Apps Redirect Text Messages, and Profits, From Cellular Providers

By BRIAN X. CHEN
December 4, 2012

For a long time, opening a cellphone bill was scary for the parents 
of teenagers. Charges for texting could reach hundreds of dollars a 
month, prompting many families to sign up for unlimited plans. But at 
perhaps $20 a month for each family member, that quickly added up, 
too.

Relief is on the way. Cellphone users are sending more text messages 
than ever, but increasingly they are free - thanks to the Internet. 
While that is good news for consumers, it could cost the world's 
wireless companies tens of billions of dollars in lost revenue.

Standard texting, the kind where you send abbreviation-filled 
messages over a cellphone network, has been in decline in many parts 
of the world, and now appears to be shrinking in the United States. 
That is because smartphones can use free Internet-powered services 
that send messages over data networks instead, and those services are 
attracting millions of users.

The shift is opening an opportunity for big companies like Facebook 
and Apple and smaller start-ups like WhatsApp and Kik, which are 
making aggressive grabs at this market, aiming to put themselves at 
the center of how people communicate in the smartphone era.

...

http://www.nytimes.com/2012/12/05/technology/free-messaging-apps-siphon-profits-from-cellular-providers.html

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