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Cost of SMS Text Messaging

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Tagged As: Business and Technology

SMS, or text messages, are typically viewed as the digital playground of teenagers keeping in touch via their cryptic "OMG WHERE RU" lingo. But growing at a 32% transmission rate, more than 3.3 trillion text messages are expected to be sent in 2009. That's pretty lucrative for the wireless carriers that have recently doubled their per message average rate. They're making so much money on SMS that Europe is pushing to cap rates and fees on these wireless services. What is really interesting about the SMS phenomena is how it essentially costs nothing to implement. SMS works by piggybacking a 160 character message in the always active control channel used by the mobile network. Whether the wireless carriers offered SMS or not, the control channel would be ubiquitously present anyway in order to maintain phone registration by tower, signal incoming calls and voicemail, transmit time, etc. SMS simply appends a text string within one of the regular control packets and the carriers bill you for it.

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