Text addicts will tell you a flat fee for all of the text you can twitter is more than worth the price. But there’s a senator from Wisconsin who says you are overpaying for the priviledge.
Democratic Senator Herb Kohl is looking into why a la carte text costs have doubled at a time when operator costs have remained flat. In fact, the technology costs the operators nothing at all in terms of bandwidth.
Last September Democratic Senator Herb Kohl from Wisconsin sent a letter to the top presidents of AT&T, Sprint, Verizon Wireless and T-Mobile asking them to explain why the price they charge customers continues to rise. As chairman of the Senate Antitrust Subcommittee, Kohl wants to know why prices have doubled during a period while competition, through operator consolidation, has decreased.
The text business is a booming business. SMSing is up 32 percent since 2007 totaling 2.5 trillion worldwide messages sent each year. The Gartner Groups says that number will jump to 3.3 trillion in 2009.
Consumer advocates — who have filed more than 20 class action suits against the carriers — are incensed because sending a 160-character text costs the carriers no additional bandwidth to transmit. That’s because the message is carrier in a dedicated part of the communication called the control channel, reserved for setting up calls, ringing your phone, sending SMS texts and other overhead operations. Kohl’s case centers around why operators have doubled their fees while shrinking their operating expenses through consolidation for bandwidth they doesn’t cost them anything to use.
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