In Three Years, 25% Of SMS Contact Will Be With Apps

By 2018, a quarter of all text messages sent worldwide are expected to be between applications and consumers, a new report has revealed.

The fast-growing application-to-person (A2P) SMS market is set to keep increasing, with global traffic hitting 1,625bn this year.

This is according to a new special report on the German messaging market from payment and messaging service provider DIMOCO.

Produced alongside partner Portio Research, the report finds that 11.4bn A2P (application-to-person) and P2A (person-to-application) text messages were sent in Germany in 2013.

And the worldwide A2P & P2A traffic is set to keep increasing, hitting 1,762bn messages by 2018.

DIMOCO said: “With the increasing focus on mobile banking, mobile payments and mobile health etc., we believe that the contribution of the A2P category will increase over the next five years.”

The study says that by 2018, a quarter of all SMS messages will either originate from, or terminate at, an application server.

Speaking about the German market, Karl Whitfield, Research Director at Portio Research said: “The German 1 and 2-way messaging market can be classified as a mature market. The contribution of A2P traffic is above worldwide average.”

DIMOCO President & CEO Gerald Tauchner said the company’s “internal analyses confirms this as well. Aggregators as well as corporate customers use our 0-hop connection to the German mobile network operators.”

The special report also gives other insights into the German mobile market.

In April 2015, there were 112.6m mobile subscribers in the country.

The network provider with the biggest share of subscribers was Telefonica Germany brands O2 and E-Plus, which had 37% of the total market.

Following closely behind was Telekom Germany’s brand T-Mobile with 35%, then Vodafone with 28%.

This increase in the A2P & P2A market comes as apps like WhatsApp have made a huge dent in carriers’ hold over the messaging market.

Research from Ovum estimates that WhatsApp has cost phone providers like Verizon, Vodafone and O2 over $32.5bn in 2013, with this loss expected to reach $54bn by 2016.

Earlier this year, payment company DIMOCO announced its expansion into the French market with the acquisition of Mpulse.

Find out more about its carrier billing and mobile messaging services here, and read the full German market report here.