The increasing popularity of sending messages on social networking sites via smartphone cost telecom companies €10.4 billion in lost revenues from text messages last year, research has indicated.

Industry analyst Ovum also revealed that these companies lost out on €6.5 billion due to the trend in 2010, which equated to six percent of total messaging revenue during the year. Last year, it accounted for nine percent of total messaging revenue.

Companies will need to rework their legacy services if they want to cash in on messaging services in the future, Ovum's report said.

Report author, Neha Dharia, consumer analyst at Ovum, said: "Social messaging has disrupted traditional services, and operators' revenues in this area will come under increasing pressure. Tapping into the creativity of app developers, forming industry-wide collaborations, and leveraging their usage data and strong relationships with subscribers are the key ways for operators to ensure that they hold their ground in the messaging market."

The report went on to add that telecommunications companies should embrace social messaging and view it as an opportunity to boost their earnings.

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