The True Cost of SMS

Just a straight repost here to share with you from Phil Barrett. Great info about SMS and the actual costs to the carrier associated. What do you think? Will mobile carriers be forced to eventually change the way they do business? In what ways? Here is his post:

The New York Times reported last week that the true costs of text messaging (or SMS) to carrier is effectively zero.  This is curious as the average U.S. carrier has doubled their costs in the last three years from 10 cents a message to 20 cents.

The cost is effectively zero as the bandwidth used to transmit messages is so minuscule that that even the 2.5 trillion sent in the U.S. last year had little impact overall on their infrastructure.

A major part of the reason is that the message is carried on what is called a control channel – space or spectrum reserved for the operation of the network itself for connecting a tower to a specific mobile device. The reason SMS messages cannot be more than 160 characters is so that they can fit within this channel.

The control channel sends 160 characters each time a connection is made – even if there is no SMS message attached for the free ride.

It’s like charging your wife for gas to drive her home from the office – even though you were already heading home regardless if she needed a ride or not. Then charge her double the following day. See how long that relationship lasts…

Cross your fingers that new carriers like Globalive will do more than just say all the right things during their courtship of your mobile service contract when they go live in 2009.

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