Who (Dis)Continues to use SMS in the Age of Ubiquitous Mobile Internet Access?

Abstract

Using data of 11526 residential postpaid subscribers of the German subsidiary of a multinational mobile network operator (MNO) extracted from the firm's customer and billing records, this investigation empirically examines the association between monthly mobile Internet (MI) data traffic volume generated by consumers and their monthly number of SMS sent at the within- and between-subjects levels over 25 months from October 2011 to October 2013. Multilevel analysis of the time-varying and -constant study variables suggests that, in spite of a sharp decrease in the average/median number of outgoing SMS in the course of the investigation period, customer heterogeneity with regard to the relationship between MI and SMS use intensities is very large. The number of customers with a negative with-person regression slope for MI data volume is almost as high as the number of consumers, whose slope is positive. Subscribers, who are most likely to reduce their SMS volume in parallel to an increase of their MI data traffic, are persons, who (1) are heavy SMS users in the initial study period (October 2011), (2) are female, (3) have a longer MNO tenure, (4) are currently in an SMS flat price scheme, (5) are presently equipped with an Apple iPhone or a Samsung Galaxy smartphone and (6) put their current handset into operation more recently. Implications of these findings for service-marketing strategies of MNO and for future research on demand interdependencies between relatively newly introduced and well-established mobile communications services are discussed.