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Texting is Cheap

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The article, <a href="http://www.nytimes.com/2008/12/28/business/28digi.html" source="NY Times" author="Randall Stross">What Carriers Aren’t Eager to Tell You About Texting</a> digs into the pricing and cost structures for text messages (SMS's<fn>) sent via cell phone. It cites astounding numbers of messages sent per year and talks about 10-fold growth in messaging across the spectrum and around the world, but the upshot is: transmitting text messages costs next to nothing so long as an infrastructure for transmitting telephone calls is already in place. That is, the graph of cost to number of messages transmitted does not at all scale linearly, instead flattening drastically after a certain point---a point long since reached by all major carriers. This is possible because <iq>text messages are not just tiny; they are also free riders, tucked into what’s called a control channel, space reserved for operation of the wireless network.</iq> This is one reason why messages are so extremely limited in length and why picture messages are in another weight-class altogether. Naturally, the telecoms companies are loath to correct us in our collective assumption that their <iq>operational costs [rise] in tandem with message volume</iq>. With this belief that text messages are like a standard, physical commodity, they have been able to <iq>doubl[e] prices for text messages charged by the major American carriers from 2005 to 2008</iq>. Since transmitting messages essentially costs a telecoms company nothing, they are the happiest when you sign up for an unlimited plan for a fixed price per month ($15--20, depending on the carrier). Naturally, they are providing a service and they have the transmission capacity whereas we, as customers, would like to use it. That's capitalism, after all. But, with a captive market and a near-monopoly (only four carriers remaining in the States), they are then free to push prices up without relation to the cost of providing the service. One can convincingly argue that text-messaging is not a social need, like food or shelter, but why should such a useful service---running over a public spectrum leased by the American people to these companies---be subject to the fickle rule of free-market capitalism? Is this situation really benefitting anyone other than the telecoms investors? At what point does a service become "standard", like water and electricity, and subject to more regulation and less price-gouging?<fn> At $360 per year just for text messages---and, considering alternatives like chat and email are free---the price is already fairly steep. <hr> <ft>U.S.-standard punctuation rules are in effect in this article, as with all articles at earthli News. Punctuation afficionados on this side of the pond should simply pretend that that apostrophe is not there.</ft> <ft>Text-messaging is still fairly new, so, in my opinion, it's not yet at this point, but the questions are still interesting and valid (again, in my opinion). Rabid free-marketers---if there are any left after the end of last year---will disagree.</ft>