Cell Networks Lost $13.9 Billion to Social Media Apps in 2011

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Proving yet again that the Internet offers free alternatives for things one used to have to pay for (see: the newspaper), a new report today says that cell phone networks lost $13.9 billion worth of revenue to free social media apps in 2011. These include services like Facebook Chat, BlackBerry's ever-popular internal messaging system, and independent services like WhatsApp. (Apple's newish iMessage system -- part of iOS 5, released last year -- wasn't mentioned.) These services are "alternative" to SMS, short for "short messaging system," the standard texting system that folks have <3-ed for years (as have the networks selling texting plans).

But analysts at the firm Ovum say that networks have taken that 10-figure hit as people switch to these newer, fee-free messaging systems. There are a few caveats, of course. As BBC News reports, "the study did not factor in the extra income networks received from mobile data costs because of increased Internet usage resulting from social messaging." And we can't help but note that plenty of texters would still avoid paying for SMS without the WhatsApps of the world by using an even older form of communication: email.

This article is from the archive of our partner The Wire.