Teenagers like 16-year-old James McMinn from North Auckland are now turning to Apple's iMessage and chatting on Facebook despite being on a mobile phone plan which offers him "unlimited texts", reports Stuff.co.nz.
McMinn says he enjoys the extra space available for words on Facebook, unlike the limited 160 characters typically available in SMS messages. He also likes iMessage because it tells him when messages are being delivered and if they've been seen by the recipient and if they're replying.
Smartphone apps such as BlackBerry Messenger, iMessage, Microsoft Lync, Vyper, Skype and What's App are changing the way telcos make money, as well as the way people communicate.
Research company Informa Telecoms and Media found that last year an average of 19.1 billion messages were sent using chat apps each day, compared with an average 17.6 billion text messages.
Chat app use is expected to balloon to 41 billion messages a day, the global researcher predicts.
According to the Commerce Commission's Annual Telecommunications Monitoring Report, despite a rise in the number of mobile phones voice calls from mobiles declined for the second year, dropping from 4.4 billion minutes to 4.35 billion minutes after peaking at 4.44 billion minutes in 2010.
Fixed line calling is also on the decline, even when there's no charge. Chargeable fixed line calling minutes have fallen by 40 million minutes, and free fixed line calling has dropped by 16 million minutes. Both peaked in 2008.
Text messaging revenue bucked its five-year upward trend, dropping by 14 million from the previous year.