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The Global Killer App: Why we need to stop ignoring SMS

By: Alicia Levine

Messaging has been a hot topic lately in Bay Area tech news, coffee shops, and SoMa bars.

          “What’s Facebook up to now that they’ve bought WhatsApp and poached the head of PayPal?”

          “How does this messaging app ‘Yo’ work, and why the heck does it deserve so much press?”

          “What’s up with this mesh messaging thing? Messaging without internet sounds weird…”

These days, most of the tech community is enamored by snazzy new Internet-based, over-the-top (OTT) messaging applications, seeking the next “killer app” of messaging. But many of these apps focus on messaging as a form of entertainment or play. Like Snapchat, which was launched to make messaging ephemeral and fun, most of these apps require users to have smartphones and high-speed connections to download and use the apps. While these newfangled messaging applications appeal to markets in the US and developed nations, there are a smaller number of application developers thinking more globally – particularly those who are looking at innovative ways to use messaging to positively impact society. Instead of developing new messaging applications, they’re pushing the limits on an existing messaging technology. Many of those more globally-oriented organizations see the killer global messaging app as one that’s been staring at us all for years: SMS (Simple Messaging Service).

Why is SMS the global killer app? SMS maintains one gigantic advantage over OTT messaging:
global ubiquity.

Image: 5 billion mobile users by 2017

There are nearly 7 billion mobile devices in the world and SMS is on virtually all of them. That’s why even Uber, the super sleek smartphone app that delivers a personal driver to your doorstep in minutes and just received a $17B valuation, relies on SMS.

It’s undeniable that we’re seeing a pivot away from SMS as the primary peer-to-peer messaging platform in markets where most have access to smartphones or browser-enabled feature phones. But in developing markets, home to billions of emerging consumers, smartphone penetration has yet to reach high levels. For billions, SMS dominates in both peer-to-peer communication and business communication.

Numerous Bay Area organizations and companies are building novel ways of using SMS, particularly for consumers in developing markets. SMS can accomplish tasks we never before challenged it to do – like verify the authenticity of medicines in rural Kenya, send money securely over long distances to family members without bank accounts in Paraguay, and connect job seekers to employment opportunities in Bangladesh.

Here are just a few examples of Bay Area organizations utilizing SMS in ways that improve livelihoods and have a real impact on society.

Image: Factory Worker Using SMS
        A factory worker using SMS (Source)

Labor Link: Last year’s horrific Rana Plaza building collapse in Bangladesh killed more than 1,100 workers and provided the world with a stark reminder of what that “Made on Bangladesh” tag on our jeans really means. Labor Link, a product of Good World Solutions, utilizes mobile phone surveys via both SMS and Interactive Voice Response to collect information from workers on working conditions in an anonymous format. That means a worker sewing buttons on a dress in Mexico or assembling iPhones on a factory floor in China can safely and anonymously report unsavory conditions on their own or a friend’s mobile phone. Companies like Cisco and Adidas use Labor Link to detect concerning issues for workers. In some cases, workers are compensated with a bit of mobile credit to make up for any credit used to complete the survey.

Telerivet and Kiva.org: A partnership between two Bay Area companies – Telerivet and Kiva.org – enables microfinance borrowers to communicate directly and in real-time with their local lenders through a new Kiva product called Kiva Zip. Telerivet’s platform also allows Kiva to collect application materials from borrowers, send payment reminders, and facilitate other communication via SMS to local numbers. Ongoing and local communication is a key factor in getting borrowers to make payments on time, a positive for both borrowers and lenders.

Juntos Finanzas

                 (Source)

Juntos Finanzas: Less than half of adults in developing countries have bank accounts, making it difficult for them to save money. Juntos creates personal finance tools for cash-based households to help them work towards personal goals of savings. Started as a project at Stanford’s design school and guided by behavioral research, the founding team built an SMS-based program that acts as a personal finance coach that motivates users to form new habits and increase a sense of financial confidence and control. Juntos now works with financial institutions and banks primarily in Latin America to deploy the SMS-based financial coach. They’re eyeing East Africa next, where 44% of adults in Tanzania used some form of mobile money in 2013, meaning consumers already have strong financial habits interacting with money via text.

While SMS functionality continues to grow beyond its traditional peer-to-peer conversations, with many Bay Area organizations leading that charge, limitations remain for what SMS alone can accomplish. The potential for SMS relies on a number of factors that influence its ability to deliver positive social change and the speed at which that change may happen:

Mobile penetration: Access to SMS is inherently tied to mobile phone access itself and, as outlined above, enables an endless number of valuable two-way connections, products, and services. There has been a precipitous rise in global mobile market penetration (the vast majority of countries had over 60% penetration in 2012 according to GSMA Mobile for Development), yet penetration rates are still low in places like Myanmar (10% in 2012) and Ethiopia (20% in 2012). Furthermore, women are 21% less likely to own a mobile phone than their male counterparts. While fewer women currently have phones, mobile ownership delivers unique benefits to women including improved access to information about health, educational content, and employment opportunities. This makes women a key target for increased mobile phone access and SMS engagement, yet that great potential will only be realized if the challenges of reaching and putting phones in the hands of those women are overcome.

Literacy rates: Lack of basic literacy can completely undermine the value of a text. If a person can’t read or write, texting will not be a viable means of communication. Organizations like VOTO Mobile, who conducts two-way surveys primarily in Africa, complements its SMS offering with the option to disseminate surveys through an Interactive Voice Response (IVR) system that requires little or no reading to complete. With 1 in 3 adults in Sub-Saharan Africa unable to read, IVR products are often needed to achieve real reach across communities with varying educational levels. Alternatives like IVR, along with literacy education and the evolution of phones able to SMS in local languages, will have a profound impact on SMS use.

A text is…just a text: This limitation is universal, a constraint we’ve all probably experienced one too many times in our communication via text with friends, family, or would-be love interests. There are inherent limitations to communicating solely via text. There’s no substitute for face-to-face human interaction. However, SMS group chats do give people without Internet connectivity the opportunity to chat with friends, relatives, and peers. SMS is also often used as the preferred communications means to organize 1-on-1 meetings, group gatherings, or even democratic revolutions because of its universal reach.

While much of the media talks about the latest and greatest OTT messaging apps hitting the app store, SMS continues to forge ahead forward as an invaluable communications tool that’s both powerful and ubiquitous. Many like to speculate on the next killer app, but let’s innovate with what we know already has the greatest reach and potential. SMS has been the global killer app for years and will stay that way for years to come.

Start spreading that as the new “overheard in SF” one-liner, sent by SMS.

—            —            —

Alicia Levine believes that we’ve only just scratched the surface of using information and communications technology to drive positive social change. She calls San Francisco home but is always seeking her next, preferably off the beaten path, adventure. Alicia is currently a Mobile for Development Project Lead at Vital Wave Consulting. To connect visit www.alicialev.com or follow @alicialev.

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