When we think of SMS (Short Message Service), we think of short text messages sent between friends, or to small groups via services like Twitter. This is how the Internet started too -- primarily as a communication medium. But soon the World-Wide Web made the internet a publishing medium as well.
The question is, can SMS messages to mobile phones become a free, ad-supported publishing medium? It seems unlikely, given the limitations: text messages must be no longer than 160 characters. In addition, they also cost both the sender and the receiver.
Necessity, however, is the mother of invention. By a coincidence of three factors, India seems to have the perfect conditions for the emergence of SMS publishing:
- Huge cell phone penetration -- 246 million and counting.
- Very low internet penetration -- about 20 million internet connections.
- A cost structure where senders pay for text messages but recipients don't.
I met today with Rajesh Jain, whose company Netcore offers a service called MyToday in India that is is effect the first SMS publisher. Rajesh Jain is an Internet pioneer, having started India's first internet portal, indiaworld.in, back in 1994 -- he sold it for over $115 million in 1999, in what was perhaps the first big Internet deal in India.
MyToday "publishes" a number of "MyToday Dailies", on topics such as News, Cricket, Health, Gossip, Local News, and so on. You subscribe to one one of these dailies by sending a text message to a published phone number from your cell phone. Subsequently, you will receive a daily (or sometimes, more frequent) text message "articles" on the topic you indicated interest in. The articles are editorially assembled, and also include an embedded ad. How, you might well ask, can you fit in a story and an ad within the 160-character limit? There are two parts to this answer:
- You can do a lot within 160 characters, if you try really hard and your expectations are not very high. I remember fitting very playable video games into 16K of RAM on my Sinclair Spectrum when 48K was way too expensive. I looked at some of the MyToday examples, and I'm impressed.
- It's possible to split stories across multiple text messages; more and more phones have the ability to handle messages larger than 160 characters; the SMS transport breaks them up into 160-character chunks and the phone re-assembles the message.
The real economic key to this whole enterprise, though, is the cost structure of SMS in India. There you don't pay to receive a message, only to send it. So for subscribers the service is entirely free, after the initial message to subscribe. And the numbers prove it. MyToday has over 3 million unique subscribers, each with 3 subscriptions on average. They send more than 10 million text messages a day, making them India's largest sender of text messages.
For MyToday, ad rates today are still below the cost of sending a text message, but text messaging rates -- especially for huge bulk purchases -- are falling dramatically, so it's not hard to see the crossover happening next year. And that could usher in the era of the SMS publishers.