We’ve known for some time it’s popular, but now we know for sure it’s just not that profitable.
A new report from Juniper Research highlights the growing disparity between traffic volumes and revenues in the mobile messaging market.
According to a report summary shared with MMW, despite accounting for 75% of the traffic (or 63 trillion messages), by 2018, Instant Messaging apps will only generate 2% of the mobile messaging market’s revenue, at just over $3 billion.
The report – Mobile Messaging Markets: IM, Social, SMS, MMS, Email, RCS/RCS-e 2014-2018 – stated that the increasingly high IM traffic volumes are the result of a number of factors, but chief among them is the fact that usage of IM apps is inherently different to usage of SMS; users typically send up to 10 ‘chats’ to convey a message which could be contained in 1 SMS.
“Nevertheless IM apps are continuing to encounter difficulties in generating revenues, given the infancy of the market,” Juniper reports. “The hundreds of IM apps available are taking different approaches, some utilising in-app purchases and games, others with advertising or subscriptions. Indeed, some apps, such as Facebook Messenger, are loss leaders, and only serve to increase engagement with a companies’ separate revenue generating app.:
Curiously, the Far East & China will generate the most traffic across all mobile messaging formats, throughout the forecast period.