Food for Thought: The Relative Cost of SMS (And Why It's Vomit Inducing)

While many carriers offer unlimited SMS text plans, much of the world uses phone plans which charge per SMS text message sent.

An SMS text message can contain at most 160 characters, or 160 bytes of data.

At $0.05c USD per SMS, that’s at least $0.0003125 per byte
$0.32 per kilobyte
$327.68 per megabyte
$335,544.32 per gigabyte

At least $335,544.32 per gigabyte

A typical 2 gigabyte per month data plan is $25. An unlimited, infinity gigabyte, data plan at most $30 / month in Taiwan.

At $0.05 / SMS, $30 is 600 SMS.
$25 for 2GB is the same as 13.4 million SMS.

At these rates, it’s almost no wonder that phone credits are often used as a currency in many developing countries!

If this isn’t information arbitrage to the grossest degree, or an orders of magnitude “ghetto tax” then what is it?

Now, consider:
A circle of friends with smartphones and unlimited data plans can send unlimited IM messages, pictures, even video to each other for zero marginal cost. Sometimes unlimited data plans include unlimited text, but not always.

In the later case, receiving an SMS from a friend and knowing that the only way that friend can get a reply is via SMS is a burden. What’s a friend to do? Of course you’re going to reply, but at a rate of $335,544.32 per gigabyte.

The best we can do for now is: “Friends don’t let friends use SMS.”

If I get an SMS from a friend whom I know has a smartphone, I fire up IMO.im app and reply to them using GTalk, Skype, Facebook IM, or if I can’t find them there, I find them on What’s App or Kik and reply that way. This conditions them to stop sending me SMS. If I find they aren’t on any of those, I reply to the SMS with SMS and include: “Hey, get What’s App or get on IM”. For everyone else, I happily reply with SMS, but will note to softly suggest the benefits of getting out of the 90s and getting some sort of Internet enabled phone when I see them.

One more thing:
“Nielsen found that teens send or receive an average of 3,339 texts per month. Those between the ages of 13 and 17 send or receive an average of 4,050 texts per month, far more than any other age group. The next closest group was 18-24 year olds, who send an average of 1,630 text messages per month. Those figures are both greater than the average amount of texts sent during the same quarter in 2009.”

[quote=“mabagal”]While many carriers offer unlimited SMS text plans, much of the world uses phone plans which charge per SMS text message sent.

An SMS text message can contain at most 160 characters, or 160 bytes of data.

At $0.05c USD per SMS, that’s at least $0.0003125 per byte[/quote]

Correct me if I’m wrong, but aren’t SMS sent in octets (7-bit,8-bit, and 16-bit encoding schemes)?

Fuck I’m so far out of my element on this but I remember having this conversation with a telecom guy.

If so, that would be 160 bytes X 8 (8:1 bytes to octet ratio) = 1280 bytes per SMS

At $0.05 USD per … more like $0.0025 per byte

And then the math goes off the rails.

No idea if you’re correct, but it seems to me mabagal’s calculation is better as an amusing yet revealing reference, as the same message would have to be sent in bytes and not octets over the net. In real terms, only the .05 per SMS is important, what it adds up to, how much it would cost you in internet fees to send the same messages, and how efficient the resulting communications would be compared to SMS communication.

I find SMS a horrible waste of time. :astonished:

It’s so much faster to send an email or give a quick shout over the phone.

SMS is cheap in Taiwan, when I left the UK the average price was 12 pence per SMS…
That said, I’m using an alternative service now called kik messenger on my Android phone which means I can send as many and as long messages as I want, BUT of course only to other users of the same app…

[quote=“super_lucky”][quote=“mabagal”]While many carriers offer unlimited SMS text plans, much of the world uses phone plans which charge per SMS text message sent.

An SMS text message can contain at most 160 characters, or 160 bytes of data.

At $0.05c USD per SMS, that’s at least $0.0003125 per byte[/quote]

Correct me if I’m wrong, but aren’t SMS sent in octets (7-bit,8-bit, and 16-bit encoding schemes)?

Fuck I’m so far out of my element on this but I remember having this conversation with a telecom guy.

If so, that would be 160 bytes X 8 (8:1 bytes to octet ratio) = 1280 bytes per SMS

At $0.05 USD per … more like $0.0025 per byte

And then the math goes off the rails.[/quote]

To be honest, I don’t know. But it’s 160 bytes of data that the user created, protocol aside. I feel I can make that comparison since protocol overhead is zero to near zero marginal cost when using the Internet over an unlimited or high-limit data plan.

Dividing the cost comparison by eight doesn’t make it much more appealing… it’s already orders of magnitude difference. :slight_smile:

It’s interesting to me that even in digital channels we can still find a number of examples of delivery mechanisms that will inevitably disappear once the infrastructure and enabling technology is accessible enough to get the network effects required for ubiquity. It’s only been a bit over 10 years since digital PCS made cell phones affordable; in the next 10 years we’re going to see ubiquity of smartphones and data plans and the demise of SMS, as with CDs before and now with physical books.

The only drawback is having to deal with non-ubiquity of any single messaging “app” in that new world:

You use all of those!?

I actually replaced the bottom two with imo.im, but the rest are in active use because different clusters of friends latched on to different apps.

My phone bill is around NT$1,000 per month, which seems pretty damn reasonable to me.

Sadnman, do you call people directly or do you go via skype? Calls via skype are apparently cheaper!!

I personally can’t be bothered figuring it all out. As you say, the cost of all calls and SMS is not a lot anyway. Buggering about with different apps for different friends just sounds like a headache.

[quote=“Loretta”]Sadnman, do you call people directly or do you go via skype? Calls via skype are apparently cheaper!!

I personally can’t be bothered figuring it all out. As you say, the cost of all calls and SMS is not a lot anyway. Buggering about with different apps for different friends just sounds like a headache.[/quote]
Wouldn’t you need a computer to do Skype? I think there’s Skype on the wife’s wee computer at home, but I’ve never used it. I need to figure out how, though, as my mum has just got her first computer and wants to do the webcam/Skype deal.
As you say, a bloody headache.

Actually, the interesting thing about it is this sort of happens organically and automagically. First, most of it just the chat systems we already use but done on mobile and with incoming notifications so it acts like SMS: GTalk, Skype, MSN, Facebook. On newer apps, you get a ping or invite from a friend who is using one of those apps. It has a link in it. The link gets the app.

From here, everything acts just like SMS. When then message comes in, you get a notice on the phone. You click on the notice and it opens the appropriate app. So you never really have to futz about with different apps, you just end up in them as friends start to cluster together. You bring up a good point however, in that SMS is the lowest common denominator and thus guaranteed to work. The premium comes from this ubiquity, but the premium is extremely steep if you look at it in terms of available alternatives.

Actually, nowadays you don’t. You can download the Skype app onto iPhones and most Asia-spec Androids. Skype works over 3G and fairly well. This means, you can do international calls from your phone for very cheap to free. A scenario where this came in handy recently is my girlfriend using Skype on an iPhone to join a conference call with her Stateside colleagues while we were taking a tour bus to an amusement park. She did this for free because of the unlimited data plan.

If I count the number of IM messages I send back and forth to people a month from my phone and if I were to send that same number of SMS at $0.05 USD each, my bill would be in the hundreds of US dollars, maybe 20-30K TWD. Having the data plan allows me to work in ways that would be very cost-ineffective if I were to only use SMS.