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Texting prices rise as carriers make profits

Photo by David Scott. Although the cost of texting to consumers continues to rise, the service to provide is relatively cheap.

The cost of a popular form of communication for students just went up — and is still climbing.

The price of text messaging has doubled since 2005 on every major carrier. Even though the price is rising, users still sent more than 1 trillion text messages in 2008.

Within two years, the price charged by the four biggest carriers for sending and receiving text messages rose from 10 to 20 cents. But, why? A one-minute phone call uses up the same amount of network capacity as 600 text messages.

“The increases seemed to occur in ‘lock step,’” said Senator Herb Kohl, chairman of the Senate’s subcommittee on antitrust, competition policy and consumer rights. “From 10 cents to 15 cents and then from 15 cents to 20 cents, with each set of increases occurring within a period of months or even weeks.”

The four biggest carriers — Verizon, AT&T, Sprint Nextel and T-Mobile — control 90 percent of the cell phone market, with Verizon and AT&T accounting for 60 percent between them.

Lena Dangerfield, 14, of Atlanta estimates she sends as many as 100 text messages some days.

“I don’t really think about how much it costs because I don’t get the bills,” Dangerfield told ABC News.

The family’s cell phone bills tripled when she went from talking to texting. Her parents tried to get her to cut back, but then switched to an unlimited texting plan to avoid any unwelcome surprises.

Michael Hanson, 23, a BYU student from Sandy, said he sends about 200 messages a day.

“As for the cost, unlimited text messaging is the greatest thing in the world in my case,” Hanson said.

In June, senators grilled the wireless industry about how much it costs to transmit text messages, versus how much companies are charging consumers.

One researcher who testified before the Senate committee estimated it costs wireless providers three-tenths of one cent to transmit a text. And the carriers just raised their text price to 20 cents. That quadruples what they charged just four years ago.

“I don’t know why it is so necessary to charge so much,” said Breanne Magelby, 25, from Provo. “I guess the cell phone companies just want money and we are their unfortunate target.”

If you don’t want to sign up for an unlimited texting plan, there are some other ways to cut texting costs. These suggestions come from Alex Curtis of Public Knowledge, a public interest group that works to make sure the American communications system is accessible to all:
Use email to text: all major carriers offer e-mail-to-text gateways that let users send a message via e-mail to a mobile use. Usually the address is just the person’s 10 digit phone number before the @ sign. For example, if you are emailing an AT&T mobile device, you would type in the This saves money for the sender, but the recipient still pays.

Use Instant Messages to text: most of the instant message services have an IM-to-text gateway that works similarly to that of email. To use this via AOL AIM, for example, just type in the “+1” prefix to the regular 10-digit phone number as the contact’s username and it should send the IM as a text message. Again, this saves money for the sender but not the recipient.

Ryan v. (not verified) on Thu, 07/30/2009 - 15:36
Title: This.

Makes me sick. The data usage of a text is so incredibly small they don't lose a dime whether you have 100 or unlimited. Yet here they are changing the prices higher every year. Sure 5 cents a text doesn't sound like a lot but when you multiply it by 50 million customers it sure sounds like a lot more...