Customers have been plenty annoyed by the sharp hike in SMS and MMS message fees to twenty cents each direction, netting wireless carriers massive profits ($1300 per MB by some estimates). For the better part of five years Verizon Wireless (NYSE: VZ) has allowed companies to send text messages to its subscribers without a fee, but the carrier is telling its partners that will all change. Verizon Wireless, which allowed companies to send SMS to it’s subscribers without a fee, will be charging 3 cents per message processed on it’s network from November 1. This step by Verizon will surely affect the companies who use SMS as the biggest advertising tool. Everything from text alerts to interactive voting notifications and SMS search will be costing the companies. According to the email notification sent out by the carrier, the fee will apply to standard and premium programs, but not to text-giving or free-to-end-user campaigns.
Steve Livingston, the director of marketing for mBlox, which processes text messages for companies including News Corporation’s MySpace social network and The New York Times, said the volume of messages it handles could fall by more than half. “Alert services and social networks don’t work at 3 cents,†Mr. Livingston said. Jeffrey Nelson, a spokesman for Verizon, said the company was exploring ways to charge fees to commercial senders of text messages to add a new revenue stream to its wireless business. “It is not a free service,†Mr. Nelson said. “It didn’t cost us zero to build or to buy spectrum rights.â€
