It is quite a coup, especially because text messages are essentially free to the carrier:

Looking for a data pipeline that would fit these micro messages, Hillebrand came up with the idea to harness a secondary radio channel that already existed on mobile networks.

This smaller data lane had been used only to alert a cellphone about reception strength and to supply it with bits of information regarding incoming calls. Voice communication itself had taken place via a separate signal.

"We were looking to a cheap implementation," Hillebrand said on the phone from Bonn. "Most of the time, nothing happens on this control link. So, it was free capacity on the system."

via: http://latimesblogs.latimes.com/technology/2009/05/invented-...

Maybe for the radio part of it, but between cell tower and service center (and vice versa), SMS goes over the signaling links - which are also used for call setup, notifications, WAP push, and routing queries.

Theres nothing free about them, theres no such a thing as free in the telco world - everything costs someone something, though I agree, SMS is extremely cheap for the carrier - definitely NOT worth paying 20 cent for. Carriers love SMS for that exact reason.

Having said that, SMS can also cause the carrier a world of pain... I obviously can't provide any details, but one specific network had a problem where two thirds of all signaling traffic was caused by some virus which a large percentage of their customers' phones were infected with. This was costing them many thousands a day! Thankfully, we were able to block these messages at an early stage in the transaction and reduce network traffic by a substantial amount and over the air traffic by about half.

They are essentially free, because the carriers provide no delivery guarantees for SMS messages. That is, if the channel is busy with other signalling traffic, then SMS messages will be silently dropped.

The TCAP transaction would be retried approx. ten minutes later, up to three times (on the networks I've seen, anyway).

That is true for original GSM networks. However SMS might be using a data channel for delivery instead of control in the latest EDGE,CDMA.

I googled for UTMS 3G (the most usual here in europe), and they still use the FREE signal channel:

"On umts, sms is packet switched - bit rate will be 16k...... cos it is sent on signalling channel."

ref: http://www.wirelessforums.org/uk-telecom-mobile/anyone-know-...

If they were using the regular data channel, and they charged the regular (even though they are inflated as is) data prices, this would be a non-issue.

It's like if the USPS decided to charge a buck for post cards because people liked them more, so the logical thing to do would be to just stick the post-card in an envelope, but then the USPS declared that illegal and outlawed post card sized envelopes.

Quick recap - founding of SMS:

"Mr Matti Makkonen had discussed the idea of a Message Handling Service for GSM digital mobile phone in 1984 in a pizzeria in Copenhagen with two other Finns Mr Tiainen and Mr Tapiola during a conference of mobile phone communication's future.

When the development of GSM digital mobile phone standard was extended from the Nordic countries initiative to the global ETSI workgroup, the idea of SMS was proposed to be included as a global standard. "Without this international collaboration SMS would not have become a global success story", says Makkonen.

Mr Makkonen, did not receive financial payback for his pioneering work because he didn't apply for a patent. "At that time there was an open sharing of ideas by monopoly operators so we never even considered to write a patent application" said Makkonen. "We just started to spread the idea and take care of it into the specifications. The mobile system today is open source and developed from innovations by hundreds of people" he said."

http://www.bookit.net/news/en_GB/makkonen_economist/

We don't know that this is still the case. Text messaging is very popular, and what was once a little-used patch of bandwidth might not be so spare these days. This is not to say that the charges are warranted (except that people pay them) but that the 1985 unused-band consideration isn't as applicable.

This is the basic problem. Geeks like the idea of unlimited bandwidth, but it really isn't a possibility. Physics tells us that you can't have it, especially over wireless.

The only scarcity is in your cell, right now. In 99% of cells, txt messages are free as the signal time slices are going unused (no other texters, low signalling use). At, say, a rock concert, the wireless tubes might be crammed but that's why SMS doesn't have a latency (or delivery?!) guarantee. Also, a mobile base station could be set up at the concert to get more airwaves or there may not be enough voice channels.

So... txt messages are essentially free.

I saw a great writeup explaining how it is cheaper to send an equivalent amount of data to one of the Voyager spacecrafts, than it is to send it by SMS.

link?

This seems to be the source:

http://www.theregister.co.uk/2008/05/14/txts_r_v_pricey/comm...

IIRC, with some carriers it can even be $35/message. The part that irks me the most is,"You get charged 20c/message to receive messages. Oh, and by the way there is no way for you to prevent a text message from being sent to you."

That must be an American thing. I've never heard of someone having to pay for incoming messages.

It's a recent can&usa thing (was introduced in canada several months ago). It's very likely just a scheme to coerce most subscribers to get a text messaging plan and boost their ARPU by $3 to $10 dollars, since all of the 'plans' have free incoming texts.

I hadn't either, but then I was from the UK. I moved to Canada and they started bringing it in, I was thankful I was on Rogers who didn't introduce it . . . and then the recession hit and they BS-backtracked and implemented it.

Oh well, time to hunt the unlimited smartphone data plans.

Too bad about being in Canada. Canadian data plans suck compared to the US ones. The US doesn't have that much competition for cell plans, but Canada has even less (2 carriers; Bell or Rogers).

Agreed the competition is bad, there are more carriers in ontario, however they're either the big three, or a second brand name for one of the big three (Bell, Rogers and Telus).

Bell has access to the unlimited data plans, and now has a phone worth it (in the Palm Pre). However Bell's customer service is appalling. Basically unless you contact the BBB every time you have a problem, nothing will get done.

Definitely a north-american thing, I have not seen it in any other part of the world.

You can have SMS blocked, but you have to call them and request it specifically. I believe the salespeople try to frighten you into getting one, warning you of the dangers of receiving an SMS without a plan.

Whoa... just re-read my post and that was supposed to be $0.35/message... not $35/message. O.o It's too late to edit it though. Sorry for the mis-information.

But as others have said 20-35 cents per message can add up pretty quickly. The entire point of that price is to convince you that it's better to just pay the $10/month for unlimited text messaging. I mean text messages are a max of 140 characters. That's a minuscule amount of information in comparison to voice calls or data plans (checking email,websites,etc) yet they charge an arm and a leg for it.