are many challenges and obstacles that must be overcome before operators can even hope of achieving the abovementioned 17% ARPU. On the other hand, as Strand Consult points out, that ARPU could be even bigger if the operators are prepared to move very fast in co-ordination with the rest of the mobile sector.

Of course, all this crystal ball gazing doesn`t change the fact that MMS is here, and mobile operators are punting it just as hard as they can. But with compatible handsets very thin on the ground, and pricing structures still uncertain, it`s going to be a while before consumers choose to send an image in lieu of a text. In the meantime, I`ll settle for a phone with the only sort of dual capability that really matters at the moment - and that is the ability to play my MP3s.

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