AT&T’s New Text Plan Overcharges You by 10,000,000 Percent. Literally.

[ensho]

http://gizmodo.com/5832245/atts-new-text-plan-overcharges-you-by-10000000


AT&T's killing their $10/1,000 text plan. Now, you'll have to choose between $20 for unlimited, or forgo a plan and pay $0.20 per message. AT&T calls this "streamlining." We call it what it is: an outrageous, gigantic scam.

It's important to note, before considering anything SMS, that text messages are essentially free. Not for you, of course, but for companies like AT&T, Verizon, and Sprint. Unlike uploading a video to YouTube from your phone, which eats mobile bandwidth, text messages ride the same itsy bitsy communication channel your handset uses to check in with local towers to make sure it's turned on. Each text hitches a ride on an infinitesimally small data packet, chugging through traffic that would've been there anyway. For AT&T, it's basically a freebie—160 bytes of data. A trifle. Compared to the rest of what they're transmitting, AT&T's texts are like amoebas on the back of a tyrannosaurus.

For you, it's quite the opposite. For you, text messages cost money. A lot of money. How much money? Well that all depends. Starting next week, the only texting options for new AT&T subscribers will be a $20/month unlimited buffet, or paying per text, which is insane.

-snip-

AT&T offers a 2 gigabyte per month phone data plan for $25. By breaking this down, we can find out how much they think each text's worth of data costs. And according to this value, when you're using the same amount of data to send a text without a messaging plan, they're charging you 100,000 times more. Yes. Blink a few times and read that again. When AT&T calls data texting, it costs 100,000 times more than when it's in the form of photos, music, email, or anything else. They're ripping you off with the force of a nuclear bomb.

Here's how it breaks down:

-snip-
----------------------------

the last paragraph of the article has some interesting wordage.

[Dappleganger]

1. We have their unlimited family texting plan

for $35/month for five lines, and use it constantly. Hopefully that won't change.

[snooper2]

2. The author of this piece is absolutely clueless about SMS

Fuck, at least he could have read up the wiki page on it. It is pretty accurate on the subject. This part is really funny- "chugging through traffic that would've been there anyway." :rofl: :rofl: :rofl:


Maybe he can fork over the bucks next time a new gateway needs to be implemented :)



Tool...

[EOTE]

8. It's not entirely off base.

The bandwidth consumed by a typical txt is miniscule compared the bandwidth utilized by transferring photos, music and such. I'd imagine most telecoms dedicate many magnitudes of order more bandwidth for those other things as opposed for the few kilobytes required to send a text. It's not free, but it's essentially free.

[snooper2]

26. Except for the people who maintain the servers, and testing, and inter-op testing

and everything else that happens under the covers that the majority of the public is clueless about :)

Go to say Huawei and ask them how many hours of development time they have on just their HSSS blades....

[EOTE]

32. Believe me, I understand server load. I've been in IT since the day I turned 16.

What AT&T is paying for is bandwidth. The bandwidth associated with texting (even millions of users) is absolutely insignificant for AT&T's architecture. If they were to charge commensurate amount for transfers of music and such, you'd need to mortgage your house every time you downloaded an MP3.

[snooper2]

36. It's not just the bandwidth is what I'm trying to say..

Opex costs for maint. contracts on platforms, personnel to support the networks, space and power,

[EOTE]

37. All of that is the cost of bandwidth.

If servers didn't require any maintenance, IT folks would have far fewer jobs to fight for. That being said, the amount of bandwidth required to send a txt is INSANELY cheap. They're charging many magnitudes of order more for that bandwidth than they pay for it.

[Silent3]

11. Even if some details are incorrect...

...the point stands about it being ridiculous to charge so much for so little data which places so minor a demand on network capacity.

[jeff47]

20. Actually, he's right when it comes to communications between the phone and tower

Since this is AT&T we're talking GSM. SMS is an optional part of some GSM packets. Those packets are sent whenever the phone is on (need to handle changes in timing advance, switching towers, locating the phone on their network, etc).

Since GSM is time-sliced, shorter packets don't save any bandwidth. Shorter packets just mean more time when nothing is transmitted. So the transmission of an SMS between the phone and the tower is indeed free, since nothing would be transmitted during that window if there is no SMS.

AT&T still needs an SMSC and a bunch of other SS7 infrastructure to actually deliver the SMS to the recipient. But all that infrastructure is a one-time cost. A 'per-SMS' fee doesn't make sense as a way to pay for it, if their goal was to only pay for that infrastructure. But a 'per-SMS' fee is fantastic if your goal is to make an enormous profit.

[snooper2]

25. There is a whole backbone after that data gets to the tower...

IMS

[jeff47]

27. Yes, as mentioned in my post.

The part about an SMSC and a lot of SS7 infrastructure.

But most of that SS7 infrastructure is necessary just to do voice. We're not talking about a lot of hardware costs to add SMS to that system, and as one-time costs they'd be better funded by a $X/mo plan instead of a per-SMS charge.

But per-SMS makes a lot more profit. 'cause it doesn't cost anywhere close to a penny for AT&T to deliver that SMS, but they're charging 20 cents.

[Occulus]

39. Each message costs them about two thousandths of a cent.

NOT $.02, but 2/1000 of $.01.

Heard that on a tech podcast a couple days ago discussing this very story. And yes, before you ask- these people are known and respected analysts.

They were flabbergasted at how incredibly cheap SMS is for these companies and how badly customers are being hosed for the ability to send texts.

[onehandle]

3. The reason is the iPhone's upcoming iMessage, a free messaging service.

It's for iOS devices and will reside transparently beside regular text messages.

Which is predicted to be the final stake in BlackBerry's heart, btw.

[Romulox]

4. Text messaging really doesn't make a ton of sense on any level, does it?

Not as complete as email, not as immediate as voice, texting is a technology that really doesn't answer any problem, imo.

[Not Me]

7. I have often felt the same way...

If we had text messaging for years, and then the phone companies unveiled voice service, we would rejoice at this great new technology.
And probably have to pay a big premium for it.

[Romulox]

9. Wow. Your hypothetical really puts things into perspective.

"If we had text messaging for years, and then the phone companies unveiled voice service, we would rejoice at this great new technology."

Super perceptive. Agree 100%.

[tabbycat31]

21. texting is more immediate than voice

When you get a voice mail, you have to dial to check your message. You see a text immediately. (Disclaimer-- my voicemail greeting actually tells people to text me instead of leaving a message).

[Romulox]

22. You do have a point. I think I have taken "visual voice mail" for granted.

I do remember the old days of scroll through VM in an audio menu. That does stink.

[tabbycat31]

29. Visual voice mail?

Tell me more--- I am intrigued by this idea.

[Romulox]

38. It looks like this on an Iphone:

Basically, just a visual list of your voice mail messages. Here's Apple's blurb about it:

See your voicemail.
Visual Voicemail on iPhone is still the biggest breakthrough in voicemail since, well, voicemail. It lets you view all the messages you’ve received and select the one you want to hear first — just like email. So instead of listening to messages in the order they were received, you can go directly to the messages that are most important to you. To return a call, tap the Call Back button.

http://www.apple.com/iphone/features/phone.html

[LibinMo]

31. Half of my family is in Dallas.

When the Chiefs or Cowboys are playing we text back and forth a lot, usually during commercials.

[recoveringrepublican]

23. As a deaf mother, Texting has helped my life in numerous ways!

However, now with an Iphone, i am not using text that much, as most just will email me now.

[truedelphi]

40. Isn't it popular among kids who grew up with it?

I mean, it does seem more awesome than passing a note around.

I think the older a person is, the less sense the gizmos make.

I don't even have a cell phone, as I lose the damn things. And being home 80% of the time, what would be the point?

[unblock]

5. personally, i don't get "texting".

i use it, though ONLY with mrs. unblock because she insists.

i don't see how it's worth paying extra to text as opposed to emailing.

yeah, ok, emailing is a couple extra taps. but seriously, people insist on paying an extra ten cents per text message just to save a tap or two?

[BadgerKid]

28. Texting can be more convenient/better purposed than email.

You could be driving and want to send a heads-up you're 30 minutes away -- you don't necessarily need to make someone answer a phone to tell them this. Oh, and the recipient has only a cell phone and no answering machine with speakerphone, so call screening is out of the question.

You might not be able to email since either your phone cannot send emails or you're not near a computer otherwise.

Anyway, like email, texting is meant to be asynchronous communication, but it tends to be used a little less asynchronously than email.

[unblock]

35. ok, well if you have a phone without an email/data plan, sure, i get it.

although it seems that the economics are still that an email/data plan would usually be cheaper than using text messages, at least it's a fair choice.

but if you and your counterpart already have an email/data plan on your phone, i really don't understand paying extra to text via phone instead of email via phone.

[Lorien]

45. I'm with you on this. It seems pointless; overpriced, gimmicky, and dangerous

In the hands of people on the road.

[Lorien]

44. Driving while texting= begging to win a Darwin award . Nt

[LibinMo]

6. I got rid of AT&T last year

& went Virgin Mobile 300 min talk, unlimited web, messaging & email for $25 month. ($26.97 with tax) They raised their prices $10 month this summer but it is still a bargain. Fortunately I'm grandfathered in at the old rate. I have never exceeded the minutes but you can get the same plan with 1200 min talk time for $10 more. $20 more unlimited everything.

Now if I could only get rid of AT&T internet service !

[ejpoeta]

12. how is virgin mobile for service? we have verizon and will be coming up on contract completion soon

and were thinking of trying out some of these all inclusive types of cricket, virgin mobile or smart talk or something. just not sure of service. between three of us we use about 300 minutes and a LOT of texts. we have basic phones though. i did try a smart phone for a month but it was too expensive with the $30 extra for the data plan on top of the 120 we were already paying.

[onehandle]

13. Virgin Mobile is a Sprint network company. nt

[Fuddnik]

15. Straight talk is on the Verizon network.

No family plans, but $30 for 1000 min, 1000 texts, and 25mb of data. $45 for unlimited everything.

I've had them for a couple of years, and get great service all over the country. Even in the boonies.

[ejpoeta]

17. thanks! maybe i'll try them. i wonder if i could take my phone there if they are verizon. i think

so. my husband now has a verizon work phone so he may just drop his home one when his contract is up and save us the money that way. then i could get a smart phone and pay the $45. his work gave him a smart phone. and my daughter doesn't need much. she mostly texts or talks to us. thanks! now i think i know where i will start my trying. i think my contract is up next month.

[LibinMo]

30. Here is a link to their coverage map:

http://www.virginmobileusa.com/check-cell-phone-coverage

I am in Springfield MO, and haven't had any problems with service. If you are in a rural location or travel a lot this might not be the way to go.

You have to buy the VM phone. I have the Samsung Intercept and have no complaints about it. This month VM came out with the Motorola Triumph phone. I would really like to have one but cost is an issue. I figure it will go on sale at Best Buy or Target before Christmas.

Oh, and the Intercept is compatible with Ford Sync. Another reason I bought it.

[Luciferous]

34. They use the same network as Sprint, so I've never had a problem except

when I am in really rural areas. I have a Blackberry and pay $35 a month for 300 minutes plus unlimited texting and data. My husband and daughter have the $25 plan which also includes unlimited texting a data. If you live in an area that has good coverage through Sprint I would highly recommend Virgin Mobile.

[frazzled]

10. Paying per text is not insane

... if you only send or receive a couple of texts a month.

We forewent the texting option when we (had to) sign up with AT&T because the spouse and son wanted/needed iPhones. None of us really uses texting on any kind of regular basis. On the rare occasion it becomes necessary to send or receive one, twenty cents isn't bad. We maybe spend a dollar or two a year.

But I agree that it is completely nonsensical that texts should be so expensive. It's because they are a fad and people are willing to pay for them. Frankly, just leave a voicemail.

[sfpcjock]

14. K&R, Thanks for posting. Here's the piece from Thom Hartmann...

from two days ago. The guest said exactly this.

http://www.youtube.com/watch?v=nAgHmB8zFMA&feature=channel_video_title"> AT&T & T-Mobile - The end of competition - The Big Picture RT, 8-23-11

[hifiguy]

16. I don't think I've ever sent 20 texts in a year.

So I will pay the $.20/per. To me it's a useless technology.

[RegieRocker]

18. Text messages cost them .0001

[ChromeFoundry]

19. How do you think they could afford to buy T-Mobile???

They have raised the consumer costs on every product offering and reduced the service offerings.

Starting in September, if you subscribe to AT&T for DSL or U-Verse, you will be capped at 150 or 200GB, respectively, of total bandwidth usage per month. Overages will cost you $10 per 50GB increment. And since U-Verse uses the same technology, ADSL - your downloads speeds will be maxed at ~5Mb Down and ~750Kb Up, assuming you have a very good connection and live close to their central office.

These Bandwidth CAPs also applies to their Small Business DSL subscribers... Imagine trying to run a business under those constraints!

Now they are doing the same thing in their wireless offerings.

AT&T (which is really SBC) make very healthy profits under their flat-rate pricing model, but instead of upgrading networks, gateways and infrastructure to stay competitive and entice customers to want to keep their service, they dump those profits into investor pockets, lobbyists, and of course exorbitant executive bonuses. I hope AT&T loses all of their customers and Ed Whitacre, CEO, is forced to live under a bridge.

[DainBramaged]

24. I JUST dropped AT&T and went with Verizon AFTER i READ THIS op

$69.95 unlimited calling, 250 text messages a month for $2.50. I've had it with AT&T's bullshit. I was paying $102 a month (including taxes and fee) for unlimited and 1000 text messages. Now it will cost $83.

FUCK AT&T, FUCK THEM

[TorchTheWitch]

33. I never understood the point to texting

Why in the world can't people just TALK on the phone???

[Fastcars]

41. Texting is perfect for.....

When you don't need to talk to someone but do need to get them a message.

My girlfriend isn't allowed to get calls on her cell at work, and I don't like to call the office number for non-emergencies. I can call and leave a voice mail that she will have to go through all the voice mails on her phone to check. Or I can send her a text to let her know there is a change in plans for the evening, pick up dog food on the way home, etc.... that she can read at her convenience.

I also love receiving texts for the times I drive a friends limo. No chance for me to transpose numbers or not understand the name of a street I don't have to try and come up with a pencil and paper while I am working at my other job to jot it down.

edit for typo and punctuation error

[ejpoeta]

42. i text a lot more than i thought i would. i text my husband all the time and he texts me.

like when he is working and i don't want to bother him that way he can look at it when he gets a chance. he never checks his voicemail. it takes up minutes to do that. we are at the point that we use about 300 minutes between our two phones and our daughter's phone but we do text a lot. i text him lists of things we need at the store. information he might need. ask how he is doing when i am not sure what he is doing and don't want to be bothering him if he is working. he can call me back when he gets the chance. my sisters text me all the time. we all have unlimited texting. it's like instant messaging online.

[sudopod]

43. AT&T is great

unless you like making phone calls or using the internet.