Text Messaging = Massive Rip-Off

You know it and I know it, but for some reason, we continue to shell out 15 cents a pop (or even 20 cents, starting in March for AT&T customers) for a pathetic, 160-character text message. One annoyed blogger went out and did the math, and the numbers are pretty staggering.

Over at "a gthing science project" (by way of Slashdot), blogger Sam Garfield fired up his calculator and juggled some figures:

If you divide 140 (the total number of bytes available to you) by 20 (the cost per message), you find that you are paying one cent for every seven bytes of data. This leaves you with a cost of $1,497.97 for the 1024Kbytes contained in a single megabyte. iPod users: It would cost you $5,991.88 to transfer—not even to buy—a single [4MB] song via SMS.

Of course, text-messaging prices aren't nearly as exorbinant if you buy a bundle of messages from your carrier (for example, AT&T has a $15/month plan for 1,500 SMS messages, which comes out to a cent a message). That said, do the division and you'll find that an MP3's worth of data would still cost roughly $300 sent via text message. And what's the cost for carriers? It's hard to say for sure, but in an era of $40/month plans for high-speed EV-DO and HSDPA data access over cell networks, I'm betting the actual cost for a 160-character text message is, well, pretty cheap.

OK then, so why do the carriers charge so much for sending (and in some cases, receiving) text messages? Short answer: Because they can. Whether you're a pre-paid cell chatter or you're under a two-year contract, you have to buy text messaging through your carrier, and they'll all charge you a premium for a la carte SMS. (Check out Dory Devlin's handy text-messaging shopping guide for more details). Considering that we send about 28.8 billion SMS messages each month in the U.S. (according to wireless industry group CTIA), there's a lot of money to be made, and when it comes to texting, we're a captive audience.

So if text messaging is a massive—how shall we say this—profit center for the carriers (kind of like $8 Cokes at the movies), what can we consumers do about it? Unfortunately, short of boycotting SMS altogether, not much. My suggestion? Consider your texting habits carefully before you pony up for a $15/month SMS bundle. If you're only sending, say, one text message a week, consider ditching an SMS plan altogether (but bear in mind that your carrier may charge you 5 cents or more for each SMS you receive...yeah, I know). Otherwise, estimate how many text messages you send a day, multiply it out for a month, and choose your plan accordingly.

Related:
The True Cost of SMS Messages [a gthing science project]