Short Message Service (SMS) is a text messaging service component of most telephone, World Wide Web, and mobile telephony systems. It uses standardized communication protocols to enable fixed line / landline or mobile phone devices to exchange short text messages. SMS was the most widely used data application, with an estimated 3.5 billion active users, or about 80% of all mobile phone subscribers, at the end of 2010.
The SMS concept was developed in the Franco-German GSM cooperation in 1984 by Friedhelm Hillebrand and Bernard Ghillebaert. The GSM is optimized for telephony, since this was identified as its main application. The key idea for SMS was to use this telephone-optimized system, and to transport messages on the signalling paths needed to control the telephone traffic during periods when no signalling traffic existed. In this way, unused resources in the system could be used to transport messages at minimal cost. However, it was necessary to limit the length of the messages to 128 bytes (later improved to 160 seven-bit characters) so that the messages could fit into the existing signalling formats. Based on his personal observations and on analysis of the typical lengths of postcard and Telex messages, Hillebrand argued that 160 characters was sufficient to express most messages succinctly.
The first proposal which initiated the development of SMS was made by a contribution of Germany and France into the GSM group meeting in February 1985 in Oslo. This proposal was further elaborated in GSM subgroup WP1 Services (Chairman Martine Alvernhe, France Telecom) based on a contribution from Germany. There were also initial discussions in the subgroup WP3 network aspects chaired by Jan Audestad (Telenor). The result was approved by the main GSM group in a June ’85 document which was distributed to industry. The input documents on SMS had been prepared by Friedhelm Hillebrand (Deutsche Telekom) with contributions from Bernard Ghillebaert (France Télécom). The definition that Friedhelm Hillebrand and Bernard Ghillebaert brought into GSM called for the provision of a message transmission service of alphanumeric messages to mobile users “with acknowledgement capabilities”. The last three words transformed SMS into something much more useful than the prevailing messaging paging that some in GSM might have had in mind.
The first SMS message was sent over the Vodafone GSM network in the United Kingdom on 3 December 1992, from Neil Papworth of Sema Group (now Mavenir Systems) using a personal computer to Richard Jarvis of Vodafone using an Orbitel 901 handset. The text of the message was “Merry Christmas.
The first commercial deployment of a short message service center (SMSC) was by Aldiscon part of Logica (now part of Acision) with Telia (now TeliaSonera) in Sweden in 1993, followed by Fleet Call (now Nextel) in the US, Telenor in Norway and BT Cellnet (now O2 UK) later in 1993. All first installations of SMS Gateways were for network notifications sent to mobile phones, usually to inform of voice mail messages.
The first commercially sold SMS service was offered to consumers, as a person-to-person text messaging service by Radiolinja (now part of Elisa) in Finland in 1993. Most early GSM mobile phone handsets did not support the ability to send SMS text messages, and Nokia was the only handset manufacturer whose total GSM phone line in 1993 supported user-sending of SMS text messages. According to Matti Makkonen, the inventor of SMS text messages, Nokia 2010, which was released in January 1994, was the first mobile phone to support composing SMSes easily.
In 2010, 6.1 trillion (6.1 × 1012) SMS text messages were sent. This translates into an average of 193,000 SMS per second. SMS has become a huge commercial industry, earning $114.6 billion globally in 2010. The global average price for an SMS message is US$0.11, while mobile networks charge each other interconnect fees of at least US$0.04 when connecting between different phone networks.
In 2015, the actual cost of sending an SMS in Australia was found to be $0.00016 per SMS.
In 2014, Caktus Group developed the world’s first SMS-based voter registration system in Libya. So far, more than 1.5 million people have registered using that system, providing Libyan voters with unprecedented access to the democratic process.
While SMS is still a growing market, traditional SMS is becoming increasingly challenged by alternative messaging services such as Facebook Messenger, WhatsApp and Viber available on smart phones with data connections, especially in Western countries where these services are growing in popularity. It has been reported that over 97% of smart phone owners use alternative messaging services at least once a day. Enterprise SMS-messaging also known as application-to-peer messaging (A2P Messaging) or 2-way SMS, continue to grow steadily at a rate of 4% annually. Enterprise SMS applications are primarily focused on CRM and delivering highly targeted service messages such as parcel-delivery alerts, real-time notification of credit/debit card purchase confirmations to protect against fraud, and appointment confirmations. Another primary source of growing A2P message volumes is two-step verification (alternatively referred to as 2-factor authentication) processes whereby users are delivered a one-time passcode over SMS and then are asked to enter that passcode online in order to verify their identity.