Rumored T-Mobile SMS Price Hike Represents A Slippery Slope

Rumored T-Mobile SMS Price Hike Represents A Slippery SlopeIt’s been reported that T-Mobile will raise its SMS rates beginning on October 1st, representing what could become a slippery slope if other carriers decide to follow suit.

The change would increase the charge for standard-rate messages –  both mobile-originated and mobile-terminated –  sent over the T-Mobile network by $0.0025 per message.  While it doesn’t sound like a large amount, it adds up exponentially for aggregators and mobile service providers who send millions of messages on a daily basis.  When the price goes up for those in the middle, the extra cost is passed along to consumers.

The biggest problem, however, is that once a major carrier can successfully raise SMS prices, other carriers are sure to follow.  Verizon attempted to enact a 3-cent increase a while back and was forced to retract given the extreme backlash from the mobile ecosystem.  Once a few carriers can successfully raise prices, the ball will already be rolling and subtle half-cent increases will take place all the time while having far-reaching implications for aggregators, mobile marketers and service providers.

Once it starts happening, those involved really have no choice.  The carriers have realized that by increasing rates for SMS, they can substantially increase revenue generated from a captive audience –  mobile marketers and service providers – that have no other choice but to comply.  It’s a prime example of the hold the major carriers in the US have on the mobile ecosystem, and the primary driver behind groups like the Mobile Internet Content Coalition (MICC) who are fighting for the same open standards that dictate the traditional Web to be applied to mobile as well.

 

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