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Senator Questions Rise In US Texting Prices

kdawson posted more than 6 years ago | from the competition-what-competition dept.

Government 592

vimm writes "Senator Herb Kohl (D-Wis.) has started an inquiry on the rising prices of text messaging (up 100% since 2005) that has occurred almost in sync with the consolidation of 6 major carriers down to 4. In a letter sent to Verizon Wireless, AT&T, Sprint Nextel, and T-Mobile, Kohl said the increase 'does not appear to be justified by rising costs in delivering text messages.'"

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O RLY? (5, Funny)

Anonymous Coward | more than 6 years ago | (#24953133)

This message just cost me $427 to text.

SPAM (1)

AJNeufeld (835529) | more than 6 years ago | (#24953141)

The only rising cost in text messages is the time (and money) out of the end-user's pocket, to have to read and delete spam messages sent to their mobile phones.

Wag the dog (-1, Troll)

Anonymous Coward | more than 6 years ago | (#24953341)

Who cares. So the costs went from a dime to two dimes. Maybe it is even a blantant example of monopolistic behavior at work.

But honestly, we have much bigger problems to worry about. Bringing this price back down to a dime will not stop the erosion of the American dollar, will not create jobs or raise wages for starving American workers, will not halt the monopolistic practices that continue to destroy the American economy, will not get the real estate market back on track, will not bring our troops home, will not prevent the total collapse of our health care industry, will not do a thing to address the growing identity theft crime wave, and so on.

Once again our representatives quibble over secondary (but showy) BS while the serious issues go ignored.

Re:Wag the dog (1, Funny)

Anonymous Coward | more than 6 years ago | (#24953405)

So all the saved money will just go nowhere? It will have no effect?

props 2 u

Re:Wag the dog (4, Informative)

fiannaFailMan (702447) | more than 6 years ago | (#24953603)

Quite right. And petrol going from $1.10/gallon to $4/gallon is no big deal either, it's only $2.90 worth of difference. There are more pressing issues than gas prices, like healthcare, crime etc.

Re:Wag the dog (5, Funny)

eosp (885380) | more than 6 years ago | (#24953663)

If guns kept people safer we'd be allowed to carry them on commercial flights.

The police: When seconds count, we're there in about eight minutes.

Re:Wag the dog (5, Funny)

Shakrai (717556) | more than 6 years ago | (#24953825)

If guns kept people safer we'd be allowed to carry them on commercial flights.

I must say, I love the logic of that position! Let me try one:

If bottled water kept people safer we'd be allowed to carry it on commercial flights.

Re:Wag the dog (5, Insightful)

Austerity Empowers (669817) | more than 6 years ago | (#24953725)

Or maybe a showy issue that most americans can identify with, will help non-technical americans realize how badly monopolies are robbing them? You know, and I know, that the cost of sending a text message is so incredibly small charging any amount of money beyond voice service is essentially highway robbery. But many people think it's new, and thus must be a huge complicated thing.

Yeah, text messages themselves are stupid secondary problems. But waking people up, and forcing them out of the idiocy of news tv talking heads, and forcing them into the cognitive dissonance caused when they realize businesses are hurting them because capitalism ISN'T working as designed... that helps a lot. Otherwise it sounds like a bunch of pompous academics in suits talkin fancy words and talkin smack about god and the president.

Re:Wag the dog (1)

D'Sphitz (699604) | more than 6 years ago | (#24953817)

So, you're saying that since there are other problems nobody should tackle this one? This reminds me of the argument that we've all seen that law enforcement should have "better things to worry about" than investigating relatively minor offenses like copyright violations while murderers and rapists are walking free.

Cost != price (4, Insightful)

EmbeddedJanitor (597831) | more than 6 years ago | (#24953865)

Like all asynchronous data, texts can be squished into idle network time. In a predominantly isochronous system (voice dominated) there has to be some spare capacity to keep the isochronous flow going. This space capacity can be used to transport text etc. Thus, the network cost of supporting text is zero, or damn close.

But the price they charge customers will depend on what customers are prepared to pay. Network operators charge more, per amount of data moved, for text than they do for voice (a single SMS uses less bandwidth than a second of voice, yet costs about 20x voice on most plans). Since it is waste, they can afford to discount heavily to bulk buyers (who don't mind their SPAM taking a bit longer to get there).

Thus, network operators love text: it converts their waste into something more valuable than their main product. How cool is that!

Rising costs to text? (0)

moderatorrater (1095745) | more than 6 years ago | (#24953161)

What rising cost? Text messages cost about as much as extra minutes (give or take, depending on the carrier), and yet they take much less bandwidth than voice calls. Much, much, much less bandwidth.

Re:Rising costs to text? (1)

winterphoenix (1246434) | more than 6 years ago | (#24953331)

I assume you're talking about the cost to the provider to text. The article is discussing them raising the prices for the consumers' texts.

Re:Rising costs to text? (1)

ArtemaOne (1300025) | more than 6 years ago | (#24953413)

I get unblockable spam texts on occasion, plus my brother texting me even though he has a blackberry and can e-mail me. Each one costs me $10 for the privlidge of being annoyed.

Re:Rising costs to text? (1)

ArtemaOne (1300025) | more than 6 years ago | (#24953441)

$.10 I meant, big difference!

Re:Rising costs to text? (1)

peragrin (659227) | more than 6 years ago | (#24953469)

in the past two years they have gone from $0.05 a message to $0.15 a message for those without prepaid unlimited plans.

they do this because those without unlimited plans only send a dozen or less messages a month and don't care about the dollar or two that gets added on.

Re:Rising costs to text? (1)

Chris Burke (6130) | more than 6 years ago | (#24953565)

Yes, that's kinda the point. The prices are rising, but their costs are not. What aren't you understanding?

Re:Rising costs to text? (4, Funny)

snowraver1 (1052510) | more than 6 years ago | (#24953681)

NO U DONT UNDARSTAND!!!!!1 OMG LOL ITS DA TENAEGRS TAHT R CLOGNG TEH ARETUBS WIT TEH TEXT MESAEGS!11!1 OMG WTF LOL IF TH3Y W3RE ANY CH3AEPR THEY WUD COMPLATALEY CLOG TEH TUBS!1!1!!1 OMG LOL

Re:Rising costs to text? (5, Informative)

AJNeufeld (835529) | more than 6 years ago | (#24953793)

In CDMA, the broadcast from one base-station is divided into many channels ... 1 pilot, 1 sync, 1-8 paging, and up to 61 traffic channels (per frequency channel). Ignoring the pilot and sync, which allow the cell phones to find and synchronize the the system, we have paging channels where the phones watch for messages from the base station letting them know what channel to go to for an incoming call, and traffic channels for those calls.

Into this system, text messaging was bolted on as an afterthought. These are short messages, so they get sent out on the paging channel, since it isn't worth the time and effort to set up a traffic channel, only to tear it down again 80ms later, after the message has been transmitted.

Then came unlimited text messaging plans, and teenagers. "Hi sue! How R U?" [send] "Gr8! Saw Bob at park." [send] "Really? What was he wearing?" [send] "The shirt you bought him!" [send] "Awesome!" [send]. All of a sudden, relatively speaking, the text messaging system volume overloaded the paging channel's regular traffic. Network areas which only ran a single paging channel, suddenly needed to assign more channels to paging. Ok, not a problem, the standard allowed for up to 8. But in areas where a lot of phones were in use already had multiple paging channels. These find themselves in running out of paging channel bandwidth, while large swaths of traffic channels are not in use.

The problem isn't that text isn't cheap to send. It is the standard and the system were developed for voice traffic, and a tiny fraction was reserved for short data messages. The use case of teenagers with unlimited text messaging wasn't considered. To change the standard, and the systems which employ the standard - such as to add more paging channels - will require new phones and/or software upgrades to all existing phones out there, or they'll suddenly not work. It isn't just a matter of upgrading software in the network base-stations.

I Can Think of Possibilities ... (5, Insightful)

eldavojohn (898314) | more than 6 years ago | (#24953171)

Senator Herb Kohl (D-Wis.) has started an inquiry on the rising prices of text messaging (up 100% since 2005) that has occurred almost in sync with the consolidation of 6 major carriers down to 4.

Well, it could be that the competition was driving prices down to a lower level and then after the two consolidated, this (money losing) price reduction natural re-adjusted back up.

Another reason could just be that it's just as easy to sell plans at 10 cents a txt as it is to sell them at 5 cents a txt. We simply don't realize the cost adds up as consumers.

It could also be that people use text messages about twice as much now as they did in 2005 and the hardware just can't take it, so they adjust the price to reduce usage.

I think we've discussed this absurd price before [slashdot.org] . I am quite naive about the whole electrical engineering side to this but well versed in the software of it. If it costs nearly nothing for me to talk for a minute, why couldn't they wrap the txt into a digital signal identical to what our vocal signal is wrapped up in and just let the receiving unit decode it as a special text message across the same audio range (like the old phone modems)?

Re:I Can Think of Possibilities ... (0)

Anonymous Coward | more than 6 years ago | (#24953269)

And not a single one of those possibilities is actually justifiable.

Re:I Can Think of Possibilities ... (2, Insightful)

eldavojohn (898314) | more than 6 years ago | (#24953407)

And not a single one of those possibilities is actually justifiable.

Yeah, I never really said they were. Don't be confused, I wasn't rushing to the defense of the cell phone companies. I've danced the dance of customer support with both AT&T/Singular and Verizon. As far as I'm concerned they can both collapse and I would happily switch to the next in line.

Doesn't stop me from speculating on what might have actually caused this.

I'm glad the senator is asking questions, hell senators should be asking companies questions left and right. It's not like they're suing them. I'm really curious about a lot of companies revolving around the war in Iraq, oil, computers, auto industry, health care, etc.

Unfortunately, I'm sure we're all aware this is just a senator trying to make it look like he's rattling a few cages to look better for re-election in the future. "Champion of consumer rights!" his campaign will read (if it doesn't already). Oh no, an anti-trust suit?! We don't want them to end up like Microsoft when they ... wait, what actually happened to Microsoft?

Wake me up when we actually have a beat down like Ma Bell being divided up into some real competition.

Re:I Can Think of Possibilities ... (0)

Anonymous Coward | more than 6 years ago | (#24953689)


Wake me up when we actually have a beat down like Ma Bell being divided up into some real competition.

You're going to need balming like an Egyptian pharaoh. This is never going to happen again. Companies own our politicians like never before. They don't care about the people, they only want "contributions". The gravy train is going around in circles and it doesn't stop to let the masses on.

Naw. Herb Kohl is one of the good guys. (5, Informative)

RustinHWright (1304191) | more than 6 years ago | (#24953729)

Unfortunately, I'm sure we're all aware this is just a senator trying to make it look like he's rattling a few cages

Actually, afaic, Herb Kohl is one of the few good guys left in Congress. And fwiw, since he's got his own millions of bucks from the Kohl's department store chain, he doesn't need money from anybody. Got his own stash, thank you very much. So while I wouldn't deny that he's a publicity whore (duh! he's a politician!) I would say that it's a safe bet that, oddly enough, he's pushing this in part simply because he's disgusted with the telecom companies.

Now if only HE would run for president.

A man's gotta dream; ya know?

Re:Naw. Herb Kohl is one of the good guys. (1)

eldavojohn (898314) | more than 6 years ago | (#24953787)

And fwiw, since he's got his own millions of bucks from the Kohl's department store chain, he doesn't need money from anybody.

Then who will champion the horrible abuse of consumers from retail department stores?!

Re:I Can Think of Possibilities ... (1)

cfulmer (3166) | more than 6 years ago | (#24953801)

No. Senators should leave well enough alone. This is just politicians trying to get the cell companies to pony up more campaign donations.

So what if SMS prices have gone up? We have an FTC and a Department of Justice which are tasked with antitrust enforcement, and they have a cadre of economists who analyze these things. Why does Herb Kohl think he knows any better?

It could easily be that SMS messages are not very price elastic -- even with SMS, the phone service is the lion's share of the cost. It could be that phone companies reduce the price of phone service and increase the price of messaging.

Re:I Can Think of Possibilities ... (1)

The MAZZTer (911996) | more than 6 years ago | (#24953387)

this (money losing) price reduction natural re-adjusted back up.

Not possible. If it was, they'd REALLY be losing money with the higher-bandwidth voice calls which are cheaper. No, they're making almost pure profit from SMS.

Re:I Can Think of Possibilities ... (5, Informative)

Like2Byte (542992) | more than 6 years ago | (#24953403)

I used to work for one of the large telecommunications companies. 161 bytes plus a little bit of HTTP header overhead is nothing. Practically everything performed on today's cellphones is completed via HTTP commands - most are clear-text. Usually, the only thing NOT encrypted is the NAI of user of the phone.

It just doesn't ring true to me that text messages are eating up their bandwidth even if the scale of their customer base is increased with the next purchase of the next cell-co.

It's greed - plain and simple.

That's my 2 cents.

Re:I Can Think of Possibilities ... (0)

Dolohov (114209) | more than 6 years ago | (#24953587)

The only thing that makes me wonder is that a dropped packet from a phone call is nothing, but a dropped packet from a text message is the entire messages -- does the need to provide a 0% error rate drive up the difficulty?

Re:I Can Think of Possibilities ... (1)

Hyppy (74366) | more than 6 years ago | (#24953827)

Why the need to provide a 0% error rate? I don't know whether SMS is sent UDP or TCP (or if it is even a TCP/IP application), but haven't we already figured out how to reliably send this stuff over unreliable mediums? UDP can be solved with a simple acknowledgment, and TCP is inherently reliable.

Re:I Can Think of Possibilities ... (1)

Dolohov (114209) | more than 6 years ago | (#24953851)

Right, but if they've already geared their network toward phone calls, it might be a pain in the ass to have other traffic that needs to be delivered reliably.

I'm not saying it's a GOOD excuse, just a possible partial excuse.

Re:I Can Think of Possibilities ... (3, Funny)

JordanL (886154) | more than 6 years ago | (#24953591)

You mean your 25 cents.

Re:I Can Think of Possibilities ... (1)

McBeer (714119) | more than 6 years ago | (#24953639)

It's greed - plain and simple.

That's my 2 cents.

Good thing you didn't text message that post. Would have been your 80 cents in that case.

Re:I Can Think of Possibilities ... (0, Redundant)

DaveJay (133437) | more than 6 years ago | (#24953709)

> That's my 2 cents.

Actually, that's your 4 cents (up 100% since 2005.)

Re:I Can Think of Possibilities ... (1, Interesting)

Anonymous Coward | more than 6 years ago | (#24953769)

I used to work for one of the large telecommunications companies. 161 bytes plus a little bit of HTTP header overhead is nothing.

Most carriers don't use HTTP for SMS, but that's a different issue.

The cost of sending an SMS is not very high despite the infrastructure they need for porting the data between providers domestically and internationally. There's a platform behind that coordinates the interchange for people that costs a lot of money.

Despite the cost of the software to run it, the SMS part of the mobile phone business is the largest profit center right now.
It's worth hundreds of billions of dollars to phone companies and they will vigorously defend their pricing.

Ah Possibilities ... (1)

michaelepley (239861) | more than 6 years ago | (#24953755)

Hey this is fun...I can speculate on a lot of possibilities too *cough* collusion *cough*!

But aside from randomly guesses, there is one thing I know for sure: in a competitive market, costs to the consumer are driven to down to the cost of production. We all know reading slashdot the cost to make a text message is approximately nothing. Ergo, something is seriously wrong with the market here.

Re:I Can Think of Possibilities ... (0)

Anonymous Coward | more than 6 years ago | (#24953845)

A text message costs nowhere near the amount to send over the cell phone network as a single second of voice. There is no reason for the insane price except that people seem willing to pay it.

Cynical (4, Insightful)

Hatta (162192) | more than 6 years ago | (#24953177)

Sounds like the Cellular industry hasn't been contributing enough to a certain Senator's campaign.

Re:Cynical (1)

faloi (738831) | more than 6 years ago | (#24953295)

It's not so cynical when you look at what contributions did for telecom immunity. Maybe somebody just feels left out.

Re:Cynical (5, Interesting)

daeg (828071) | more than 6 years ago | (#24953375)

For other senators, maybe. Look at Khol's record, though, and you'll see he's generally far more pro-consumer protection than nearly any other Senator.

Re:Cynical (0)

Anonymous Coward | more than 6 years ago | (#24953637)

Khol is well love and wealthy. While I'm sure donations help, he doesn't have to rely on lobbyists.

Are you interested in this story? (5, Funny)

Gizzmonic (412910) | more than 6 years ago | (#24953179)

If so, text "Text" to 8398 for updates! Standard text messaging rates apply!

Re:Are you interested in this story? (3, Interesting)

Aphoxema (1088507) | more than 6 years ago | (#24953537)

Holy crap, just imagine if you had to pay for every comment on Slashdot, even the anonymous cowards that don't say anything useful, much like the advertisements I get about four times a week now because some assholes thought it would be +1 Funny and +1 Informative to randomly stick my cell phone number into all those stupid sites.

off-peak? (5, Insightful)

Dolohov (114209) | more than 6 years ago | (#24953181)

Another interesting question: my phone service (through Verizon) has free after-hours calling, but I pay the same rate for text messages and other data services regardless of time of day. Surely if the data from my phone call is cheaper to transmit at 10pm, then the data from my SMS message is too?

Re:off-peak? (5, Insightful)

retchdog (1319261) | more than 6 years ago | (#24953327)

Why do intelligent people persist in applying rationality to these questions? Is it purely a strategy to re-frame the public debate in vain hopes of changing the situation?

Text messages are either marked-up several thousand percent or infinitely, depending on your analysis. What is the point of expecting the consumer price of texts to respond at all to real costs, when the provider cost varies by at most thousands of a cent?

Re:off-peak? (5, Insightful)

maxume (22995) | more than 6 years ago | (#24953411)

They didn't promise to charge you based on their costs.

The problem with cellular competition in the US isn't collusion or some other nonsense, it is that people are happy to participate in a model where they are always paying (at a pre-negotiated rate) for more than they are using.

If people weren't happy to shovel $1200 a year to the phone companies for unlimited use, the price would be a lot more reflective of what it costs to provide.

Dammit, Kohl! (4, Funny)

eln (21727) | more than 6 years ago | (#24953191)

Herb, we told you the check was in the mail, why can't you be more patient? I have to warn you if you continue on this track future checks may be even slower to arrive. I'm sure you'll start to see things our way very soon.

Sincerely,
AT&T

hmm (0)

Anonymous Coward | more than 6 years ago | (#24953197)

I guess our senators have nothing more important to discuss.

Price-fixing? (3, Interesting)

langelgjm (860756) | more than 6 years ago | (#24953219)

Kohl said he is particularly concerned that all four of the companies appear to have adopted identical price increases at nearly the same time. "This conduct is hardly consistent with the vigorous price competition we hope to see in a competitive marketplace," he wrote.

I wonder if things will get as far as a price-fixing investigations?

Okay, so I'm a crabby liberal (3, Insightful)

smellsofbikes (890263) | more than 6 years ago | (#24953237)

Yeah, that sucks. Text messaging should be dirt cheap. Yeah, they're making an enormous profit off it.
But text messaging is voluntary. You can stop any time you want. They're clearly charging what the market will bear.
Sure, it makes them look like scum when they're getting paid huge amounts for not doing very much... but c'mon, Senator Kohl, that's the American Dream! If y'all don't like it, get rid of your cellphones and use email.

Re:Okay, so I'm a crabby liberal (4, Insightful)

BlackGriffen (521856) | more than 6 years ago | (#24953283)

Except you get charged whenever somebody sends you a txt. Not cool.

Well, that's the wireless business model... (1)

ElboRuum (946542) | more than 6 years ago | (#24953389)

If someone calls you, you pay. If someone texts you, you pay. If no one does anything and you don't have a rollover plan, you lose your minutes and, ergo, you pay. We are far removed from land line days where only the initiator of the action paid for the action and if you didn't make LD calls and you had unlimited local calling, your bill was about the same each month.

Re:Well, that's the wireless business model... (2, Insightful)

Ares (5306) | more than 6 years ago | (#24953559)

If someone calls you and you choose to answer it, you pay. If someone texts you, you pay.

fixed that for you.

Re:Okay, so I'm a crabby liberal (1)

LandDolphin (1202876) | more than 6 years ago | (#24953449)

I'm sure some/most of them have plans for unlimited for $5 a month. if not then Switch carriers.

Actually, they're not... (1)

ElboRuum (946542) | more than 6 years ago | (#24953287)

Actually, they're not charging what the market will bear. They're banking on the idea that the 13-year-old who texts his/her friends 100+ times a day and who's on their parents calling plan will have parents too milquetoast to cut off their text service.

Re:Actually, they're not... (2, Insightful)

bill_mcgonigle (4333) | more than 6 years ago | (#24953429)

Actually, they're not charging what the market will bear.

you just described 'the market'.

Re:Actually, they're not... (1)

iamhigh (1252742) | more than 6 years ago | (#24953471)

That is the perfect example of "what the market will bear". Thanks.

Re:Actually, they're not... (1)

Qzukk (229616) | more than 6 years ago | (#24953731)

That is the perfect example of "what the market will bear". Thanks.

You're welcome, oh, and my reply to you costs $500,000. Thanks for bearing the cost.

Re:Actually, they're not... (1)

Hyppy (74366) | more than 6 years ago | (#24953863)

If the market couldn't bear it, then the parents wouldn't allow their children to send text messages, whether through disallowing the service through contract or *gasp* parenting!

Re:Okay, so I'm a crabby liberal (5, Insightful)

Hatta (162192) | more than 6 years ago | (#24953483)

Usually it's conservatives who argue for the free market to sort things out, and liberals want increased regulation.

Anyway, it would be good to let the free market sort this out. The fact that it hasn't implies that the cellular market is not free. Free markets work because of competition, the high prices of text messages indicate that there's no competition in that market. That's not a good thing, regardless of which side of the aisle you identify with.

Re:Okay, so I'm a crabby liberal (1)

GodfatherofSoul (174979) | more than 6 years ago | (#24953857)

I'm by no means a free marketer, but the point is that as market shares increase, competition decreases, and prices increase. This IS the free market at work.

Free Market (4, Insightful)

copponex (13876) | more than 6 years ago | (#24953809)

Companies only believe in the free market when it suits them, so they don't deserve it. The only way to keep prices low is to intelligently regulate and keep the corporations small and relatively powerless so they don't have the resources to buy their way into the government's good graces.

Without stiff and proper rules keeping corporate interests separate from government interests, you always end up with corrupted governments relaxing regulations and robbing public resources for private profit, or as they like to call it, privatizing. Notice under the Bush administration that all of the deregulation and plundering of public property has resulted in a highly unstable economy. When you eliminate so many rules that the only thing stopping the resulting mega corporation from ripping people off are the inherent ethics guiding a company, you'll quickly be reminded that the only moral standard they answer to is the bottom line.

It's election time... (4, Interesting)

erroneus (253617) | more than 6 years ago | (#24953257)

Issues that matter to people will always get raised during election time. The price of gas will drop dramatically pretty soon just before the election and there will not be any connection to world events. It happened times before and will happen again. Everyone knows Oil Industry == Republicans and the easiest way for them to gain favor is to relieve people with lower gasoline prices for a short while.

But these tactics aren't limited to the price of gasoline... we will see more issues like the price of texting or all sorts of other nonsense that people can rally behind. It is unfortunately a part of the game and typically, even though people get excited about the apparent intention to reign in some justice and sanity, almost nothing ever really happens... except, perhaps, additional contributions from the accused industry.

And we're suprised by this why? (3, Informative)

BlackGriffen (521856) | more than 6 years ago | (#24953263)

The amount of data in a txt, maybe a kb or so with overhead, should be virtually free to transmit compared to voice traffic. This is especially true since the voices are digitized and handled as data.

In other words, they've been a price gouge from the start, and we're surprised when the companies try to push the envelope to get as much out of the gouge as people will put up with?

I've got a bridge to sell you...

Re:And we're suprised by this why? (1)

ShadowRangerRIT (1301549) | more than 6 years ago | (#24953599)

Particularly since text message data doesn't need to be real time. Voice data needs to transmit effectively instantaneously; text data can wait for the network load to lower since there is no guarantee of speedy delivery.

Since the costs for equipment are essentially fixed, but the revenue is proportionate to utilization, text messages are perfect for smoothing the usage over time. Unless the text messages are so numerous that the phone companies are upgrading equipment to deal with them (above what they need for voice calls), then they are free.

Re:And we're suprised by this why? (5, Insightful)

RickRussellTX (755670) | more than 6 years ago | (#24953895)

The amount of data in a txt... should be virtually free to transmit compared to voice traffic... they've been a price gouge from the start

You're talking to a society of people that will spend $1.25 for a bottle of water out of a vending machine which is sitting right next to a water fountain.

Prices will go down when people stop using the service.

20 cents? (1)

Otter (3800) | more than 6 years ago | (#24953285)

I'm pretty much the least informed mobile phone user on the planet. (I bought some Nokia phone with a bundled prepaid card, because my wife made me, and barely use it. I wrote the number on the back of the phone because otherwise I'd have no idea what it is.) And I'm only paying 10c to send texts and 5c to receive! And that's current, because I just looked it up, after looking at the phone to remember what company I'm with. Who is paying 20c?

Re:20 cents? (1)

bill_mcgonigle (4333) | more than 6 years ago | (#24953365)

Who is paying 20c?

That's the Verizon price (or is it 25 cents?) if you're not pre-buying 'plans'. It used to be cheaper but they raised prices to force people into buying text plans. I recently succumbed because I get enough nagios messages to make it cost half to buy the basic plan.

SMS Prices Not Cost-Plus (4, Interesting)

bill_mcgonigle (4333) | more than 6 years ago | (#24953309)

SMS prices are not based on what they cost to deliver they're based on what the market will bear. Downloading an mp3 over SMS would cost over 5 grand [mobilemessaging2.com] .

I'm not sure there's so much collusion as a majority of people willing to pay insane prices for texting, and cell phones in general. I recently found a cell phone bill from about 10 years ago - it was $9.99 per line (times 2) plus tax (I got a local big-employer discount, the regular rate was $14.99 per line). It came with, I think 120 minutes, which is all I ever use anyway. My current Verizon bill is now easily $85/mo for two lines with a basic text package. Sure, there's been inflation, but there's also less competition.

I understand that in countries where the service providers are separated from the equipment providers the competition is fierce. I'm not sure but I'd guess that it's because people can jump from provider to provider on their non-crippled phones.

The answer: (3, Informative)

faedle (114018) | more than 6 years ago | (#24953315)

"Because we can."

My employer pays huge text messaging bills, mostly because they view the 10 cents a text message costs to be a non-starter. Even with the average user sending 100-200 messages, that only tacks on $20 to the average cell phone bill.

And believe me, at my company, each phone is easily a $150/month bill.

When you're billing out engineers at $200/hour, another $20 on the monthly bill is nothing. I'd guess that the average high-volume cell user is typically not watching the nickels and dimes on the statement.

Suddenoutbreakofcommonsense (1)

NoobixCube (1133473) | more than 6 years ago | (#24953319)

Although that's one of the most overused tags on Slashdot, and it's rarely applicable, this is definitely a case where it should be tagged as that. I don't think I can since I'm not a subscriber, though.

Q & A (2, Insightful)

fahrbot-bot (874524) | more than 6 years ago | (#24953329)

Q: Please justify the "sharply rising rates" you're charging people to send and receive text messages.
A: Choose one or more:
  1. Because we can.
  2. Because we're greedy.
  3. See: Capitalism [wikipedia.org]

Make it free (1)

jimbogun (869443) | more than 6 years ago | (#24953363)

Text messages should be free. The bandwidth required to send a text message should be ridiculously low. I can understand the desire to recoup development costs of the service, but I think this is the cell phone carriers way of tapping in to the elusive younger crowd's wallets to spread their income across a larger spread of services.

Cell phone carriers should provide this as a free service to entice subscribers to switch to them. I predict this will go the way of the ATM fees once one major service provider starts promoting it. I can see the campaign now, likening it to freedom. "Those other evil companies want to suppress your freedom of text! Not at X carrier, let freedom ring!"

Go the way of the ATM fees? (1)

ElboRuum (946542) | more than 6 years ago | (#24953463)

Which way did they go? They're still around and have only increased.

Re:Go the way of the ATM fees? (1)

jimbogun (869443) | more than 6 years ago | (#24953813)

I meant more for the "cash back" fee from the supermarket. Not all banks have given up on all ATM fees, but there are ways around it or I can usually find a bank that is in my bank's network.

According to Wikipedia: (http://en.wikipedia.org/wiki/ATM_usage_fees#United_States)

"While many consumers are faced with multiple fees as described above, a number of standalone and internet banks, such as USAA and E-Trade Bank, and Ebank among others, not only do not charge their customers for using another ATM but they also provide reimbursement, worldwide, of another ATM's fee. Thus, customers at some banks in the US can avoid ATM fees altogether. Another popular way to avoid paying ATM fees is to make a "cash back" purchase at a retail store: many retailers will allow a customer who is paying with a debit card to withdraw more than the total due the retailer and get back the difference in cash."

Re:Go the way of the ATM fees? (1)

Chirs (87576) | more than 6 years ago | (#24953877)

I do most of my banking at a bank with no human tellers, better than average interest rates, and no ATM fees.

Re:Make it free (0)

Anonymous Coward | more than 6 years ago | (#24953531)

Text messages should be free.

You want your phone full of spam?

I don't mind paying for the service. Not one bit. I don't care how cheap they managed to make it to provide the service. I'll pay for it, so long as the damn spammers have to pay for it too.

I think it should be much pricier to send than receive though. Sending should be a dime or more, and receiving should be zero or one cent.

Re:Make it free (1)

jimbogun (869443) | more than 6 years ago | (#24953671)

Computers can send text messages for free. Do you really think the spammer is burning through his cell phone keypad texting a million people? Locking out computers from the cellphone networks could be one possible solution, but I like getting texts from friends using an instant messenger.

Re:Make it free (1)

Ares (5306) | more than 6 years ago | (#24953631)

I can understand the desire to recoup development costs of the service, but I think this is the cell phone carriers way of tapping in to the elusive younger crowd's wallets to spread their income across a larger spread of services.

except that the development of the sms system started in 1985. if they're raising rates now to recoup development costs, it was a project that failed miserably from the get-go.

Re:Make it free (1)

MarkvW (1037596) | more than 6 years ago | (#24953661)

You're a funny man!
Give something away for free that people will pay money for? Ha! Ha!

Why? (1)

Kabuthunk (972557) | more than 6 years ago | (#24953395)

Why have prices increased so much in the past few years?

Simple... because people will pay that much.

Which is exactly the reason it will continue going up.

Re:Why? (1)

cowscows (103644) | more than 6 years ago | (#24953867)

It's sort of a reverse chicken-egg problem. Why will people pay that much? Because they need it and that's what it costs. Why does it cost that much? Because that's what people will pay for it.

Text messaging should basically be a commodity at this point. And a commodity that for all intents and purposes is unlimited. The fact that the cost is going up almost from all providers almost certainly indicates that a lack of competition is allowing entrenched providers to raise their prices with no fear of customers going anywhere.

Glad to see a senator doing something (1)

drewzhrodague (606182) | more than 6 years ago | (#24953423)

Excellent! I'm happy to see a senator doing something for the people. Unfortunately, I am not one of his constituents. I'll bet he has kids or grandkids that do lots of SMS messaging, and has noticed the increase in the bills. I wonder when a senator is going to get pissed off at Comcast.

At least make incoming SMS free (1)

ilovesymbian (1341639) | more than 6 years ago | (#24953457)

At least make incoming SMS free. I get so many requests for money transfer SMSes from Nigeria and Togo.

I spent over $50 in text overages last January, so I got the $30 unlimited Family Messaging plan from AT&T. That worked.

In Asia, they have incoming SMS free, why not do it in other areas as well?

Re:At least make incoming SMS free (1)

Sockatume (732728) | more than 6 years ago | (#24953875)

Free incoming SMS is the norm in Europe too.

I for one welcome... (4, Funny)

drewzhrodague (606182) | more than 6 years ago | (#24953459)

I for one welcome our Questioning Senator Overlords!

Dear Senator Kohl, (5, Funny)

Caboosian (1096069) | more than 6 years ago | (#24953467)

We respectfully take your concerns into consideration, and present you with this money basket. We hope that this free donation to your re-election campaign, brand new BMW, and lakehouse are enjoyed thoroughly by you! Thank you for ceasing your inquiry - err, we mean, thank you for invariably enjoying our gifts!

Love,

The Telcos

In coming need to be free as well having 1-800 txt (2, Insightful)

Joe The Dragon (967727) | more than 6 years ago | (#24953519)

In coming needs to be free as well having 1-800 text numbers that are 100% free and the 1-900 based ones should just have there fees not fees + the standard rate.

only so long (0)

Anonymous Coward | more than 6 years ago | (#24953523)

dude texting is FREE.
after a decade of rip-off, sending
a bunch of ascii chars is free.
the mobile phone was invented ... 80 years ago?
gawd i can post free on /.

Is T-Mobile any good? (0)

Anonymous Coward | more than 6 years ago | (#24953553)

I have been paying way too much for way too long. I use like 5 minutes a month and pay about $30/mo. I have been wanting to go to one of those pre-paid phones and get my monthly payment way down. Unfortunately all the pre-paid plans minutes expire way too fast and such so you end up not really saving that much. I believe T-Mobile has a $10 90-day thing though so I have been thinking about that. Any good?

T-Mobile is also one of the very few providers I have found that have a pre-paid Nokia phone. I have tried about every phone out there and it seems only Nokia has the stuff I want:

  • The whole phone can be set to 24-hour/military time (including setting the alarm(s) and calendar)
  • the quick-select silent/vibrate mode can be set to automatically time-out and go back to normal
  • *** most important is that kick-ass ring tone that starts quiet and gets louder and louder

I have never seen any phone other than Nokia that even has one of those features.

Good thing (1)

guyminuslife (1349809) | more than 6 years ago | (#24953567)

Nonsense. We need to slap a "vice tax" on text messages, like we do on cigarettes and alcohol, to discourage their use. At $20 a text, perhaps the world will finally be free of this insidious evil.

Mod me down to -1, Troll, please.

Re:Good thing (1)

Penguinoflight (517245) | more than 6 years ago | (#24953745)

Insinuating that cigarettes and alcohol are under vice taxing is trolling. The medical costs associated with both are astronomical, and the federal government ends up paying indirectly somehow.

That said, everyones costs are higher due to cell phone use. More auto wrecks, longer commutes to work, more hours wasted at school due to lower average intelligence...

It seems like half the time I see someone make a stupid move in traffic it's because they're on their cell phone, the other (well, both really) half just doesn't care.

Bend over if you want to send a text message (1)

itpr15061 (844859) | more than 6 years ago | (#24953615)

The actual cost of text messages to carriers is a joke but they charge us like there's some super hard technological feat. Consider: 160 byte maximum, and assume you can send them for a low low price of 5 cents a message. 1,024,000 / 160 = 6400. 6400 * .05 = $320 a megabyte.

What a ripoff. I'm all for paying for services, but the carriers are clearly sticking it to us. I can send a picture message for a quarter (5 times the cost of a text message), and I can guarantee that every image I send is more than 160 * 5 or 800 bytes, and it goes across the same network.

It makes me grumpy.

I'd rather see (1)

Mesa MIke (1193721) | more than 6 years ago | (#24953641)

Government do something to encourage free-market competition among the carriers in order to bring prices down.

Having government artificially limit how much profit texting can generate for the carriers will not do anything to help improve service.

Texting is not a basic human right.

Dear Sen. Kohl (1)

RulerOf (975607) | more than 6 years ago | (#24953691)

Ahem,

the increase does not appear to be justified by rising costs in delivering text messages

No shit sherlock.

So build your own, Senator (1)

mi (197448) | more than 6 years ago | (#24953761)

Are we suspecting, these guys have formed a trust [wikipedia.org] to keep the prices same and/or rising? No... With 4 players, any one of them can hardly be called a monopoly either.

Then leave them alone and don't engage in price-control, Senator. Better yet, build your own wireless company — if you charge less for the same services without sacrificing other aspects, people will flock to you in droves...

I'm probably one of the few... (1)

DanWS6 (1248650) | more than 6 years ago | (#24953811)

Who wish I could disable text messages on my phone. I wish I could activate a feature so when someone sends me a text message I don't see it and they get a response telling them to just call me.

ROW ROW FIGHT THE POWAH (0)

Anonymous Coward | more than 6 years ago | (#24953847)

ROW ROW FIGHT THE POWAH

Why worry about texting? (1)

kuzb (724081) | more than 6 years ago | (#24953883)

I mean, shouldn't we be looking at the ridiculous airtime charges? Roaming fees? Unreasonable cellphone plans? Compared to all that, texting just seems minor.

Dear Senator Kohl, (1)

bill_mcgonigle (4333) | more than 6 years ago | (#24953887)

I'd like you to justify the sharply rising costs of the Federal government.

I'm concerned that rising debt, deficit, and the size of government programs reflects decreasing adherence to the laws that grant power from the people to said government. I'm concerned that citizens are paying more than 3.2 trillion Dollars to fund the government this year, up from 1.8 trillion Dollars in 2000.

This increase does not appear to be justified by rising costs of administering a constitutionally authorized government. I am particularly concerned that both of the major political parties appear to have adopted identical spending attitudes at nearly the same time.

This conduct is hardly consistent with the vigorous competition of ideas we hope to see in the 'Laboratory of Democracy'."

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