Teletext Chat Now the Most Popular SMS-TV Application in Europe

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European SMS Teletext Chat now so popular that it impacts on mobile operators Average Revenue Per User (ARPU)

Teletext Chat Now the Most Popular SMS-TV Application in Europe

Amsterdam, 5 September 2002 - From MTV Europe to reality TV shows such as Big Brother, an increasing number of television programmes are now enriched with overlays that display text messages sent in from viewers. Not surprisingly, channels which are dedicated to teenagers are pioneering these services and are generating some very healthy revenues. Some shows receive thousands of messages per hour, at premium rates ranging from €0.30 to €1.10 per message. However, while many SMS-TV ventures have proved remarkably popular, none have met with such pan-European success as Teletext Chat.

Teletext chat looks like an online chatroom, but it takes place on the television screen. In Europe, most television viewers are used to looking up text information via teletext. Teletext is widely used to look up anything from the weather forecast to the latest news from the stock exchange. With teletext chat, users can send in their own SMS messages which are then displayed by the broadcaster on certain teletext pages.

The popularity of teletext chat is becoming increasingly apparent throughout Europe. On one of the Dutch SBS teletext pages, users’ ‘SMS messages’ are constantly displayed and updated on the screen. The style and content bear a strong resemblance to online chatrooms. 'Who are you?', 'Why are you here?', 'Do you want to get in touch?', 'Are you a fan of Feyenoord?', 'Alright, I’m heading off now', 'Hello, here I am', 'Hey, are you there?' The service is so popular, generating millions of messages per year, that it can take hours before a message appears on screen. Other SBS pages develop the medium to allow more personal contact. At a rate of €0.25 per SMS it is possible to send messages directly to other users. This offers the possibility of SMS-TV dating, a concept that has already been developed in the United Kingdom, where SkyDigital has launched a dating channel where participants can chat via SMS. In Belgium, the Flemish VTM reports that it receives an average of 15,000 messages per day on teletext chat, while in Norway, TV2 has introduced the concept of 'Off Time' television whereby the television screen is used as an SMS message board during the off time hours of the station.

"Not only is teletext chat immensely popular with users, but it also solves one of the major problems for mobile operators working in the SMS-TV sector," said Matthijs Leendertse, Senior Research Analyst at Van Dusseldorp & Partners. "Until now the lack of capacity on the operator side has been a real problem for SMS-TV services. The SMS centres (SMSCs) that handle the SMS traffic are not equipped to deal with a large influx of messages in a short period of time, especially if an immediate message has to be sent in return. Furthermore, the billing systems of the mobile operators are also not designed to deal with peak traffic. This is especially evident for the pre-paid users where the billing system has to check in real time whether or not enough credit is left to support the message. Therefore, from the mobile operators’ point of view, a stable stream of messages is preferable." SMS teletext-chat encourages this usage pattern and is now generating the largest service-based revenues in Europe.

In Germany RTL-teletext, the largest teletext chat in Europe, is currently generating up to 180,000 SMS per day. Up to 16,000 messages per hour are being handled in parallel sessions by the service. The service generates daily revenues of up to €42,000 for the network operators. The service has proven so popular that the impact may even be seen in mobile operators’ average revenue per user (ARPU), which is used as a key benchmark by mobile operators. A large German operator like Vodafone can expect to increase their annual ARPU by €0,2 just through this single RTL-teletext service. "The fact that this impacts so visibly on the mobile operators’ ARPU is a key indicator of the potential for this sector moving forward," said Mr. Leendertse.

Research conducted for Van Dusseldorp & Partner’s upcoming ‘SMS-TV: Interactive Television Reinvented’ report reveals how and why SMS-TV chat is fast becoming by far the most popular SMS-TV application in Europe. This forthcoming report analyses the various business models spawned by the marriage of SMS and TV. ‘SMS-TV: Interactive TV Reinvented’ covers the sustainability and division of the substantial revenues generated, the complex value network and the changing roles therein. The report assesses and analyses the balance of power and the tensions between the SMS application developers and providers, the telecommunication networks, the TV concept developers, production companies, production distribution companies and broadcasters. With over 100 pages of detailed case-studies, and an extensive directory of the key players in the SMS-TV sector, this timely report is essential reading for anyone who needs to be up to speed on this burgeoning European industry.

This report was launched during the SMS Meets TV Seminar in Amsterdam on 16th September 2002. For more information about both the report and the seminar please visit http://www.smsmeetstv.com
or contact Ashley Smith, Senior Research Analyst on +31 20 330 2983 or at

ashley@vandusseldorp.com

The publication price for “SMS-TV: Interactive TV Reinvented” is EURO 450 for PDF and EURO 500 for print. To order please visit

http://www.vandusseldorp.com/publications/smspreorder.asp
To request a review copy of the report please contact Rob Allen on +31 20 535 6986 or at rob@vandusseldorp.com

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About Van Dusseldorp & Partners

Van Dusseldorp & Partners BV is an Amsterdam-based research and development company concentrating on European digital media strategies and policies. Van Dusseldorp & Partners provides commissionable research and analysis, pan-European data gathering, publishes independent reports, produces its own seminars and workshops as well as events for third parties, provides pan-European marketing and PR services, and operates several new media news websites and free newsletters.

Contact information:

Ashley Smith

Senior Research Analyst

Tel: +31 20 330 2983

ashley@vandusseldorp.com

Useful links:

SMS Meets TV

Vandusseldorp & Partners

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