1.3 million businesses started using A2P SMS in 2020, taking the total number of business using the channel globally to just under 8 million. This represents an increase of 20% compared to the number of businesses using A2P SMS before the Pandemic.
To put this in perspective, even with strong growth in the number of businesses starting to use A2P SMS for the first time in 2020, there are still less than 3% of total registered businesses using it. Mobilesquared believes this highlights that businesses are only now starting to buy into the concept of using A2P SMS to communicate with customers and potential customers.
The Pandemic, lockdowns, and the new normal (if we know what that actually is yet), have forced businesses to expedite their digital transformation, and adapt their communications strategy, including the adoption of messaging as a core channel.
Year-on-year, A2P SMS traffic increased 14% between 2019 and 2020, compared to a 9% increase between 2018 to 2019, and 8.3% between 2017 and 2018. But if we just look at the growth of traffic in isolation, it shows that the actual growth increased by 18.2% between 2018 and 2019, but it grew 68.4% between 2019 and 2020. This was driven not only by new companies using the channel, but existing businesses increasing their usage.
In terms of spend, that increased to 18.2% in 2020 compared to the previous year. But again, if we just look at the increase in the growth of spend, it shows that the increase between 2018 and 2019 was 16.1%, but between 2019 and 2020, that jumped to 51.6%.
And we are seeing similar spend and usage levels in 2021. As an industry, A2P SMS has undergone a dramatic period of readjustment.
The consequence of the Pandemic and 2020 on the A2P SMS industry is positively catalytic. On the back of our research over the last 10 months, we have fundamentally revised our stance on the future of A2P SMS, and believe what we are experiencing now in terms of growth and usage is just the tip of the iceberg. Based on our new forecasts, we project the A2P SMS industry to grow by 87% between 2019 and 2025.
The new Global A2P SMS Forecasts 2017-2025 Databook is now available, published July 2021, and containing 2+ million data points and covering 200 markets. You can find full contents, overview and methodology and buy the data here