Comments on: Text Messaging is the Biggest Scam of the 21st Century http://weakonomics.com/2009/05/07/text-messaging-is-the-biggest-scam-of-the-21st-century/ Everything That's Wrong With You And Your Money Fri, 19 Mar 2010 21:39:34 +0000 http://wordpress.org/?v=2.9.2 hourly 1 By: the weakonomist http://weakonomics.com/2009/05/07/text-messaging-is-the-biggest-scam-of-the-21st-century/comment-page-1/#comment-2694 the weakonomist Wed, 22 Jul 2009 01:47:51 +0000 http://weakonomics.com/?p=1903#comment-2694 neil your heart is in the right place however collusion need not occur in secret. Collusion occurs simply when an oligopoly stops competing with eachother. Verizon and AT&T are both please dwith their market dominance and neither see any reason to adjust prices to gain new share. I do agree though a 100% free market capitalist cannot complain about this. I'd call myself an 85% free market capitalist. Sometimes, I do believe the government provides a necessary function in setting rules and regulations to keep competition going. I do however like to keep such intervention to a minimal intrusion. neil your heart is in the right place however collusion need not occur in secret. Collusion occurs simply when an oligopoly stops competing with eachother. Verizon and AT&T are both please dwith their market dominance and neither see any reason to adjust prices to gain new share.

I do agree though a 100% free market capitalist cannot complain about this. I’d call myself an 85% free market capitalist. Sometimes, I do believe the government provides a necessary function in setting rules and regulations to keep competition going. I do however like to keep such intervention to a minimal intrusion.

]]> By: neil http://weakonomics.com/2009/05/07/text-messaging-is-the-biggest-scam-of-the-21st-century/comment-page-1/#comment-2691 neil Tue, 21 Jul 2009 22:51:24 +0000 http://weakonomics.com/?p=1903#comment-2691 Collusion requires some kind of behind the scenes negotiation. Simply looking at another company's published price and saying "y'know, we'll make more money by matching it than competing with it" is just accounting. Raising fees at "about the same time" isn't the same as simultaneous announcements...one company just took the chance that if they increased their prices, others would follow. And this is why I get really confused with people who supposedly prefer a free market to government control. In a free market, prices are set based on where a product/service provider can maximize profit, not "cost + margin" that most people seem to think they should. So, yeah, I think text messages are unreasonably priced, and don't use them (with rare exceptions, discussed below). In comparing with voice calls, the relevant comparison is in how much information - as opposed to data - you can communicate for a price. Note that this is difficult to quantify. Texts are a fairly restrictive medium, so they don't contain as much information as a phone call, so generally the phone call is more cost effective. However, international phone calls cost a fortune, and I do use texts when email is not an option for whatever reason. Collusion requires some kind of behind the scenes negotiation. Simply looking at another company’s published price and saying “y’know, we’ll make more money by matching it than competing with it” is just accounting. Raising fees at “about the same time” isn’t the same as simultaneous announcements…one company just took the chance that if they increased their prices, others would follow.

And this is why I get really confused with people who supposedly prefer a free market to government control. In a free market, prices are set based on where a product/service provider can maximize profit, not “cost + margin” that most people seem to think they should. So, yeah, I think text messages are unreasonably priced, and don’t use them (with rare exceptions, discussed below).

In comparing with voice calls, the relevant comparison is in how much information – as opposed to data – you can communicate for a price. Note that this is difficult to quantify. Texts are a fairly restrictive medium, so they don’t contain as much information as a phone call, so generally the phone call is more cost effective. However, international phone calls cost a fortune, and I do use texts when email is not an option for whatever reason.

]]> By: Matt Keally’s Blog » Rising from the failure of bad business models http://weakonomics.com/2009/05/07/text-messaging-is-the-biggest-scam-of-the-21st-century/comment-page-1/#comment-2314 Matt Keally’s Blog » Rising from the failure of bad business models Sun, 31 May 2009 22:23:37 +0000 http://weakonomics.com/?p=1903#comment-2314 [...] messages are by far the most profitable:  receiving 160 bytes costs around twenty cents — this works out to $1.5 million per gigabyte — that’s only for the size of a compressed HD movie!  With the advent of data plans, [...] [...] messages are by far the most profitable:  receiving 160 bytes costs around twenty cents — this works out to $1.5 million per gigabyte — that’s only for the size of a compressed HD movie!  With the advent of data plans, [...]

]]> By: Curious Cat Investing and Economics Carnival #2 at Curious Cat Investing and Economics Blog http://weakonomics.com/2009/05/07/text-messaging-is-the-biggest-scam-of-the-21st-century/comment-page-1/#comment-2216 Curious Cat Investing and Economics Carnival #2 at Curious Cat Investing and Economics Blog Thu, 14 May 2009 17:51:24 +0000 http://weakonomics.com/?p=1903#comment-2216 [...] Text Messaging is the Biggest Scam of the 21st Century - “The cost per GB of cable internet is $0.75… the cost per GB of cell phone data $6.00… the cost per GB of text messaging data is $800…” [...] [...] Text Messaging is the Biggest Scam of the 21st Century – “The cost per GB of cable internet is $0.75… the cost per GB of cell phone data $6.00… the cost per GB of text messaging data is $800…” [...]

]]> By: Doctor S http://weakonomics.com/2009/05/07/text-messaging-is-the-biggest-scam-of-the-21st-century/comment-page-1/#comment-2205 Doctor S Wed, 13 May 2009 15:56:51 +0000 http://weakonomics.com/?p=1903#comment-2205 Excellent analysis, changes def need to be made, I am all for texting just b/c I utilize it 100x more than voice minutes. I have been on a Tmobile Sidekick plan since 2003, I truely believe it is the best bang for your buck, at least for me. $20/month for Sidekick data plan which includes unlimited internet, email, texting, AIM. 39.99 for my phone plan of 600 anytime minutes and free nights and weekends. I send/receive 6k txts a month and barely use my phone for 300 minutes a month. <abbr><em>Doctor S’s last blog post..<a href="http://feedproxy.google.com/~r/FinanceYourLife/~3/Ik1E0Qs8Ors/i-spend-too-much-money-on.html" rel="nofollow">I Spend Too Much Money On ...</a></abbr></em> Excellent analysis, changes def need to be made, I am all for texting just b/c I utilize it 100x more than voice minutes.

I have been on a Tmobile Sidekick plan since 2003, I truely believe it is the best bang for your buck, at least for me. $20/month for Sidekick data plan which includes unlimited internet, email, texting, AIM. 39.99 for my phone plan of 600 anytime minutes and free nights and weekends. I send/receive 6k txts a month and barely use my phone for 300 minutes a month.

Doctor S’s last blog post..I Spend Too Much Money On …

]]> By: Belated Weekly Roundup | StupidCents http://weakonomics.com/2009/05/07/text-messaging-is-the-biggest-scam-of-the-21st-century/comment-page-1/#comment-2191 Belated Weekly Roundup | StupidCents Tue, 12 May 2009 14:40:33 +0000 http://weakonomics.com/?p=1903#comment-2191 [...] Weakonomist @ Weakonomics talks about the uber costs of text messaging. Take a look to find out what you really are spending each time you [...] [...] Weakonomist @ Weakonomics talks about the uber costs of text messaging. Take a look to find out what you really are spending each time you [...]

]]> By: the weakonomist http://weakonomics.com/2009/05/07/text-messaging-is-the-biggest-scam-of-the-21st-century/comment-page-1/#comment-2186 the weakonomist Mon, 11 May 2009 18:13:04 +0000 http://weakonomics.com/?p=1903#comment-2186 There are a number of alternatives to the normal text message, especially for us iPhone users. The problem is that without moving everyone to one universal system you are always left in the dust. If someone wants to text you, they're first thought is to text your number, not your google account, email address, or AIM screen name. I do use these services to send messages sometimes, but it does not stop other people from texting your phone, which you are charged for. There are a number of alternatives to the normal text message, especially for us iPhone users. The problem is that without moving everyone to one universal system you are always left in the dust. If someone wants to text you, they’re first thought is to text your number, not your google account, email address, or AIM screen name. I do use these services to send messages sometimes, but it does not stop other people from texting your phone, which you are charged for.

]]> By: Bargain babe http://weakonomics.com/2009/05/07/text-messaging-is-the-biggest-scam-of-the-21st-century/comment-page-1/#comment-2185 Bargain babe Mon, 11 May 2009 17:20:12 +0000 http://weakonomics.com/?p=1903#comment-2185 Text messaging is a scam. But you forgot to mention GoogleTalk - which is free instant messaging on your cell. The only difference is it doesn't make a noise or buzz when you get a new message. I wrote a post about cheap/free alternatives to texting on Bargain babe at http://www.bargainbabe.com/2009/02/03/free-alternatives-to-texting/ <abbr><em>Bargain babe’s last blog post..<a href="http://www.bargainbabe.com/2009/05/11/what-i-learned-on-mothers-day/" rel="nofollow">What I learned on Mother’s Day</a></abbr></em> Text messaging is a scam. But you forgot to mention GoogleTalk – which is free instant messaging on your cell. The only difference is it doesn’t make a noise or buzz when you get a new message. I wrote a post about cheap/free alternatives to texting on Bargain babe at http://www.bargainbabe.com/2009/02/03/free-alternatives-to-texting/

Bargain babe’s last blog post..What I learned on Mother’s Day

]]> By: Topics about Scams | Text message scam http://weakonomics.com/2009/05/07/text-messaging-is-the-biggest-scam-of-the-21st-century/comment-page-1/#comment-2172 Topics about Scams | Text message scam Sun, 10 May 2009 07:01:53 +0000 http://weakonomics.com/?p=1903#comment-2172 [...] Text Messaging Is a Big Scam and Costs Way Too Much | Weakonomi¢s [...] [...] Text Messaging Is a Big Scam and Costs Way Too Much | Weakonomi¢s [...]

]]> By: Weekly Linkfest: Stress Test Edition | Darwin's Finance http://weakonomics.com/2009/05/07/text-messaging-is-the-biggest-scam-of-the-21st-century/comment-page-1/#comment-2166 Weekly Linkfest: Stress Test Edition | Darwin's Finance Sat, 09 May 2009 19:18:11 +0000 http://weakonomics.com/?p=1903#comment-2166 [...] Text Messaging Total Scam - I couldn’t agree more.  I sound like an old fart, but I don’t use it and wouldn’t pay these insipid messages back and forth while I could be doing something useful (like this post!). [...] [...] Text Messaging Total Scam – I couldn’t agree more.  I sound like an old fart, but I don’t use it and wouldn’t pay these insipid messages back and forth while I could be doing something useful (like this post!). [...]

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