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Global A2P SMS market size will reach USD 70 billion by 2020

Global A2P SMS market size will reach USD 70 billion by 2020

Source: Zion Market Research

According to the report, global A2P SMS market was valued at around USD 55 billion in 2014 and is expected to reach USD 70 billion in 2020, growing at a CAGR of around 4% between 2015 and 2020.

A2P SMS stands for application to person SMS. These messages are sent from any web application or a browser to the subscribed end-user. This service can also be a two-way service i.e. from person to application. The A2P SMS service offers various alerts, notifications, promotional messages, news, polling contests, banking updates, flight alerts, etc. A2P SMS is one of the fastest growing service markets. A2P SMS service is widely used by a host of industries such as banking, financial services and insurance, retail and marketing, healthcare, media, entertainment and tourism.

A2P SMS market is primarily driven by strong growth in mobile subscribers across the world, especially in emerging economies such as India, China, etc. Many senders and receivers are depending upon A2P SMS for mobile payments, banking, and marketing activities. Additionally, rapidly advancing technology and innovations are also expected to fuel the growth of this industry. However, technological issues and illegal activities are expected to be major concerns for telecom operators during the forecast period.

The A2P SMS market is segmented based on various application segments that include pushed content services, customer relationship management services, promotional campaigns, interactive services and other applications. In 2014, the customer relationship management services dominated the application segment and accounted for around 30% share of the total revenue generated. Robust growth of e-commerce, as well as the growth of banking and financial industry, is mainly driving the growth of the customer relationship management service segment. The online retail trading application is also expected to exhibit rapid growth in the years to come. The online retail trading industry needs A2P SMS services for authentication purposes like OTPs (One Time Password) and confirmation messages for delivering the product. Furthermore, the increasing promotional campaigns by industries and enterprises are expected to propel demand for A2P SMS across the globe during the forecast period.

The A2P SMS market was dominated by Asia Pacific with over 40% share of the total revenue generated in 2014. Strong demand from emerging economies such as China and India is a major driving force for the growth of A2P SMS market in the region. North America and Europe are other important regional markets for A2P SMS market. Latin America and Middle East & Africa are also expected to witness significant growth in A2P SMS market in the years to come.

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