October 11, 2008

 

SMS Landing Charges

Verizon Wireless, the #2 wireless telecom operator in US, plans to charge 3 cents SMS landing on their network. Sending SMS costs between 2-10 cents depending on the pre-paid plan you buy. Effectively, the landing charges of SMS is anywhere between 33%-150% of what it costs to send a message. Verizon spokesperson justified the charges saying “It didn’t cost them zero to build or to buy spectrum rights.”

What happens if the same scheme comes to India? Well, it won't. Why? In majority of the markets, users do pay to receive call. In India, too, in early days, such charges were applicable. Results? Not too many picked the call if they didn't know who was calling. In early 2003, incoming charges were eliminated. That definitely was one of the crucial developments which resulted in explosion of mobile services. So, let's not worry about charge for incoming SMS in near future.

What happens to the hypothetical situation when it is applied selectively to only the entities which send bulk messages? It's difficult to completely rule out this possibility.

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