That recently came out?

This has been common knowledge for years. Not once was I under the impression that paying 10 cents to transfer ~200 bytes was anything but pure profit. Nor was anyone else that thought of it at all.

People are willing to pay for it, because it is a value added service. I pay $5/month for an allotment of texts. Yes, it costs Verizon only 2 cents or something to provide this service for me. Yes, I think it is a ripoff, but the majority of people just pay the money for the service, and are happy with the service.

Due to this, the carriers have no reason to discontinue this means of charging for something that has almost no cost. So, yes, we will be stuck paying for texts for quite a while.


Have you ever paid $30 for a printer cable? Have you ever paid $15 for a music CD? These are items that have a tiny cost of production. The printer cable can be purchased online for under $1. but people pay $30+ for them at Best Buy all the time, because they can't wait, or are completely uninformed.

But, you see, Best Buy only has a monopoly of sorts when it comes to ignorant consumers and people who need something NOW regardless of the price... the phone companies form a sort of oligopoly - as long as all of them desire to price things like this, and they will, because it is so profitable for them, then we can not expect to get texts for free. We will either have to pay 10/15 cents for them, or pay $5-10 for an unlimited texts plan so we don't pay for high usage.

In the future, there may be a carrier that just includes texts in the service, and if so, they will likely see a nice boost in subscribers due to this... but they will also likely see their profit margins fall quite a bit. In fact, I bet there are accounting types that work for the cell phone companies that have done an analysis of which would get them more profit (free texts), and have probably determined that as long as everyone else charges for texts, making them free or really cheap loses them more profit than it is worth.

Lastly - not everyone can communicate with data services. I can use AIM on my phone, but it's a ridiculous kludge. Once I get a decent phone, I might or might not use data based services to talk to people. Not to mention, I don't pay for extra data, and if the rates for texts seems high, the rates for data are D:.
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I can't speak for the community as a whole, but I most definitely am not willing to pay for SMS as an extra on top of my already expensive data plan. That's why I have an iPhone - instead of going over SMS at $0.10/text, my AOL chats go over the data service I'm paying $30/month for.

As for why some people accept the cost, the reason is simple - it's a relatively small cost on top of their existing cell plan, and it's useful to them, they don't have a choice (all providers charge monopoly rents on SMS services for some reason). And they can't turn it off because their peers expect it to work.

I suspect that what drives this is that some significant percentage of business cell phone users aren't paying their own way, and their companies have policies that allow SMS. And so they use it, because it's there. And then people who aren't in that situation are forced to adopt SMS because they have to interact with the people who get it, effectively, for free. And so they pay for it too. Most people aren't stubborn enough to just say no, I'm not going to accept SMS messages. And thus a dysfunctional market is born.
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Who said we are willing? We are getting ripped off!

And worse, even if we know the shortcuts, like using Gmail or AIM to send SMS for free, most of the people we SMS with just can't handle that level of complexity (it was hard enough to convince them to learn how to text!).
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Actually you have raised a very valid point the cost for SMS should be bundled together with the data plans, because e technically speaking at least in my estimation they both use the same channel for transmission. Actually the tech savvy community should be at the forefront of this debate. There are a couple of forums that are already addressing the issue with some seriousness. join the debate.
Source(s):
http://groups.google.com/group/grandcentral-help-getting-started/browse_thr... http://getsatisfaction.com/pownce/topics/whats_up_with_sms_integration_that...

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