The SMS: it’s got a great future behind it

Enrique Dans
Enrique Dans
3 min readSep 8, 2016

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SMS technology dates back to the 1985, when today’s smartphones would have been the stuff of science fiction if anybody had been capable of imagining them. This is very simple technology that sends alphanumerical chains of up to 140 characters, to which have been added the ability to add other types of content, formats, or bolting various messages together to create longer missives. It makes very good use of the radio network, and text messages can also be sent and received even when a call is being made. Their smallness means that users do not need to be given a radio channel as with a call, and can instead be inserted in the network’s own signaling information.

This simplicity, along with the fact that phones do not need special software, has led some optimistic souls, such as Telefonica, Spain’s leading telecoms operator, which published a report (in Spanish) last July foreseeing a future for this outmoded technology that has been overtaken by messaging systems that are much less limited and that have more advanced features such as end-to-end encryption.

In my opinion, this is an obsolete technology, one that survives largely due to corporate inertia. As far as the public is concerned, most of us now use instant messaging, which in many countries is now pretty much the monopoly of WhatsApp, now present in just about every smartphone in some countries, but is also used by Facebook Messenger in the United States, Canada, Australia and some 49 other countries, while Viber is used in 19 nations, WeChat in China, etc. But in the corporate environment, this transition has not taken place, due largely to the limited management ability of these types of platforms.

Facebook recently announced that the future of WhatsApp lay with business accounts, to be used for customer services or marketing. The mass roll out of these types of accounts is supposed to take place before the end of this year, and will give companies advanced contact center features such as multi-user management, direct connection to corporate databases and CRM, as well as user tracking, indicators, analytics, redirecting, automatic text generation, all of which will make SMS look like something out of the stone age. And while all this is going on, we will also see the rapid development of advanced bots and chatbots based on machine learning, all of which will extend into the corporate sphere.

Which explains my skepticism about the future of the SMS, despite the conclusions of Telefonica’s report. This is an obsolete technology following a pattern we have seen on many occasions and that tends to be characterized by abrupt transitions from the moment in which the advantages of replacement technology appear.

As a rule, businesses make pragmatic decisions based on rational variables. What for the moment is resistance based on the limitations of messaging apps and the lack of sophisticated management tools will soon give way to new, interesting opportunities that businesses will want to take advantage of, as well as the wish to secure greater privacy through the use of encryption.

The use of SMS will soon be limited to special types of communications, machine-to-machine (M2M), Internet of Things (IoT), etc. where its many limitations can be turned into real advantages, but if you were planning on using SMS for commercial or customer service purposes, be aware that there are better solutions now, and the market will shift gears soon. Companies that hang on to obsolete technology will end up looking equally outdated.

(En español, aquí)

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Enrique Dans
Enrique Dans

Professor of Innovation at IE Business School and blogger (in English here and in Spanish at enriquedans.com)