9 Aug 2009

The Great Text Message (SMS) rip off!

Yup – many of us love to SMS or sending text messages by mobile (aka cell) phone. In fact some of us are addicted to texting and do not know it.

Here is something to think about. If I was to ask you to pay approximately $USD 1000.00 per MB of data transmitted on your mobile phone would you go for that? Probably not – unless you’re Richard Branson or Bill Gates.  But now I’m gonna flatter you. You’re in that league because that’s about the rate you pay to transmit SMS messages!! (especially if you’re texting in the UK).

It’s been worked out that 6554 SMS messages consume 1MB of data. In the UK 6554 SMS messages (the 1MB of data) would cost you on PAYG £655.40! And actually at today’s conversion that’s $USD 1093.61 or $TT 6,915.64 per MB. Now PAYG means you’ve paid for your phone and you normally pay separately for your SMS.

Yeah I know these cell phone operators have to cover fixed and variable costs etc and make a profit - I happen to be qualified in business management so I have fair idea about these things. But really, am I to believe that allowing for a ridiculous 100% profit margin, that it is a fair price to the customer to charge 10p per text? Like no!

Well if you still don’t get it, think about this. Dr Bannister – a space scientist at University of Leicester – has worked out that the rate paid for SMS (based on 5p/sms) is 4 times the cost of transmitting data from the Hubble space telescope!!

But even if the above comparison is wrong, think of the following:

  1. Skype and other chat providers, do not charge for text/chat messages.
  2. Voice conversations via VOIP (e.g. Skype or Google Talk) consume at least about 1MB of data per minute – and most voip providers do not charge consumers a penny for calls.
  3. You can talk (with voice) via Skype for hours at no charge from Skype. Your only charge would be your internet access – which for broadband is usually fixed (cheapest in UK is around £5/month).

So by comparison SMS charges are ‘zillions’ of times more costly than talking by VOIP.

But just compare ‘like with like’. To send 160 characters (say 20 words) would cost 10p on average via a PAYG phone here in UK. And to exchange probably 200 words (in two-way conversation) over a minute of a PAYG call would cost at most 20p (for one minute). So one SMS could be approximately 5 times more costly than a single minute of conversation!! How mad is that? Like, very!! Somebody is lining their pockets. I won’t be helping them. Will you?