How Much Does Text Messaging Cost Carriers...?

[Doc]

'Turns out it's as close to nothing as to make no odds.

http://www.nytimes.com/2008/12/28/busine....html?_r=1

...text messages are not just tiny; they are also free riders, tucked into what’s called a control channel, space reserved for operation of the wireless network.

That’s why a message is so limited in length: it must not exceed the length of the message used for internal communication between tower and handset to set up a call. The channel uses space whether or not a text message is inserted.

Professor Keshav said that once a carrier invests in the centralized storage equipment — storing a terabyte now costs only $100 and is dropping — and the staff to maintain it, its costs are basically covered. “Operating costs are relatively insensitive to volume,” he said. “It doesn’t cost the carrier much more to transmit a hundred million messages than a million.”

[incognegro]

why don't you work for free!!!?

[Carnos Jax]

Not the same thing.

[incognegro]

that was a joke, son.

[freeradical]

Ma Bell used to subsidize expensive (due to the cost of the loop) local phone service with long distance service.

[Carnos Jax]

Yes sir, sorry 'bout the mixup boss...:-)

[Seacrest]

You guys must have read different Econ 101 textbooks than I did.

The price of a good or service has very little to do with the cost of production, but rather what the market will bear.

In this case, the market for "txting" has -- at this point in time -- decided it is willing to pay "x" per txt or "xx" for a specified level of nn to infinity txts.

That doesn't mean, of course that the market will always bear that price.
Disruptive technologies will undoubtedly soon appear that circumvent the producers' physical stranglehold on txt distribution, and they will then be forced to lower their prices, and of course this being the new era of "free market orthodoxy," reluctantly ask the government for a bailout.

[RAMd®d]

You guys must have read different Econ 101 textbooks than I did.

And what guys are you referring to? Don't pat yourself on the back too soon.


That doesn't mean, of course that the market will always bear that price.


Of course it doesn't. And what the market will bear depends on several factors.

People often accept the cost of production as a reasonable cost of doing business. Knowing the cost of production can and sometimes *does* affect the buyer's perception of value and purchasing decision.

The seller then has to decide if that decision on the part of the buyer is significant enough to affect the asking price, or does it need to be adjusted.

Several factors can sway the balance of sellerss and purchasers' power.

Knowledge can be power in its own right.

All part of Econ 101.

[Carnos Jax]

RAMd®d wrote: ...Knowing the cost of production can and sometimes *does* affect the buyer's perception of value and purchasing decision.

The seller then has to decide if that decision on the part of the buyer is significant enough to affect the asking price, or does it need to be adjusted.

Several factors can sway the balance of sellerss and purchasers' power.

Knowledge can be power in its own right.

All part of Econ 101.

So true. I've done a fair bit of reselling on 'fleabay' and Craigslist. I've learned that if a buyer 'knows' what a particular item cost you, they're far less willing to pay your 'marked up' asking price.

[Seacrest]

You DO realize my whole post was tongue-in-cheek, right?