SMS is King, from the end-user’s perspective. SMS is heaven, from the operators’ perspective, as it is a cash cow. And SMS is hell for businesses offering messaging, but that don’t have a good plan for monetizing it…
SMS is way expensive to offer. For example, in the U.S.:
- A dedicated keyword will cost you around $12K a year,
- Connectivity to a message aggregator will cost you like $2K a month,
- Messages originated from your server will cost you about 2-5 cents, depending on volume.
- Time and development costs related to certifications across carriers (and differences between them), plus the ongoing support for audits.
Startups must do appropriate planning and have a business model that will cover SMS operational costs, or your SMS support will be short-lived. For better or worst, the above costs are barriers to entry for startups and anyone wanting to play the game. But SMS is King, a necessary “evil”, an important channel to support.
Twitter recently killed its support for SMS on the UK; for a long time many of us have been wondering how the hell Twitter has been able to support its offering without a business strategy that allows them to make money and cover operational costs.
So I’m not surprised to see Twitter cut costs, but what I’m surprised to see is that they decided to cut support for U.K. instead of introducing a revenue model and validate it; people will pay for useful services.
The question is not “Will someone kill SMS already?”. But the question is “Will SMS (costs) kill a Startup already?”.
“To SMS” or “Not To SMS”; that is the question…