Is WhatsApp Overtaking The SMS Soon?

by CXOtoday News Desk    Jan 24, 2014

instant messaging

WhatsApp has done it again with its smashing landmark figures! According to recent reports, WhatsApp’s active user base has more than doubled to 430 million from nearly 200 million users in August 2013 and now handles around 50 billion messages (sent and received) daily. Whatsapp’s CEO, Jan Kuom said at a recent global technology conference that in the last one month, the company has managed to add 30 million users, as by Christmas last year, it posted a 400 million user base. Some in the industry believe with such an accelerating growth volume, the cross-platform messaging platform may soon overtake the SMS!

A preferred choice

Since its launch in 2009 by the former Yahoo veterans Brian Acton and Jan Koum, the cross-platform application used for instant messaging across a wide range of smartphones, has taken the market by storm. On its growing popularity, users have cited different reasons such as its ease of use, great speed offered by the application and multiple device compatibility. Still others feel that the technology offers a cost effective way of sharing things with people in any part of the world.

What’s most interesting about WhatsApp’s steady rise is its subscription model. Unlike some of its other widely-used cross platform messengers, WhatsApp does not sell you stickers or shows you ads, according to a company statement. The company relies on users purchasing the application on a yearly subscription basis, but after a year’s worth of free usage. The app costs around Rs 50 a year after the first year lapses, a fee most users find worthwhile after using WhatsApp.

Winner in mobile social messaging

WhatsApp is clearly emerging as an alternate for SMS and MMS messaging. Seeing an increasing number of people getting hooked to WhatsApp, Benedict Evans, a mobile analyst has claimed that WhatsApp’s new daily message figures might have gone past the conventional messages being shared. Evans said on Twitter, “WhatsApp message volume growth is still accelerating. Has probably now overtaken SMS.”

A global survey conducted last year revealed that WhatsApp is a clear winner in the mobile social messaging space and has left behind giants like Apple’s iMessage, Google’s Hangouts, BBM Messenger, Snapchat, Skype and more. At present it is eyeing the conventional SMS market, which it considers a rival. 

Taking over conventional SMS

According to a Deloitte report earlier this month, the number of text messages sent in the UK fell for the first time in 2013, with smartphone users increasingly using instant messaging services like WhatsApp and Snapchat and this may soon become a global trend. However, Deloitte expects SMS will continue to generate significantly greater revenues than instant messaging services until 2018.

Meanwhile, most instant messaging services seem to be focused on capturing the largest possible user base. Ultimately these services may need to diversify their income streams by offering in-app purchases – such as emoticons, stickers and games – as well as advertising, in order to increase their revenues.

However Koum reiterated that WhatsApp will continue to remain ad-free as “monetizing the service was not an important thing, at the moment, and that the company wants to make sure ‘WhatsApp has a service that works.” WhatsApp also intends to focus on messaging alone. “If people want to play games there are plenty of other sites and also a lot of great companies building services around advertising. It’s a ‘free market’ with apps, so the beauty is that people can get those features elsewhere,” Koum said in a statement. Referring to picture messaging service such as Snapchat and WeChat, he added that the company would not focus on things like disappearing photos and games.

Industry watchers believe, with its growing popularity, the day may not be too far for WhatsApp to overtake SMS, Skype, Facebook and other messaging platforms, provided it has a sustainable model and keeps an eye on the future of mobile messaging.