March 14th, 2011

Group texting may be next big thing at SXSW

San Francisco Chronicle

Cineastes have Sundance; startups have South by Southwest.

The annual technology and arts conference in Austin, Texas, began as a music festival in 1987 but added an “interactive” component in 1994. It’s where tech’s early adopters get to act like Hollywood studio heads, passing judgment on new ideas and propelling some into the national consciousness. South by Southwest, commonly known as SXSW, was the scene of Twitter’s big break in 2007, and location check-in service Foursquare premiered there two years later.

This year’s hit, if there is one, is likely to be one of the buzzed-about “group messaging” startups - GroupMe, Beluga, or textPlus, among others.

Group chats are easy to arrange online through instant messaging services or social-networking features such as Facebook Groups. But they don’t work well on mobile devices, or if they do, they require a smart-phone app and a decent cellular signal, which excludes lots of potential users.

Steve Martocci and Jared Hecht, co-founders of New York’s GroupMe, frequently encountered communications problems while at concerts for their favorite act, the jam band Disco Biscuits.

“No one’s checking e-mail on their phone, the Internet connection doesn’t work at the venue,” said Martocci. “There’s no good way to stay in touch in real time with a group.”

GroupMe and its ilk are designed to work for anyone, on any phone. In general, users set up groups either online or through a smart-phone app and then invite members - family, colleagues, jam-band fans - to join. The service assigns each group a unique phone number; when a member sends a text to that number, everyone receives the message.

There are extra features for those with smart phones (such as the ability to send photos or start new groups), but anyone with enough thumb dexterity to send a text can join in conversations. And because texting works just fine even when cell reception is faint, it’s often usable when the Internet and voice calls aren’t.

There are nearly a dozen startups, most less than a year old, that hew to this basic framework, then add their own twist. GroupMe, which started in August and says its users are now sending over a million text messages a week, emphasizes its ease of use.

“Normal people get this,” said Hecht, who cites church groups and PTAs as some of GroupMe’s not-so-typical early adopters.

TextPlus, a group-messaging app that is popular with teens and now has almost 8 million users, offers themed “communities” to discuss specific topics; there are more than 20,000 groups dedicated to Justin Bieber.

The idea behind group messaging got a vote of confidence March 1 when Facebook acquired Beluga, a group-chat app built by three ex-Google employees.

“It validates the space entirely,” said Hecht. It also means more competition. “If you are a consumer Internet company, whether you like it or not, you will compete with Facebook,” Hecht says.

Investors and entrepreneurs see group messaging as a venue where advertisers and local merchants will be able to interject themselves into people’s conversations, potentially at the very moment they’re deciding what to do or whether to buy something.

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