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September 11, 2008

What's a text message worth?

Posted: 07:54 AM ET

Business Correspondent Jennifer Westhoven

Cellphone companies are sharply raising the price of sending text-messages.

ALT TEXT

Senator Herb Kohl wants to know why some cell phone companies have doubled the price of text messages.

Well, not so fast, says one senator.

Herb Kohl of Wisconsin wants Verizon Wireless, AT&T, Sprint and T-Mobile "to justify" the higher fees. Companies have raised rates from about 10 cents to 20 cents per message in the last few years.

And, text messages files are quite small and don't use nearly as much space on the network as a phone call!

Do you the price-hike is fair, if it's not costing the networks any more? Do you think the government should interfere with the industry?

Email us at CNN.com/robin with your opinion, or leave a comment below.

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Joe   September 11th, 2008 8:04 am ET

Coming from someone who worked for ATT for over four years the answer is simple. the cost of text messaging or any pay per use data is being raised to increase profits. This is done in hopes that if the pay per use rates are increased, that customers will opt to add a package that they must pay for monthly. Increasing the cusotmer's monthly service charges and ATT"s profits.


rick rosas   September 11th, 2008 8:38 am ET

first of all thank you robin for asking me, i stil don't know why there is always such a rise in the gas price at the pump, you know realy i always hear about new services for phones (its early so i wont go into them) but i see the different ways phone companys are converging and the services-ie procucts and faster ways of dealing with problems. man forget making them explain why texting is so expensive make exxon tell me why gas prices pass me on the freeway all the time
thank you
joe


Henry   September 11th, 2008 10:14 am ET

I don't use text. I rather call a person instead. Besides text is just another "hidden" fee that phone companies use to get more money out of the public, like the fees airlines are now charging. Also like the fees cable and satellite providers have because they are going digital. Those providers were informed about going to digital in 1985. They waited, so that they could charge more for the service. Why don't these providers have one set rate for all the features offered and not break them into seperate tiers for different fees?


Raaz Pathan   September 11th, 2008 7:13 pm ET

Im only 14 and i avoid using text messaging because it charges a lot and plus its a waste of time instead of talking on the phone. I only text when i need to.

Texting has caused so many accidents in cars that parents should start taking away cell phones from normal teenagers or give them cell phones without an unlimited texting plan.Also, to let the parents save money, they should make the teenager pay the extra bill.


Keith   September 12th, 2008 5:39 am ET

The price of everything else is going up! Why stop at cellphones?


Priscilla   September 12th, 2008 9:07 am ET

I really don't think government should interfere with the price of text messing as of yet, of course it's all about supply and demand, text messaging is used way more than an actual phone call so in a sense companies are losing money offering these services at such a low price, I text message all the time, and I think phone companies give consumers a break with offering unlimited texting for a low monthly price, however if they start to take unfair advantage of their consumers it would be appropriate for the government to take action.


DC3   September 12th, 2008 9:11 am ET

all of these cell phone companies are just as corrupt as oil and insurance companies. you have to love when they are willing to do ANYTHING for new customers but when it comes to existing customers they are treated horribly. for instance, they will give new customers a $400 phone for FREE but will make existing customers pay full price for an upgrade when they have been paying their bill on time for years! they'll do anything to get new customers but will do absolutely nothing to keep them happy once they sign up.


JudyM in TN   September 14th, 2008 6:57 pm ET

I dont think that the text messaging fees are that bad. I do not pay per txt ... we have 3 lines and only for $30 all of us have unlimited texting. I am in management so I attend alot of meetings/conferences or am not able to talk on phone and this is a great service for all of us.


Donna D'Angelo   September 15th, 2008 6:23 am ET

Actually I just changed carriers with a plan for unlimited texting...which I love..but now hearing from you about the rate hikes doesn't sit well with me. I did get this new plan because the PRICE WAS RIGHT. These companies get you to sign up for a 2 year contract then before you know it you are paying more money. Big businesses make the profit then we have to figure out how we fit this into our monthly budget!


common sense   September 16th, 2008 7:37 am ET

Its no about what text messages cost. Its about the cell companies using the price to force people into higher monthly rates. All of their prices are designed to get you to sign up for higher minutes, more messages or "unlimted" services which aren't really unlimited.


JC   September 18th, 2008 7:29 am ET

With the cost of the average Cell phone bill being $50 – $60 a month*, Carriers shouldbegin to consider bundling text, picture, video, and other data options into these standardized costs.

It's bad enough that we have to assume that a bill of $60 will cost us roughly $20 after taxes and "surcharges", but for these massive conglomerates to begin limiting or overchargin for data, is rediculous.

I believe HLN ran a stiory a few weeks back related to this, if not then I saw through the AP, but it was about internet providers limiting the amount of bandwidth a customer can use that they have paid for through their in home service.

We need a stiff competitor to these lofty cell phone contracts, and these bundles from the pseudo-monopolies, a provider that won't raise the price for txt msg's following trends, a provider that truly understands the real world value of these services.

Out of curiosity, is a telegram creaper or more expensive than a text message? If the trends in cell phone data plans remain the same I'm soooo going to refine my morse-based tapping skills.

* http://www.kiplinger.com/columns/starting/archive/2007/st0404.htm


Everett Stephens   September 19th, 2008 10:45 am ET

Just curious about the payback on the big bail out. Joe and Jill Q. Citizen have been required to invest billions of dollars into bailing out the financial sector.

We have been forced to invest in the very institutions who are responsible for managing the investments of both citizens and institutions alike. From a business opportunity perspective, the taxpayer now bares 100% of the risk of the investment. This presents the obvious business question, what is the proposed reward? If we are to participate in 100% of the risk in these transactions, then we should be entitled to share in the rewards. This is how business succeeds. Reward isn't in the form of preventing financial meltdown - that's simply managing risks.

Don't you agree that the taxpayer should be issued stocks, bonds, or offered interest payments as an incentive for assuming the risks? And shouldn't this be fairly proportioned based on individual tax contributions? From the business mind, the person's who pay higher taxes, are taking the greatest risks in the bail out.

If you are going to stir the dangerous mix of government and free-enterprise, then you need to balance the decisions with known business principles.


Fotios   September 22nd, 2008 8:22 am ET

This is yet another example of the cell phone companies treading all over their customers with no regard for decent business practices.

Is there any reason text messaging should cost more than 4x the cost of communicating with the Hubble telescope?*

* http://thelede.blogs.nytimes.com/2008/05/12/costs-of-text-messaging-vs-space-transmissions/?hp


Staci   September 22nd, 2008 9:37 am ET

It is a shame that companies are putting up signs telling customers that they will not receive service if they are talking on a cell phone. I have seen these at NC state employee credit union, City of Gastonia Utitlites office and a Methodist friend told me there is one at the ABC store . I waited well over 5 minutes for a cashier to finish a personal conversation on a land line (deemed personal since it ended with I love you), and at least 3 times she gave me the just a minute finger. When she finally ended the conversation , I held up the just a minute finger and said that I was listening to the voices in my head and I no longer felt a need for the impulse purchases , I did not get I love you.


Barb   September 26th, 2008 6:15 am ET

It's about time the people we vote to represent us start protecting us from these predatory tactics that businesses are using to make huge profits. It's ridiculus.I don't care if it's text messaging or $700 billion dollar bailouts. Right about now we the people need a bailout from this failing economy my pay is not keeping up with inflation!


fredric   January 9th, 2009 1:42 pm ET

I wonder if, in light of the economic downturn, cell phone companies might reconsider their stance on this issue moving forward. Raising rates concurrently with higher unemployment/under-employment or salary cuts would likely not be viewed favorably by the general public.


mno   June 16th, 2009 11:47 am ET

Be careful what you wish for. Instead of handing Kohl, etc., more power, it would likely be wiser to give Congress a long sabbatical – before they start telling us how to put our pants on in the morning.



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