AT&T, Verizon Wireless: No SMS price fixing going on here

Reps from two of America's biggest wireless carriers testified Tuesday that no, there's nothing fishy about the fact that all four major U.S. cell operators are charging 20 cents per text message.

As CNET News.com reports, officials for both AT&T and Verizon trekked to Capitol Hill yesterday to answer charges of price fixing, given that the big four U.S. carriers have all doubled the price for individual text messages since 2005. 

For his part, AT&T general counsel Wayne Watts testified that there's "no evidence to support an accusation that anyone at AT&T engaged in any inappropriate, much less illegal, behavior," according to CNET.

Meanwhile, Verizon attorney Randall Milch claimed that the wireless market has seen "fierce competition, not collusion, in text messaging and wireless generally" (again, this from the CNET story).

Tuesday's testimony comes nine months after Senator Herb Kohl, chairman of the Senate's antitrust panel, penned a letter to AT&T, Sprint, T-Mobile, and Verizon Wireless, asking why they'd all raised their SMS messaging rates—which were about 10 cents a message back in 2005—to 20 cents a text.

As CNET notes, angry subscribers piled on after Kohl sent his letter, filing a total of 37 class-action lawsuits alleging SMS price fixing.

The carriers argue that text messaging rates for the average chatter have fallen drastically over the past few years thanks to bundled messaging plans. Indeed, on Tuesday, Verizon's counsel testified that most subscribers "pay less than a penny per message" thanks to SMS bundles, according to CNET.

But (if I could play the role of Jack McCoy for a minute here): The reason most users go with bundled text messaging plans is that individual SMS rates are so expensive, isn't that right?

Objection—irrelevant! Sustained. The issue here isn't whether individual SMS texting rates are outrageously priced, but if the big four carriers are conspiring to fix prices—an accusation that's devilishly difficult to prove (and frankly, given how cutthroat the wireless business is, I have a hard time believing it myself).

In any case, Sen. Kohl's wireless antitrust hearings are slated to continue. So as the judge in any given "Law & Order" episode might say ... let's see where this leads.

So, what do you think: Annoyed by the fact that individual SMS messages are 20 cents a pop? Think the big four carriers are plotting to fix prices? And would you ditch your SMS bundle if à la carte texts were cheaper?

Related:
AT&T and Verizon deny price-fixing accusations [CNET News.com]