Premium SMS revenue equals 1/3 of mobile spend

Premium text messaging and purchasing content from premium off-portal storefronts are quickly becoming the biggest revenue streams for mobile marketers. According to a new report from Telephia, premium services account for more than 1/3 of the total mobile spend.

by Kristina Knight

Premium SMS revenues grew to $273 million in Q1, 2007.

"Premium SMS has grabbed a healthy slice of the mobile content market, accounting for an off-portal share of 32 percent," said Kanishka Agarwal, vice president of mobile media, Telephia. "Moreover, marketers are experimenting beyond the standard rate SMS voting pioneered by "American Idol" and tapping into premium SMS with voting/sweepstakes campaigns. NBC's "Deal or No Deal" has translated into a premium SMS hit, generating nearly half of the volume and revenue of voting/sweepstakes entries in the first quarter of 2007."

Premium SMS download purchases from off-portal storefronts were roughly $215 million (79% of the premium SMS revenue total). Ringtones and horoscope downloads are included in the number. Voting and sweepstakes messages, like those for American Idol voting, accounted for more than $35 million (13% of premium SMS revenue). However, mobile voting accounted for roughly 47% of the premium SMS volume, or about 34 million transactions.

Though mobile marketing is still a relatively new advertising medium, it is clear that mobile users are an active bunch. From television viewers voting for favorite reality show contestants or entering sweepstakes to users actually shopping and buying online, marketers would be smart to include mobile in their spending.