Telecom operators face OTT-driven SMS revenue losses

India’s telecom operators are expected to face a loss of $29.2 million (approx Rs 250 crore) in business messaging (SMS) revenue to over-the-top (OTT) messaging platforms over the next five years.

This decline in revenue is anticipated alongside a substantial sixfold increase in OTT business messaging traffic between 2023 and 2028. The OTT business messaging traffic in India is predicted to reach 24.2 billion messages in 2028, rising from 4 billion messages in 2023.

Juniper Research also notes that retail firms are among the primary users of enterprise messaging and spend the most on OTT business messaging. This is expected to surge to $5 million by 2028, compared to a projected $0.8 million in 2023.

Analysts and industry executives suggest that the shift to OTT communication platforms will be gradual. As some enterprises may opt for both SMS and OTT platforms, the estimated revenue loss over the next five years is around Rs 250 crore.

According to ET, in a recent communication to the government, Indian mobile operators expressed concerns about the migration of enterprise messaging to OTT platforms, estimating an annual revenue loss of Rs 3,000 crore for both the government and service providers.

Telecom operators have raised concerns about enterprises increasingly using OTT platforms like WhatsApp and Telegram for business messages. In response, tech firms have argued that consumers prefer OTT messaging due to superior technology. Business Standard