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What will Apple's iMessage mean for carriers?

Posted by Chris Thierry | August 18, 2011 9:00 AM

iMessage for iPhone

Apple's next big move

With the recent unveiling of Apple's iOS5 came the announcement of many new features that promise to enhance the user experience and improve on iOS4. Among the new features came the (almost) surprising iMessage, which allows iPhone users to instantly message each other. iMessage is most definitely competing RIM's revolutionary BlackBerry Messenger (BBM) technology, which has allowed BlackBerry users to do the same thing for years. Many claim that iMessage means there is no longer a valid reason to buy a BlackBerry. While this claim is highly controversial (BlackBerry users have been singing the praises of third-party applications and multi-tasking since the beginning of time), the question everyone is asking is whether this means the end of carrier texting plans.

Carriers need SMS as much as we do

Texting plans are by far the most profitable for carriers. The plans are pricey but since texting has become such an essential tool in today’s world, people have had almost no choice but to pay the price. According to Portio Reasearch, SMS will be worth over $127 billion this year. Yet, BlackBerry users claim to have found a way to “cheat the system” by using RIM’s own BBM service. The service offers users the ability to send fast, encrypted and “free” messages to other BBM users. At first many overlooked the service, but as the number of BlackBerry owners grew so did the popularity of BBM. Many have observed it as RIM’s winning hand over Apple for years. The iOS5, however, will seek to change that, further decreasing the number of people using standard carrier SMS services.

Will iMessage really be free?

One can try and answer this question by looking at how carriers have adjusted to RIM's BBM system in the past. Many praise the fact that using BBM allows “free” text messaging. In truth, no one can use BBM without paying. Yes, BlackBerry Messenger sends messages through RIM servers and not through the carrier's- but the only way to enable BlackBerry Messaging is to have a BlackBerry data plan from a service provider, and that must be paid for, monthly. Even when using other ways to connect to the Internet, such as Wi-Fi, the service is inaccessible unless RIM has activated your service following your commitment to a BlackBerry data plan offered by your carrier. It is safe to assume that the same will be done when iOS5 is released. Otherwise, carriers can expect to lose an incredibly large amount of profit. Carriers can argue that the service must be charged for as it offers more than just instant messaging- as with BBM, iMessage will allow users to see if the person you sent a message to has read your message and if they are typing back.

Many apps offered in the Apple App Store allow iPhone, iPad and iPod touch users to message each other without charge already. Apps like Kik Messenger have been around for ages. Apps like these are even available to other smartphone users. They too allow users to see if recipients have read your message and if they are typing back. These apps are available without any charge whatsoever, so long as the device is connected to the Internet. Carriers have not reacted to apps like Kik Messenger, so there is still a possibility that iMessage will be closer to being “free” than BBM. With iOS5 being released in fall of this year, we will surely find out in the near future.  One thing is for sure though- as it stands, unless every mobile user owns an iPhone or a BlackBerry, SMS won't be rendered obsolete anytime soon.

( photo credit: Apple )

Contact us for information on integrating Personal-Liable Devices into Corporate Networks or for any inquiries about Telecom Expense Management.

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Written by Chris Thierry

Christopher is the president, founder, visionary, and driving force behind Cimpl, which first started in 2000 as Etelesolv: his goal is to bring holistic enterprise solutions to companies of all shapes and sizes. Moreover, Christopher’s devotion to the well-being of his employees has made Cimpl one of Canada’s Top 50 Employers. He’s also dedicated to giving back to his community, by serving in multiple industry associations. He’s a mentor for the Canadian Youth Business Foundation and a member of the Young Presidents' Organization, the Entrepreneurs’ Organization, the CIO Association of Canada, and the Telecom Expense Management Industry Association. Christopher holds a Bachelor’s degree in Management Information Systems and Marketing from the John Molson School of Business at Concordia University. He is also a graduate of the Massachusetts Institute of Technology's (MIT) Entrepreneur’s Master’s Program – a program specifically designed to optimize the skillsets of founders of high growth companies.

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