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Comment by axod | Hacker News Reader

In what way is it a price fixing scam??? In the same way your electricity supply is a price fixing scam?

Please don't believe the idiotic articles claiming that sending an SMS costs the mobile companies nothing...

If all the phone carriers get together and say, "Hey Bob -- if you keep the price of your SMS at 10c, I promise to keep the price of SMS at 10c. We agree to not compete on SMS pricing. That way we can make lots of moola on something that costs both of us nothing."

that's why they raised it from 10 to 20 cents over the last few years

That's collusion and it's illegal. They just watch each other. If verizon doesn't move, Sprint doesn't either. That's also the way airlines match prices.

The base station (edge) and network-infrastructure (backhaul) equipment probably can't be purchased without SMS functionality at this point. There's no delivery commitment on SMS/MMS messages and traffic at essentially every site is cyclical. SMS gets delivered in the idle space, therefore the marginal bandwidth cost is literally zero.

That pretty much leaves the SMSC/MMSC (the dedicated hardware that processes messages in the center/edge of the mobile network). Perhaps $0.10/message was justified in 2000 when this stuff was only being used by phone geeks, but I think there's a bit of margin in it these days. :)

Some plans charge 1000 times as much per byte for text as for voice. I would say the difference between zero and non-zero is just noise.

SMS costs the carriers virtually nothing. Not exactly $0 but very close, something like $0.000000000000001.

They do not contribute to variable costs. But in theory the money made from SMS could be used to cross-subsidize calls.

Well, I guess that the fact that sending data through SMS costs four times more per byte than downloading data from the Hubble telescope sort of tells people that they're being screwed.

http://www.theinquirer.net/inquirer/news/303/1046303/sms-cos...

And sure - it costs the operator more than zero to send an SMS, but it's so close to zero that it's hard to tell the numbers apart.

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