Will the iPhone kill SMS?

OK, so we all know the world is divided into two camps: Those with iPhones, and those that wish they had iPhones. For the record, I’m in the latter camp because AT&T service is just horrible in my location. Those in the former camp are growing, and it’s a rabid group of individuals. You’ve surely seen all the numbers about online time, 3G data consumption, app consumption, etc. It’s a device that enables you to use the Internet for all it’s worth (again, unless you have AT&T which doesn’t allow tethering, MMS, etc., but I digress).

We’ve all also seen the growth in smart phone usage, and any sensible extrapolation of that trend would have most people having a smart phone of some sort within the next five years. Since all sorts of everyday activities, from soccer notifications to school closings to sports scores, are training Average Joes and Janes how to use messaging on their phone, the idea of an increasingly educated population using their smartphones to do all sorts of iPhone-like activities is only truly debatable in terms of timing. We all know it’s going to happen, we just would be arguing over the slope of the curves. Depending on what Verizon has up its sleeves with Apple (please please please: an iPhone with real keypad), this could accelerate tremendously in 2010.

The early success of the Palm Pre has set a new bar in the market regarding multitasking applications. So now I can have all sorts of apps from my mobile phone’s app store running simultaneously, talking with all sorts of devices, services, etc., in the background, while I’m playing, err… talking on the phone.

So where does this leave text messaging? Text messaging took off arguably because IM was not easily and inexpensively available on the phone. The plethora of apps for the iPhone has put to bed the idea that you might have a smart phone without a data plan. And the sheer bandwidth consumed by text messaging is almost invisible in this context. So will the text messaging masses move to real-time IP applications? I think so, and I think very quickly.

The rampant growth of Twitter has shown that a simple UI can dramatically meet communications needs, albeit using SMS as a transport mechanism. Facebook’s recent moves to add real-time communications to its system shows more. We’re starting to see GPS-based apps gain traction, and the concept of Presence—something not available in Twitter to any real degree—is gaining ground in many social networking applications. The idea of “Where I am/What’s My Status?” is the next real baseline for social networks, and SMS contributes nothing meaningful here.