When AT&T switched to Cingular the price of sending a message dropped to 5 cents, but they started charging for incoming texts – also 5 cents. Assuming you send a message for every message you receive, this works out at about the same price as before.

AT&T came back online and phased out the CIngular brand name, and prices were again changed. This time to 15 cents each way. More changes have taken place that I can’t quite remember. At one point text messages were 10 cents either way, and at another point they even included MMS (multimedia messages) at the same price as SMS.

As of March SMS messages on AT&T will cost 20 cents and MMS will cost 30 cents – both to send a receive. So let’s do some math here, and figure out how much this simple transmission is actually costing us.

A standard SMS message contains up to 140 bytes (1120 bits) of data – this takes care of the 160 characters allowed in your text message. This might not make sense at first, until you realize that SMS uses 7 – not 8 – bit characters – leaving you with 128 possible character values instead of the normal 256. So 1120bits/7bits = 160 characters.

So our total message length is about a tenth of a kilobyte (.13671875 Kbytes). In terms that the iPod generation would understand – if you had an iPod with a tenth of a kilobyte you could fit 1/4000th of a song on it. I assume here and for the rest of this article that 1 song = 4 Megabytes.

If you divide 140 (the total number of bytes available to you) by 20 (the cost per message), you find that you are paying 1 cent for every 7 bytes of data. This leaves you with a cost of $1,497.97 for the 1024Kbytes contained in a single megabyte. iPod users: It would cost you $5,991.88 to transfer – not even to buy – a single song via SMS.

By comparison, I pay $50 a month for a soft bandwidth limit of 500 gigabytes through a local ISP. That comes out to 512,000 megabytes or 10,240 megabytes to the dollar. This allows me to transfer 2,560 songs for the same price as a Junior Bacon Cheeseburger off the value menu at Wendy’s: $1. I will use this my standard measurement for the rest of this article.

So far I can make the following statements concerning the costs of bandwidth: Cost to transfer 2560 songs:

From my ISP: $1
Via SMS messaging: $15,339,212

I’ve been getting phone calls and text messages from aggregators across the country who can’t quite believe that, from 1st November 2008, Verizon will apply a $0.03 transaction fee on every outgoing text message through it’s network.

Effective November 1, 2008, Verizon will assess a transaction fee of $0.03 for every MT message processed on its network. Please note that these message fees will apply to standard rate and premium programs. Transaction fees will not apply to Free-2-End-User, Mobile Giving, or Non-Profit organizational programs.

Pursuant to your Commercial Services Agreement with OpenMarket (including former Simplewire Agreements) concerning Third-Party/Operator Fees, in the event message fees are assessed by Verizon for any of your programs, these fees will be passed on to your company at cost. More.