Portio mobile messaging user number is too big, can't be 4B today, more like 3.6B

A report came out yesterday by Portio on mobile messaging, that is summarized at Fierce Wireless. Regular readers know I am passionate about SMS messaging and MMS messaging on mobile. And it would greatly please me to find any analyst report new numbers, because inevitably the newer numbers for 2009 will be bigger than the numbers we had for 2008. So now Portio released their 4th edition of their study, the Mobile Messaging Futures 2010-2014 report. And it has good numbers that seem consistent with other sources reported in the past. Numbers like the total mobile messaging industry being worth 150 Billion dollars - consistent with growth from about 130 B last year - and total SMS traffic at 5 Trillion messages in 2009 and MMS revenues at 27 Billion dollars (yes, MMS alone is bigger than the total worldwide music industry - or the total box office revenues of Hollywood movies. And you thought its only person-to-person picture messages of poor quality at high prices. No, MMS is a very viable vibrant and growing media channel especially in Asia)

So far so good. But one number is totally out of whack. The SMS user number. Portio reported that total worldwide SMS text messaging user base has passed 4 Billion. Boy would I love that to be true and some day it certainly will be true. But it is far too much of a jump from last year. At the start of 2009 (end of 2008) the total SMS user base was passing 3 Billion. The total user base was 76% as a percentage of all subscribers of mobile phones worldwide. If Portio's number was true, SMS text messaging active user base would have suddenly jumped enormously to 87% of all mobile phone subscribers. That would be a huge jump in any circumstances.

But there are specific issues that hit SMS user levels at this enormous size. Note that SMS user base even at 3 Billion a year ago was by far the biggest data application on the planet, over twice as big as total user base of the internet. When we now bring mobile to ever more poor parts of the planet - Afirica, Latin America, poor parts of Asia like India, Bangladesh, Sri Lanka, Pakistan etc - and the Middle East - SMS text messaging collides with illiteracy. I heard that last year at several stops at events from Egypt to Indonesia to Brazil, Mexico and Pakistan. That their usage levels of SMS text messaging is well below the global average levels in great part because parts of the population who have phones, are not literate.

There are two other factors. The growth in phone subscriptions of first-time phone owners in Europe are in the under 10 year old segment and the very elderly, retired people. Obviously many of them have phones, but I mean the first-time buyers who never had a mobile phone before are almost all under age 10 or over age 70. With under 10 year olds - often 5 and 6 year olds yes, 5 and 6 year olds - do not write yet (often). And the very elderly - often have issues with arthritis and weak eyesight and thus greatly prefer to talk on a phone than attempt to write or read messages. There are 'biological' reasons why some parts of the society do not embrace SMS text messages.

And then there is the issue of multiple subscriptions. Often among the affluent, when having two or more phones, they perform similar uses and use similar services on both phones and on both networks. So if you are reading this blog you probably have two phones, and you probably put messaging traffic on both of your subscriptions. But for poor people who have two or more subscriptions, they often get separate subscriptions for their comparative benefits. Then they often have one accoun for voice calls, another for text messages etc. In these cases, of the multiple subscriptions one will be used for SMS, the other explicitly will not. That is a growing trend with multiple subscriptions now that relatiovely poor countries like the Ukraine have over 150% mobile phone subscriptions per capita.

So what should it be. I am certain that the user base has grown strongly in SMS, especially in touch economic times. If the percentage of SMS users out of the total subscriber base remained the same, at 76%, we would have 3.5 Billion active users of SMS. That is almost certainly the 'floor' level of the user base. Note that it is an enormous number by itself. If the percentage of users of SMS grew, to 78% of all mobile phone subscriptions, then we'd be at 3.6B users. This to me is still very reasonable. At the top end, if we actually accelerated SMS user base to 80%, we'd arrive at nearly 3.7B users. This number to me is the absolute maximum as of December 31, 2009. I would love to believe it was more, but it can't be. The numbers do not add up. So thank you Portio for nice data, but your SMS user base number is way off - has an error of roughly 10% overcount. It may be - and this often happens in this industry - that this is perhaps if Portio does not accurately measure multiple subscriptions and multiple phone ownership. That could explain the error. But nonetheless, please do not use the 4B number it cannot be. I am confident the 3.6B number is close to real, please use that and you can reference the TomiAhonen Almanac 2010 as your source if you need a source.

Finally - about that literacy. Please support the 1Goal initiative to put every kid into school during this decade. We are nearing that goal - it will eliminate illiteracy in our lifetime. They are not asking for money, just your support and publicity to promote the 1Goal and everyone from Ban Ki Moon at the UN are supporting it, as do dozens of athletes, movie stars, celebrities, national political leaders worldwide etc. (and we support the 1Goal here at Communities Dominate). Please read this short blog Support 1Goal to put every child into school.

Comments

[Paul Jardine]

The statistics on MMS really are amazing, and they point out something that media companies really should be aware of, but patently are not.
MMS is really just a packaged up version of email for a mobile phone, it delivers a multi-media message, in much the same way as an email has MIME components. It's only benefit is convenience, it reduces the friction for sending pictures and videos etc to your contacts.
What if sending a song was only marginally more cost than sending a standard MMS (or even the same!). People will clearly spend that amount to send something trivial, so it is not inconcievable that the usage would double if there was another content type to send.
If the music industry wised up and distributed their music for pennies as opposed to pounds, they would be generating similar or greater amounts of revenue. By making it expensive and difficult to obtain, they increase friction and reduce revenue

[Paul Jardine]

Incidentally, a number of fixed line operators that I have worked with have SMS for fixed phones as well. In fact, if I counted just the operators I know about, that would be an extra 50 million on the possible SMS user numbers.

[Tomi Ahonen]

Hi Paul

Good points. Yes, MMS is very under-appreciated, and in very many media executive's minds (in the West) it is easily confused with the person-to-person picture messaging, where an media/ad exec thinks 'thats the most daft idea ever' and dismisses MMS. Meanwhile it is a most powerful multimedia platform to deliver media and ads...

SMS on fixed line, good point. I had forgotten about it haha..

Tomi Ahonen :-)

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