Despite the surging popularity of over-the-top messaging applications, traditional SMS will increase at a compound annual growth rate of 3 percent over the next five years and yield $722.7 billion in worldwide operator revenues between 2011 and 2016, according to a new Informa Telecoms & Media forecast.

Informa projects that SMS traffic will reach 9.4 trillion messages by 2016, up from 5.9 trillion messages in 2011. However, its share of global mobile messaging traffic will plummet from 64.1 percent in 2011 to 42.1 percent in 2016. Worldwide mobile instant messaging traffic will concurrently increase from 1.6 trillion messages in 2011 to 7.7 trillion messages in 2016, doubling its traffic share from 17.1 percent in 2011 to 34.6 percent in 2016.

"There will not be a uniform decline in mobile operators' SMS traffic and revenues as a result of the adoption and use of over-the-top messaging services," said Pamela Clark-Dickson, Informa Telecoms & Media senior analyst for mobile content and applications. "Factors such as the operators' pricing strategies, and the penetration of smartphones and mobile broadband in a market will determine how quickly and to what extent substitution occurs. For example, operators offering integrated tariffs that include a balanced proportion of voice, SMS and mobile data are continuing to see growth in their SMS traffic and less impact on their SMS revenues."

Informa adds that mobile IM will generate greater revenues than third-party OTT messaging services through 2016, generating $8.7 billion globally. However, OTT service revenues will climb to $7.4 billion by the end of the forecast period.

Both mobile IM and OTT services will continue to lag behind mobile email, which will drive operator revenues of $32 billion by 2016. "Mobile email is an important revenue-generating service for mobile operators, largely because they offer it as a service bundled with a mobile data plan," said Clark-Dickson.