June 3 2003

LONDON – Over 20% of mobile data users worldwide will use MMS in 2007, according to a new report from ARC Group, which equates to around 25 billion messages a year, or just over 2 billion messages per month. However, the report predicts that MMS traffic will start to grow exponentially after 2007, once the viral effect of MMS begins to take hold.

However, the report predicts that MMS traffic will start to grow exponentially after 2007, once the viral effect of MMS begins to take hold.

Karen Walsh, part of the ARC Group team that produced the report says that factors such as lack of interoperability and roaming agreements between mobile operators, low numbers of mass-market handsets, and limited third-party business models contribute to this conservative take-up of MMS to 2007.

The main function of MMS will be as a content delivery mechanism, according to the new report, which forecasts that nearly 50% of the 25 billion messages in 2007 will utilise MMS for content-to-person (C2P) transactions. And that importantly, this C2P use will generate 71% of the operators overall MMS revenue by 2007. The premium nature of the content, according to Walsh, will allow service providers to offset the low overall level of usage against the value of the 20% who do use MMS.
 

The leading application type and associated services most likely to drive MMS uptake at the outset are based on P2P relationships, e.g. picture messaging and video messaging. Future drivers will include services linked to messaging, such as in-game dialogue or applications sent as messages.
 

The report affirms that the interactive capabilities allied to the enhanced graphical capabilities of MMS will see applications based on adult content proliferating. It goes on to conclude that MMS brings enhanced capabilities to various application categories including entertainment, LBS, infotainment and mobile advertising.
 

Key concerns identified by the report’s authors include the issues of pricing, billing technological challenges and issues relating to revenue share between network owners and providers of content within the network.
 

The report concludes that although the industry is facing numerous problems from the economic to technological, MMS has immense support from operators, and other parties, and will play a pivotal role as a medium for demonstrating the potential of new mobile services.
Notes to editors:

ARC Group (www.arcgroup.com) publishes in-depth strategic reports and provides consultancy on wireless internet, wireless technologies and infrastructure, digital broadcasting, broadband access, telematics and optical communications.

 

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