Text message spam could spell trouble for text-based ads

For Jeffrey Paul, his cell phone was the last bastion of communication solitude in a world overrun with telemarketing, junk mail and e-mail spam. But now, even his cell phone isn't safe from unwanted solicitations.

The 40-year-old sales executive from Los Angeles said he uses text messaging sporadically to contact friends, so he was extremely annoyed when he started getting text messages offering him a deal to buy or rent a time-share from Webuyresorts.com.

Even though the unwanted messages were costing Paul 10 cents a pop, he said he wasn't as annoyed about the cost, because he had received only a few of these messages. Instead, he was concerned that his cell phone would soon be hijacked by marketers, including his own cell phone provider, contacting him with unwanted advertisements.

"The real annoyance is that now I can't even be left alone on my cell phone," he said. "I actually cancelled my home phone because I was being bombarded with telemarketing. I guess I thought that my cell phone was a telemarket-free zone."

As more people subscribe to cell phone services—-nearly 220 million in the U.S as of June, according to the CTIA Wireless Association—-marketers see the mobile market as a ripe opportunity. According to research firm Informa, marketers will spend more than US$11 billion on mobile advertising by 2011.

Some of the marketing is being done through legitimate channels. Companies such as eBay and Orbitz allow customers to sign up for services that send text message alerts. Cell phone operators are also starting to experiment with sending text messages promoting new services.

But if mobile operators want to exploit this marketing opportunity, they must tread lightly so as not to annoy customers with messages they don't want, experts say. And a recent rise in text message spam could jeopardize these efforts.

Wave of spam coming
Between 2005 and 2006, the volume of text message spam that reaches subscribers is expected to grow by 60 percent, according to market research firm Ferris Research. Because cell phone operators understand the potential damage unwanted messages can have on their customers' willingness to accept any kind of text-based marketing, they've taken aggressive steps to nip it in the bud.

"We have everything to lose if text spam becomes as endemic as e-mail spam, and absolutely nothing to gain," said Jeffrey Nelson, a spokesman for Verizon Wirless.

Even though text-based spam is on the rise, the number of spam messages that actually get through to subscribers is relatively small, said Richi Jennings, an analyst at Ferris Research. In 2005, about 500 million unwanted text messages reached subscribers. In 2006, that figure is expected to be 800 million. And by the end of 2007, roughly 1 billion text-based spam messages will be received by subscribers, Jennings said. By comparison, U.S. cell phone users sent 12.5 billion text messages in the month of June alone, according to the CTIA Wireless Association.

And compared with the amount of e-mail spam, text message spam is a drop in the bucket. According to MessageLabs, which provides Web security services, roughly 73 percent of all e-mail sent worldwide in October was spam.

"The average cell phone user might get five of these text messages a year. Compared to e-mail spam, that's nothing," Jennings said.

But he said the difference is that unlike e-mail spam, text message spam can cost users money. In the U.S., most wireless subscribers pay about 10 cents for each message they send and receive.