HAMPSHIRE, ENGLAND—New data from Juniper Research has shown that the messaging market will decline from $113.5 billion in 2014 to $112.9 billionn in 2019—a reduction of $600 million.
Overall, messaging traffic is forecast to double by 2019. This is driven by over-the-top messaging applications such as WhatsApp and Line, seeing a threefold increase in message traffic—from almost 31 trillion in 2014, to 100 trillion by 2019 globally.
However, revenue generated from each OTT message is forecast be less than 1 percent of that from SMS and MMS in 2019. Juniper found that OTT messaging services are struggle to raise revenues. Combined with users switching from SMS and MMS services, this will contribute to a contraction in the overall revenue pot.
OTTs have not yet succeeded in using advertising at scale to monetise their services, due to a limited acceptance by consumers, particularly in Asian markets. In these markets, messaging services have relied upon in-app purchases such as sticker sets to generate income, Juniper said.
OTT players are now seeing further diversification with a foray by several big players into the payments market for example, Line Pay, Facebook’s use of Messenger to send payments, and Snapchat’s Snapcash.
Traditional messaging services from mobile network operators have long since been viewed as under threat from OTT offerings. However, in terms of revenues, SMS still continues to dominate the market, with mobile network operators benefiting from growth in the application-to-person sector.
