Text Messaging Comes to the United States
By Joachim Bamrud, Thu Apr 26 00:00:00 GMT 2001

All the major US operators have recently started offering SMS-like text messaging. But one major challenge is the lack of inter-operability between carriers, although at least one company says it?s solved that problem.

In the course of the past six months, top US operators Verizon, AT&T, Sprint, Cingular, Nextel and VoiceStream have launched mobile text messaging services similar to SMS - the application that has taken Europe and certain parts of Asia by storm.

A key milestone in the United States took place in January when Verizon Wireless promoted its text messaging service through TV ads in connection with Super Bowl, the yearly US football finals and the single-most important marketing opportunity in the United States. Interestingly, none of the major carriers are even calling it SMS. AT&T calls it "2-way text messaging," VoiceStream calls it "e-notes," Cingular dubs it "Mobile to Mobile Messaging," while Verizon and Nextel calls it "Mobile Messaging" and Sprint refers to it as "Short Mail."

However, the US SMS market differs from the ones in Europe and Asia in several significant ways.

Whereas SMS in Europe uniformly allows 160 characters per message, each US operator sets its own maximum limits. Sprint PCS offers a limit of 100 characters, while Verizon has a 120-character limit. AT&T and Cingular offer up to 150 characters. Even VoiceStream, the only leading carrier that uses GSM today, offers an SMS service that can handle a maximum 140 characters per message. Nextel Communications offers an amazing 500-character limit. That's due to the fact that it uses a packet-based system over its proprietary network technology, iDEN.

Sprint PCS does not use an SMS platform to send text messages, but one based on the Wireless Application Protocol (WAP), that in turn uses a CDMA network.

No interoperability

However, all the text messaging services are restricted to each other’s networks. AT&T customers can only send to AT&T customers, Verizon to Verizon, and so forth.

Part of the reason is that many of the operators use different types of networks: CDMA, TDMA or GSM. But even two TDMA-operators, for example, still can’t exchange text messages.

And that may just be the biggest hurdle stopping the United States from emulating the SMS success in Europe and certain parts of Asia, analysts say.

“I don’t know if it will ever get to European standards. In order for that we need inter-operability between the carriers, ” says Elliott Hamilton, senior vice president for The Strategis Group, a US market researcher. “Carriers recognize that. They see the revenues Europe is making [and] they’re smart enough to know that if they don’t have inter-operability, the market will never take off like that.”

Officials at several top operators say they are looking into the issue of inter-operability.

“We’re working towards that,” says AT&T Wireless spokesman Ritch Blasi.

Jim Gerace, a spokesman for Verizon Wireless, says the operator is considering working towards inter-operability. One company, MobileSpring, says it’s found the solution. Its Metcalf Global Messaging enables SMS communication between CDMA, TDMA, GSM, iDEN and ReFLEX (a paging technology), connecting both wireless phones and two-way pagers.

The New York-based company has been in talks with all major US operators the past six months and is testing its technology with two, says Dan Oakley, senior director of product management.

He declined to identify the two. One smaller operator, Michigan-based NPI Wireless, has already implemented the technology.

Here’s how it works: A subscriber of a TDMA-operator sends a text message to the phone number of a GSM-operator. After he’s pressed send, it goes to Metcalf, which then re-routes it to the GSM-operator. The recipient of the message can then reply using the same system.

However, US operators emphasize that although inter-operability is lacking, many of the text messaging services are linked to other technologies such as e-mail, enabling broad communication between users from different operators.

Nextel, for example, offers the ability to send a text message as e-mail to a phone by using the phone number and adding an @page.nextel.com. That way non-Nextel customers can send a text message from a laptop or desktop PC, the company says.

"That opens up for a very broad way to get a message to and from everybody. If they want to send a text messages there are so many ways that can be done," says Audrey Shaper, a spokeswoman at Nextel. "People are very happy with that."

Sprint PCS also supplements its Short Mail, with an e-mail service that lets users send and receive e-mail on their phones by using the address user@sprintpcs.com.

Both Sprint and VoiceStream also offer phone access to AOL. Sprint offers the ability to access AOL, Yahoo and Juno from the wireless web, while VoiceStream provides access to AOL Instant Messenger on SMS (as well as WAP).

A major challenge is that many U.S. users have to type in a phone number followed by the @ symbol, then a long, specialized version of the carriers name. For example: 123456789@mobile.att.net.

"It's very unwieldy," says Oakley.

MobileSpring's Metcalf technology enables a user to just type in the phone number, just like the European SMS technology and the one provided by Sprint PCS for its Short Mail. Although the recipient will see the message coming from 1234567890@metcalf.com, he only has to make one click to reply, says Oakley.

Currently none of the major non-GSM operators offer the ability to send and receive SMS between the United States and Europe. GSM-carrier VoiceStream, which offers regular international roaming for its customers traveling to Europe or Europeans coming to the United States, did not return several phone calls and an e-mail asking for information and its Web site did not mention text messaging across the Atlantic.

However, MobileSpring is in talks with several European carriers to link them with US counterparts. The company’s strategy is to focus on ethnic communities, for example tying Eircell in Ireland with a carrier in Boston, where there is a large Irish-American community: Italy’s TIM with New York, where there is a large Italian-American community, etc.

Still, the potential for inter-continental text messaging is somewhat due to the time zone differences, says Oakley.

Recipient pays

Unlike Europe, American recipients have to pay for incoming text messages as well as outgoing ones (as they do with voice calls on mobile phones).

However, neither the operators nor independent analyst view this is as a hurdle for future growth. The carriers can simply adjust the prices downward if necessary, says Hamilton.

According to Oakley the US system may even be better than the European system.

“Given the popularity of bundled pricing in the US for both voice and messaging, the incremental cost of receiving any call or message is in effect zero,” he says. “Having a subscriber charging mechanism in place will provide a better platform in the US than in Europe for the deployment of value-added services”

More damaging, however, are recent news reports in US media about a Arizona mortgaging company that sent unsolicited advertisements through text messaging to more than 90,000 mobile phone users in the state. Even though they were unsolicited, the recipients had to pay, causing a wave of complaints from those affected and concern among potential users of text messaging.

“That’s definitely going to be a potential problem, whether it’s legal or technical,” says Hamilton. “Probably it will ultimately be a legal matter, otherwise [companies] could flood everyone’s phones with text messages.”

Because the market is barely starting, there are few figures on current SMS usage. AT&T reports that it has posted more than one million messages a day since it launched its service in November.

“We’ve seen a tremendous growth since we introduced [the service],” Blasi says.

Verizon, Sprint PCS and Nextel declined to give any figures. Nancy Sherrer, a spokeswoman for Sprint PCS, says that text messaging played a key part in the carrier’s first-quarter growth.

“Text messaging continues to grow. It’s the number one application on the wireless web,” she says.

MobileSpring, which has received internal projections from the operators, estimates there will be 2 billion text messages per month by the end of 2002 in the United States and Canada. That figure will grow nearly five-fold, to just under ten billion, by the end of the following year, it estimates.

The Yankee Group projects the number of SMS-capable phones will grow from 85 million this year to 110 million next year.

Shaper, of Nextel, says text messaging is taking off partly due to the fact that a lot of early users – like salespeople, electricians and Xerox repairmen – are using it and thus showcasing it for other potential customers.

“It’s definitely snowballing in popularity. The people using it in the field are in contact with others, they see how it could work for their business,” she says. “It’s kind of word-of-mouth, only text-in-hand."

Joachim Bamrud is an award-winning journalist with 17 years experience as a writer and editor in the United States, Europe and Latin America. Bamrud has worked for various print, broadcast and online media, including Latin Trade, Reuters and UPI. He can be reached at jbamrud@hotmail.com.