Virgin Mobile Lights Up Text 2.0 Powered by 3Jam

I love it when nice guys kick butt. In the real world this is rare enough that flicks like Spiderman and Superman easily blow through a couple hundred million in revenue in their first few days. We need more good guys to kick butt; today that’s something I don’t think anyone cares to argue. For this reason, and because they are both genuinely nice guys I am totally psyched to hear that Andy Jagoe and Enlai Chu, the founders of 3Jam, the company that is redefining the way the world uses SMS, have done more than just a little butt kicking of late. In fact, the news that they’ve signed a seriously high profile deal with Virgin is a whole lotta kicking butt, taking names and generally throwing down in a major way.

NEA, the VC behind the new dynamic duo have to be high-fiving in their boardroom right about now. This is what the entrepreneurial game is all about and it’s these moments of legitimate success that make all the long nights, cold pizza breakfasts, bleary eyed meetings and painful searches for capital all worth while.

Okay, already, I’ll get to the news. Virgin Mobile has just announced (as well as taken live on their website) 3Jam’s next generation SMS service that allows users to go far beyond 1 to 1 text messaging, including chatting with multiple friends at the same time, adding or dropping friends from a 3jam Session and much more. In simple terms the company describes it as “reply-all messaging” where every recipient of a message can send a response that then reaches all the original recipients and the person who sent the message as well.

The deal, which Virgin is promoting heavily on the front page of their site, and apparently via messages to subscribers and in other promotional material as well is big news for a number of reasons besides the fact that the 3Jam Founders are cool people. SMS is the long-standing bread and butter money maker on the data side of mobile telephony. How much money? Informa analysts have pegged the value of global SMS traffic at roughly $60 Billion (yes with a “B”) for 2007. While Gartner analysts go on to suggest that by 2010 1.8 Trillion (yes, like the US deficit) SMS messages will be sent and most of them will be received too.

With such a significant portion of the ARPU (average revenue per user) wrapped up in SMS messaging carriers have been loathe to try and fix something that isn’t broken. Leave it to an enterprise backed by maverick entrepreneur Richard Branson to take a bold step into the future.

Clearly the company has put together that when you make it possible to have a conference instead of a conversation more messages go back and forth and with each message $DING$ another few cents pings into the till. As a user it doesn’t cost you any more to use 3Jam than your standard text messaging rates and 3Jam itself doesn’t charge the user anything at all for the service.

In fact, this is another aspect of this deal which is very interesting and speaks very highly of 3Jam’s prospects. That’s because their bread is buttered at the same time the carriers is vis-a-vis a share of the SMS revenue being generated by their application. This sounds fair to me and I’m sure it sounds fair to Andy and Enlai as well. Not bad for a couple of guys that started this whole thing not much more than a year ago.

I’m sure this will be the first of many such deals to come as other carriers take notice of the extra revenue that’s being garnered by Virgin. It wouldn’t surprise me in the least to see at least one of the big four US carriers as well as more than one big international carrier sign up with 3Jam before spring time.

In fact, I think this might just be the deal that starts shaking up the carriers and forcing them to open their eyes the the vast number of interesting and potentially lucrative applications that have been created by enterprising developers and hard charging entrepreneurs. The “not invented here” closed deck attitude isn’t going to fly much longer and I fully expect that by this time next year it won’t be only the “dynamic duo” but a whole legion of smart creative people who have begun to redefine wireless in ways that make it more useful, more fun, more engaging and even - although we’ve had to drag them kicking and screaming right to the trough, more profitable for the evil-empire carriers that had better see the light before they find themselves heading into it.