Guess What Texting Costs Your Wireless Provider? [Telecom]

Guess What Texting Costs Your Wireless Provider?

By Eric Bender Thursday, Sep. 10, 2009

When my teenage son ignores me while tapping away furiously on his cell phone, I have the consolation of knowing that he has joined the quickest-growing form of two-way communication in human history. A decade ago, just about no one in the U.S. sent these messages, known as Short Message Service (SMS) texts. This year, we will zing out 1.2 trillion of them, predicts market-intelligence firm IDC.

That translates to a barrage of messages from each user, especially teens, who seem to be receiving new text messages - a.k.a. "blowing up" - more than they take new breaths. The average U.S. mobile teen now sends or receives an average of 2,899 text messages per month, according to Nielsen Mobile. "With teens, the act of picking up a phone and calling someone is dropping away," notes Christopher Collins, a senior analyst with Yankee Group.

What's most amazing about the texting craze is just how inexpensive it is for mobile carriers to provide this wildly popular service. SMS messages are not only extremely short (maxing out at 160 characters), but they also cleverly exploit today's digital phone networks, leveraging transmission channels between phone and cell tower that were originally designed to coordinate voice calls. "They cost the mobile carriers so little that you could argue that they're free," says Collins.

That situation set antitrust alarm bells ringing when AT&T, Sprint, T-Mobile and Verizon all raised their pay-per-use costs of sending a text message from 10 cents to 20 cents over the past three years. That prompted Senator Herbert Kohl, the Wisconsin Democrat who chairs the Senate Judiciary Committee's subcommittee on Antitrust, Competition Policy and Consumer Rights, to hold hearings on the matter in June.

At those hearings, Srinivasan Keshav, a professor at the University of Waterloo in Ontario and an expert on mobile computing, presented a detailed analysis of all the expenses that carriers incur in handling SMS messages. He showed that the wireless channels contribute about a tenth of a cent to a carrier's cost, that accounting charges might be twice that and that other costs basically round to zero because texting requires so little of a mobile network's infrastructure. Summing up, Keshav found that a text message doesn't cost providers more than 0.3 cent.

...

formatting link

Reply to
Monty Solomon
Loading thread data ...

[Moderator snip]

So, was this a "feel good" hearing, or is anything going to become of it?

***** Moderator's Note *****

Senator Kohl was reelected in 2006, so he's not on the stump at the moment. However, I doubt any legislation will be filed, since the Senate is dealing with President Obama's Health Care reform initiative.

Bill Horne

Reply to
Sam Spade

Long, long ago AT&T's long distance wires also carried telegraph signals along with voice signals since the telegraph frequency was well below voice frequency and was easily separated out, plus its bandwidth was narrow.

One could've said the same thing about telegraph over voice lines. But it was not "free". Telegraph circuits still required loops to a central office and toll lines required terminal equipment to filter out and distribute telegraph and voice signals to the proper places. If memory serves, loading coil and repeater amp utilization on a toll line had to be modified to accompany the telegraph signals. All that was a cost.

While I have no great love for the wireless carriers, carrying text messages still involves a cost of channel capacity, switching gear, sending equipment, and terminal equipment. I wonder what happens when a large middle or high school lets out at the end of the day and nearly every kid is texting away simultaneously. I suppose they queue, store, and later forward messages when capacity is reached, but that requires a software and hardware solution.

As to anti-trust issues with cellphone companies, I'd like to know why none offers a low-use phone where the minutes do not expire. Many people would like to have a phone for very occasional use and no user maintenance, but pre-paid phones require buying minutes that require if not used and end up being almost as expensive as a regular line. Seems to be a low-use plan might be $15/month with a $1/minute when used.

Reply to
hancock4

But that's higher than what it costs now. T-mobile prepay is $25/130 minutes with a 3 month lifetime (but time rolls over if you refill before then) or $100/1000 min. with a year lifetime. Either of those is a far better deal than you propose. PagePlus (and perhaps others) also has inexpensive deals.

Me, I always lose the phone before then.

Dave

Reply to
Dave Garland

To the best of my knowledge, the company that comes closest to this is Tracfone. For $20, you buy a magic number to feed to your phone that adds 60 minutes and extends your "subscription" by 90 days.

As long as you keep your subscription alive, the minutes never expire. You can add those 90-day extensions at any time; they extend your current expiration date by 90 days, so you lose nothing by doing this early.

This gives you a low-usage plan for roughly $6.75 a month.

Reply to
Ron

T-Mobile actually has a $10/90 day refill. As far as I know, it's the best bargain in standby phone service.

Reply to
David Lesher

I have Virgin Mobile, it's even cheaper. It's $20 for 3 months if you top up manually, but if you let them top you up automatically whenever you're running low, it's only $15 for 3 months. When you use the phone it's $0.25/min for the first 4 minutes in a day, $0.10/min for additional minutes that day.

Reply to
Barry Margolin

Virgin Mobile has a similar plan. The trick with either of these is to check the coverage. IIRC Virgin uses Sprint's network and TracFone uses Verizon in most locations.

***** Moderator's Note *****

I use Virgin Mobile too, and can confirm that they use the Sprint PCS network. In the US, coverage gets spotty outside major metro areas.

Reply to
Robert Neville

I'm currently on a $100 365 day plan with Virgin Mobile in Canada. Along with my starting $25 or $30, or whatever it was I'm now down to $95 and have had the phone since December. So I've used about $35 in 10 months at a rate of 30 cents per minute and same again for long distance if applicable.

I'm their worst nightmare. Hehehehe

BTW I don't mind paying the 30 cents per mniute for my usage. However 30 cents for long distance is ridiculous. It should be more like 5 or 10 cents per minute. Telus's, the local telco is 4 cents per minute anywhere in Canada or the US.

formatting link
Mobility, their cell division, also charge 30 cents per minute long distance on prepaid cell phones.

Tony

Reply to
Tony Toews [MVP]

You can add a OneSuite Canadian access number to your Virgin [or any other Canadian cell phone] for long distance as low as 2¢ a minute Local access in Toronto, Vancouver+ Or Canadian 800# for higher rate: I use them here in USA on my home phone.

I understand that Virgin Canada phones will not work in USA, And USA Vrigin will not work in Canada. Is that correct?

Reply to
www.Queensbridge.us

Do you have a specific URL for how this works with Virgin Mobile phones conveniently? Or is this a generic feature that works with all prepaid long distance calling cards requiring you do dial a number, enter your (I'm sure loooong) PIN, and then enter the phone number you really wanted to dial?

AFAIK all Canadian prepaid phones do not work in the USA and vice versa. But postpaid Canadian phones do work in the USA and vice versa. Although frequently at obscene roaming rates and ridiculous charges just for entering a roaming area.

Tony

Reply to
Tony Toews [MVP]

Not so. Fido and Rogers prepaid will work in the US. It just costs a whopping $1.45/minute to roam in the US. I assume that's CA$1.45/minute though the difference between CA/US $ is not that much different these days.

By contrast T-Mobile in the US charges 69/minute to roam in Canada.

I was just reminded of this when I switched on my Fido phone when I came back from an overseas trip. I got a courtesy text message from Fido with the reminder that it's $1.45/minute to roam in the US.

Reply to
Joseph Singer

[That is] ridiculous. AFAIK you can purchase a new prepaid US phone for $10 with a $10 air time included. If I spend any time in the USA I'll just purchase one of those and leave it and the charger somewhere near the border when I exit the US.

Tony

Reply to
Tony Toews [MVP]

Indeed, but it doesn't have your phone number that everyone knows. That's always the tradeoff with getting a local SIM.

R's, John

Reply to
John Levine

One's domestic number will go to voice mail, upon which one would record the temporary number one is using, emphasizing that it's for calls that cannot wait till such and such a date when one will return from the business trip.

What's the big deal? "Everyone" doesn't have to reach one immediately while out of the country. One especially doesn't want to hear from people who refuse to appreciate the time zone difference and when one is likely to be awake.

***** Moderator's Note *****

Kudos to "The Deathstar": AT&T Long Distance has been warning callers about time-zone differences for a while, and it has saved me from some embarassing calls.

Bill Horne Moderator

Reply to
Adam H. Kerman

You are correct. In my own mind I have figured things out but neglected to communicate those thoughts.

In my situation I only use my cell call for family and emergencies. Most of my clients communicate with me through email or initiate contact via email. And I do not give them my cell number, with one or two exceptions, as business applications problems are not emergencies.

Thus once I purchase and activate the US cell phone I email two or three key family members with my US cell phone number. And they'll pretty much only call if there is a death or severe medical problem in the family.

Tony

Reply to
Tony Toews [MVP]

I have programmed special numbers to ring differently and have learned to subconsciously ignore rings that are not distinctive. Thus, I don't have a problem with people phoning me when I'm asleep. In fact, [even] when I'm awake, I'm sometimes surprised to find that I slept through a junk sales call.

Reply to
David Kaye

Here's Onesuite url ->

formatting link
Onesuite has Canadian local access numbers to Montreal, Vancouver, Toronto. If you have a Onesuite account and use these local access numbers then the rates for calling Canada is 1.9c per minute and US for 2.5c per minute. You can set up your Onesuite account for a PIN-less dialing and there's also an online phone book where you can register your 50 most frequent called numbers and specify a 2 digit code. So you can call much faster - Canada Onesuite local access number + 2 digit code. Instead of Access number + PIN + 10 digit phone number.

HTH

Reply to
Zee

Cabling-Design.com Forums website is not affiliated with any of the manufacturers or service providers discussed here. All logos and trade names are the property of their respective owners.