Cellphone bill on the rise? Check your SMS charges

If you've been paying attention to mobile carriers' SMS pricing lately (and something tells us you haven't) you'd be surprised to discover a fairly disturbing trend amongst providers: price hikes. Over the past year or so, nearly every major carrier in the US has raised their per-price cost of SMS messages, with Verizon and Sprint jacking up the fee from $0.15 to $0.20 a message, and AT&T and T-Mobile adding another nickel to their $0.10 charge. Of course, this trend of rising prices accompanies a major spike in the use of text messages amongst customers, with some surveys marking a 130-percent jump over SMS use since June 2006 -- and telcos are taking it to the bank. What's most insidious about the inflated costs is the fact that SMS data is particularly low-bandwidth, and analysts say that the price increases aren't related to higher operating costs -- these companies are simply gouging customers for a service which they have embraced. Companies say the hikes are meant to encourage customers to go for more expensive "bundles," though we're confident they won't mention it when your Mom uses more messages than her plan allows and unwittingly pays a few extra bucks on her bill -- that stuff adds up, you know?

[cdog @ Jan 23rd 2008 10:42AM]

Bah... try Canada... where we routinely bend over. My favorite in the last year (or so) was when the industry quietly raised the price of DOMESTIC long distance from .25c/min to .35c/min in the face of unlimited/free long distance elsewhere. It's a monopoly here - no competition, nothing is reasonable... everything is ridiculous. Bell recently added an unlimited browsing plan for $7/month on the Touch, which is the FIRST reasonable move I think I have seen... in a long time.

Data is ridiculous... long distance, ditto... and airtime, well... getting better? As near as I can tell, US users have a lot less to complain about ;)

Oh yeah... we can buy an add-on plan for $12 that gives us 100 long distance minutes I think (though if you ask nicely... or more appropriately, threaten to head elsewhere, they will throw it in... whoop whoop)

[Vidikron (FU) @ Jan 23rd 2008 10:25AM]

Cell phones in general are a complete rip off... which is why I don't have one.

[LongshotX @ Jan 23rd 2008 10:48AM]

Something needs to be done to let these companies no that people are fed up with this gouging but the telecoms just keep doing it, and people keep getting complacent and just saying "oh, okay they are raising it again by 5 cents...no biggie". Now its become so bad the telecoms have conditioned a lot of people to accept what they do. Something needs to change. Anyhow, I think with AT&T you can get unlimited text M2M messages for like 14.95 and that includes 200 messages to outsiders. Don't quote me on that but its not that bad. Go unlimited unless you want to get raped in overages.

[LongshotX @ Jan 23rd 2008 10:50AM]

And as someone said earlier you're really not getting any bang for your buck on text messages as you are paying to receive messages. That is terrible.

[OneLove @ Jan 23rd 2008 10:57AM]

for months my sprint service has been sending me duplicate sms messages.

[OneLove @ Jan 23rd 2008 10:56AM]

I still don't understand why you have to take a hit for receiving a sms message or why when you have unlimited data you still have to pay for sending sms messages?

[midiwall @ Jan 23rd 2008 1:42PM]

It's simply a matter of "'cause the carrier can get away with it".

SMS runs on a different network than your calls, and most carriers will cry "but we have to pay fees to the sub-carrier for each message!" (in or out) and thus they're passing along that charge to you.

It's a real scam.. The carriers are simply cashing in on the SMS craze.

A poster down below mentions sending an email to the phone instead to get around the SMS surcharge. It's a good idea, but most folks will be deterred by how the phone handles email - it's rarely as optimized/pretty as SMS.

[Jay @ Jan 23rd 2008 11:01AM]

Its times like this I thank god I go to college in a town where Verizon is the only carrier that actually gets service.

As a result, 90% of the people I text on a regular basis have it and I get by with my unlimited in network + 500 plan

[wrxpert @ Jan 23rd 2008 11:33AM]

I have had my text turned off on my phone for about 6 months now. I could not be happier about it either. It is way too expensive for what it is. I recomend and encourage you all to do the same.

[Raghu @ Jan 23rd 2008 11:42AM]

This happens to be one of pet-peeves. Especially since SMS is practically free for the carriers. Here is a little history and tech explaination...

SMS on landlines (yes, in Germany) and GSM is sent using SS7. SS7 does not take any additional bandwidth because it is a part of the system. SS7 is used to initiate rings, calling waiting signals, the dial tone, etc. So essentially there is no added strain to the system from sending text messages.

When I started using SMS in the mid-90s in Asia it was being just given away. As it became more popular carriers started charging more and more. Even in the last year or so there have been increases... http://www.engadgetmobile.com/2006/10/09/sprints-sms-price-hike-saga/ and http://www.mobiletracker.net/archives/2007/01/12/verizon-wireless-sms-price.

When I switched to T-Mobile in 2004 SMS to foreign countries was charged the same as local. Today it is 50c per message abroad, and it is similar with AT&T.

How do you explain the increase of price of a service that costs the carrier virtually nothing, from next to nothing to keep increasing.

Also see http://en.wikipedia.org/wiki/Short_message_service

[T-Bone @ Jan 23rd 2008 1:44PM]

No added strain huh? Were you hiding under a rock on New Year's Day when messages were taking hours to be transmitted?

[Raghu @ Jan 23rd 2008 1:52PM]

Nope I wasn't... the reason is because the overall systems were overloaded. For the same reason that I explained, if you can't get on the system to even initiate a call (system busy errors) there is no way you can send a text. Interestingly though EDGE uses a different pathway it needs to be GSM authenticated which makes that also not usable.

I could not send texts or make any calls for the first 10 minutes after midnight.

The other thing you might have seen is that inter-carrier traffic today is IP. Those servers might have been overloaded too if you were getting return messages.

[T-Bone @ Jan 23rd 2008 8:14PM]

What you seem to be saying is SMS competes with voice. If everyone is texting, no one can get a call through. If everyone is talking, no one can get a text through. Ever think that could be why it costs so much?

[Raghu @ Jan 23rd 2008 10:57PM]

It doesn't compete, because it uses an out-of-band signaling on a separate channel. But the two band are tied such that they both have to exist for the phone to work. This wikipedia article has really good information on the SS7

http://en.wikipedia.org/wiki/Signaling_System_7

It also mentions the move to SIP protocols (today used in VOIP applications). The also talk about the "short message gateway" which is also used for inter-carrier messaging as I mentioned previously.

Even though the signal is available, it is the backbone that would have failed you on New Years. That is why you would have had "bars" one your phone, but nothing got through.

To directly answer your question... they co-exist without competing... thus you can get an SMS while you are on the phone. And thus my peeve-- SS7 must exist, is underutilized, carries our SMS, and thus SMS is practically free for providers to give us.

[Magallanes @ Jan 23rd 2008 11:49AM]

It's a sue time!.

[Neebs @ Jan 23rd 2008 12:01PM]

I pay $.05 a text on my Virgin pre-paid crap-phone. Sure, I can't always rely on the carrier to make an urgent message regarding breakfast at Chik-Fil-A to make it through but it's cheap.

[Cellenin @ Jan 23rd 2008 12:15PM]

If you have a data package why not a send a email to the persons number. e.g [e-mail]. That's how it's done in japan folks. Saves a shit load of money.

[Martin @ Jan 23rd 2008 12:25PM]

No, my cellphone bill rise is simply due to the city of Chicago raising their taxes. I have unlimited text messaging with Sprint.

[midiwall @ Jan 23rd 2008 1:38PM]

"Unlimited" on Sprint? I've asked about that and keep getting told "not available". What do you pay per month for that?

[Martin @ Jan 23rd 2008 2:10PM]

MidiWall,

My bill says I have "Unlimited 2-Way Text Messages" and I pay $10/month. I also have the "Power Vision Ultimate Pack" which is $25/month. But now I see the "Power Vision Pro Pack" that is $30/month and offers unlimited text messaging. The difference between the two is that Ultimate offers Sprint TV, Sprint Music and NFL Mobile.


There is an option to select "Unlimited Power Pack Text Messaging" for $10/month on the Sprint site too.

[midiwall @ Jan 23rd 2008 1:36PM]

I got nailed by Sprint last month. I'm on their largest message plan (1000 texts/month) and STILL got nailed for an _EXTRA_ $100 (500 messages @ $0.20 per). I can't believe I texted that much... Had a lot goin' on though, but that's like 4x my norm.

[Michael @ Jan 23rd 2008 2:34PM]

@ midiwall:

You may want to check out the plans Sprint is rolling out before Valentine's Day; they have an unlimited texting plan for $10/month if you also get a Vision data plan.

[midiwall @ Jan 23rd 2008 2:50PM]

@michael: You may want to check out the plans Sprint is rolling out before Valentine's Day; they have an unlimited texting plan for $10/month if you also get a Vision data plan.

Oh KILLER! I did the unlimited data plan with my Centro.

Thanks Michael!

[Baz @ Jan 23rd 2008 2:28PM]

What sens does it make that I pay for UNLIMITED DATA (iPhone plan $20 for data and 200 text) and if i go over on texts i get charged. Text mesages are only data after all.

[Michael @ Jan 23rd 2008 2:27PM]

I've had Sprint for the past 7 years or so. Used to have a bundle that was $5 a month and included 100 text messages and unlimited picture and text messaging (using 1xRTT [Vision] for data of course). Now that EVDO (Power Vision) is around, when I upgraded my phone I could still get text messaging for $5 a month. Unfortunately it included no data (that's an extra $20 a month), but it did get bumped up to 300 texts a month, which I've only exceeded once in the past 18 months.


So I guess what I mean is that for $5, I get what I need for texting. at $0.20 a message, that'd work out to $60. Realistically, I normally only use about 150 texts a month, but that's still saving me $25 a month by having the package deal instead of paying per-message.

[umm....hello??? @ Jan 23rd 2008 3:38PM]

...and the rates they charge for phone calls isn't outrageous? It's hard to find a plan that you don't pay at least $50/month, even if it's pay-as-you-go.

US Cellular is $.20/msg, or $4.95 for 250 msgs....but since I rarely text, I get 24 text msgs to use per month before I'd have to pay for a huge amount of text msgs I wouldn't really use anyways. and all my incoming texts are free---THAT's also where some telco's nail you--double check and make sure your INCOMING text msgs are also free.

[Josh @ Jan 23rd 2008 6:56PM]

freaking .20$ text messages on sprint when i go over my limit...

[kg1 @ Jan 24th 2008 1:06PM]

Well I have Virgin Prepaid and I use their 20 buck unlimited text plan, which to me isn't really expensive. The call rates are though, something like $0.18/min for the plan I have, though I do get a little over an hr a month in free mins through a loyalty programme they have.

I had T-Mobile for a couple yrs and I found I was mostly just texting so I switched to Virgin. I do miss T-Mobile sometimes though.

[Beantown77 @ Jan 25th 2008 11:25AM]

Most individuals understand cell phones can be, or are, in general, expensive. So what can be done to help consumers?? I mean seriously, when my bill arrives in electronic format from my carrier, I typically just paid it without allot of due diligence. I read a piece in Wireless Week about Validas, and life has been so much better ever since. Validas will 'audit' your bill in seconds, and it only cost about a buck!! Free if they do not find any errors.

http://www.wirelessweek.com/article.aspx?id=154798

Saved $231 so far on my cell bill.

[Joshua Walters @ Jan 26th 2008 4:21PM]

I made sure I was immune to this. Well, sorta.

I got an unlimited plan so I wouldnt have to worry about going over and the continuing price hikes on messages.

They cant touch the price of my bill for a year or so.

[tcofer1488 @ Jan 30th 2008 4:06PM]

I had the same problem on Verizon regarding TEXT MESSAGES. However, I have to explicitly call customer service and tell them to DISABLE the text feature on my account.
FYI: At this point you will be UNABLE to receive ANY text msgs – not even the FREE ones from VERIZON! :)

[tcofer1488 @ Jan 30th 2008 2:41PM]

UPDATE to earlier post:-) this is obviously for folks who don't choose to use the
TEXT FEATURE and are NOT looking to incur another BILL, should you
need to ENABLE the TEXT OPTION for what ever reason in the future,
VERIZON can ENABLE it to perform certain applications and return it
back to the disabled mode afterwards.

[tcofer1488 @ Feb 1st 2008 8:01PM]

"Class action nails T-Mobile USA over texting services"

Just a matter of time--folks are getting tired of the BS!!! It is one thing if one chooses to have the Text Messaging feature and another if they chose not...

The bigger the companies -- the bigger to rip offs!!!

http://tech.yahoo.com/blogs/null/66798;_ylt=Ai6fNmE3mMQSI53kw7TwdBcE1vAI

[lestat @ Mar 10th 2008 3:32AM]

Prices are in HKD
Local SMS - intra network $0.10/SMS
Local SMS - inter network $0.70/SMS

[John @ Jan 23rd 2008 8:40AM]

If people will pay it, why not?

[JustinM @ Jan 23rd 2008 8:43AM]

If this were the only ridiculous thing cell carriers did to make their customers (and don't forget that...we're the customers, not them) pay more, we might be able to overlook it. But it's certainly not. It all adds up to one big steaming pile of...

[lmondesir @ Jan 23rd 2008 8:51AM]

Is it just me, but ever notice on att you can't NOT receive a text msg. A friend has t-mobile and when a text comes in he can ignore it, can don't pay, whereas on att I have no choice, once the text is sent I get charged whether I read it or not.

[ntbsd @ Jan 23rd 2008 8:53AM]

@lmondesir,

Man, you have to pay to receive SMS?

[drakono @ Jan 23rd 2008 9:34AM]

@lmondesir

I have the same problem on Verizon. I have to explicitly tell all my friends NOT to send me text messages, because there's no way to decline them -- and then a few of them still do. At least it's a way to weed out the more simple-minded people so I can stop being "friends" with them. But they still have my number. :(

[Hax Or @ Jan 23rd 2008 9:49AM]

Everyone raise your prices! They will be forced to pay it!

Cuz there's no one else.... muhahaha

- The Management

[OneLove @ Jan 23rd 2008 11:01AM]

like when your fiends and family send you invitations to social networking sites and use your private email address. :|

[mylicon @ Jan 23rd 2008 11:38AM]

People seem to forget fundamental business concepts. First and foremost a commercial business' primary goal is to make money. They are not a utility or the Red Cross so they're under no obligation to give away a product at cost or some designated markup. People don't seem to have qualms about paying a few dollars for WATER because it comes in a bottle. Second there's a neat little concept in economics: "price the market will bear."

Most cell phone carriers (in the US) are more than happy to turn data off to a specific line completely. I have done this with both AT&T and Verizon without much fuss.

[Michael @ Jan 23rd 2008 12:16PM]

@imondesir

That's incorrect. T-mobile, as with all nation wide carriers, can not see whether you've read the text message or not. You are charged for receiving it, not reading it. Unless your carrier has unlimited text included in their plan (Cricket, for example).

---

I work for a cell phone carrier in their customer care department. Honestly, cell phones can get really expensive if you don't watch your usage. This includes minutes used, sms, data, 411 calls, and downloads of games or ringtones. If you don't want to be charged for incoming SMS, you can call in and normally have it removed. If you like texting, you can opt for a plan that will give you a predetermined number for a far cheaper "per month" price. My carrier, Sprint, for example, let's you get 300 for 5.00, 1000 for 10.00, and unlimited for 15.00. Without the plan, 5.00 is only 25 text messages a month, 10.00 is only 50, and 15.00 is only 75 messages. So, you can see that at least having the lowest plan would save you quite a bit of money.

And, trust me, it does. I see cell phone bills with four hundred dollars worth of text messaging at least once a week.

[ntbsd @ Jan 23rd 2008 8:48AM]

If there's a way for them to rip you off, you can guarantee they are already doing it or have it planned.

Like here in the UK, Orange started charging to call 0800 numbers a while back.

[nh @ Jan 23rd 2008 9:25AM]

0800 numbers were never free from mobiles, were they?

It is a real shame to be increasing the costs of SMS like that. Seems to me they're just pissed 3G and all the expensive/complicated services didn't catch on.

[ntbsd @ Jan 23rd 2008 9:43AM]

They were free on Orange and O2 and then I know Orange started charging for them. They put a message on there at the start of the call announcing that the call was chargeable when they did it too. We're probably going back 5 years or so when they didn't charge though.
I know the Orange PAYG service didn't charge for 0800 numbers at one point, even though contract users did.

Either way, Orange find a way of screwing me out of more money each month.

It's quite sad really that whenever you try another provider, you normally end up going back to the original, purely cus they screw you over as much as the provider you came from, if not more.

[w00t @ Jan 23rd 2008 10:15AM]

They started doing this because people (myself included) bought a cheap PAYG sim card and a good freephone calling card and then essentially paid landline rates for mobile calls, which back then were very expensive!

This I can understand, as orange is still paying for part of that call but the profit is going to someone else.

What did annoy me is the recent sneaky renaming of Local Rate (0845) to Lo-Call Rate so they can get away with charging you more than local rate!
A couple of months ago o2 announced like other providers they will no longer count towards your minutes but run up your bill... :/

[Red Nicholson @ Jan 23rd 2008 8:50AM]

I post this from little old New Zealand (Flight of the Conchords, anyone?) with a smile on my face, which is quite a rarity given our ludicrous mobile pricing.

Here in NZ we can send up to 2000 on-net (or 500 to any network) SMS for $10/month, which is about US$7. However, this is balanced by our stupid calling rates ($1.39/minute!!)

And as a result, we have an entire nation of teenagers growing up addicted to "txting", and hu nw typ lyk dis al da tym, evn in englsh esayz. So in some ways, be thankful that your carriers are charging more, it may be saving you from future generations of illiterate kids...

[Peter @ Jan 23rd 2008 9:29AM]

Too late for that.

[MARSHAK @ Jan 23rd 2008 12:39PM]

@red

this isn't new to us over here in north america. I'm a canadian college student and we get lectures from our profs who are quite angry everytime they see this kind of writing. In a sad way it could (some may argue it is) an academic epidemic.