Rapid rise of chat apps slims texting cash cow for mobile operators Chat apps such as WhatsApp and Apple's iMessage have overtaken the text message as the favourite way to tap out a note to friends, undermining the traditional SMS cash cow for mobile operators. The data, collected for the Financial Times by telecoms and media consultancy Informa, highlights the rapid rise of a technology that did not exist five years ago but is seen by some as a potential challenger to Facebook's dominance in social networking. There were more instant messages being sent daily by the end of last year than there were text messages, according to Informa. The consultancy expects "over the top" messaging to more than double to 41bn per day this year - more than twice the number of text messages expected to be sent. The transfer in technology has big implications for the telecoms industry, which will generate more than $120bn from text messages this year, according to Informa. Many internet-based applications offer voice chat as well as text-based messaging services, including video links, which is striking at the core of the telecoms industry. Pamela Clark-Dickson, senior analyst at Informa said internet messaging was increasingly used as a substitute for SMS in a number of markets. This had "a significant impact on mobile operators" traffic and revenues in some countries, including Spain, the Netherlands and South Korea." For example, text revenues in Spain have fallen from €1.1bn in 2007 to €758.5m in 2011 as traffic declined from 9.5bn messages in 2007 to 7.4bn in 2011. In the chat app market, start-ups such as WhatsApp, Viber and Kik are competing with services such as Apple's iMessage, BlackBerry Messenger and Facebook's Chat Heads. "I think killing text messaging is going to be inevitable as people switch to [mobile] data plans," said Ted Livingston, chief executive of Kik, which claims 50m registered users and raised $19.5m in venture capital funding last week. If I can get something that is just as good for free, rather than paying for it, I'll probably take it for free. Mobile operators are beginning to fight back with services of their own, bundled in voice, text and data packages, and with hopes that the arrival of superfast 4G networks could allow premium prices to be restored to an industry accustomed to long-term revenue decline for traditional business.