Facebook May Bust Up the SMS Profit Cartel

AndyAndyAndyAndy writes "Fortune had an interesting article recently about wireless providers and their exorbitant profit margins for SMS handling, especially when looking at modern data plans. 'Under the cell phone industry's peculiar pricing system, downloading data to your smartphone is amazingly cheap — unless the data in question happens to be a text message. In that case the price of a download jumps roughly 50,000-fold, from just a few pennies per megabyte of data to a whopping $1000 or so per megabyte.' A young little application called Beluga caught the attention of Facebook, which purchased the company a Thursday. The app aims to bring messaging under the umbrella of data plans, and features group messaging, picture and video messaging, and integration with other apps. The author argues that, if successful, Beluga (or whatever Facebook ends up calling it) could potentially be the Skype/Vonage or Netflix-type competitor to the old-school cellular carriers and their steep pricing plans."

Google Voice and TextFree

[Mean Variance]

I've found the available workarounds are sufficient to the point that I could give a crap about texting fees. I use GoogleVoice and TextFree and they work great. My wife uses Virgin Mobile for $25/mo (that's it no extra taxes or garbage) and can text to her delight.

Re:except

[Anonymous Coward]

My cellphone bill says otherwise. Saved $30 a month by switching to google talk for international texting.

Re:except

[Anonymous Coward]

Sorry, but that is not universally true. Even back to the days of the T-Mobile Dash Windows Mobile phone I had. It depends on how the developer creates the IM client. On the Dash if I used (if I remember correctly) AIM it used the data plan. However if I used ICQ or Y! it used SMS to send the "instant messages". Not because T-Mobile charged that way, but because the apps did indeed use SMS to send the "instant messages". Even today on Android, if you use GTalk to instant message, it uses your data plan. Same goes for lots of other IM clients. However if the IM client was created to use SMS then you better have an unlimited SMS plan!!!

Re:Another retread

[Anonymous Coward]

With Beluga, the recipient doesn't have to have *anything* more than SMS capability. They will be charged SMS fees until they get it, but they're still capable of participating in group chat sessions without other individuals in the Beluga Pod.

I don't believe Google Talk or any other IM system can do that. I could be wrong...

Re:Another retread

[blueg3]

So it's Google Voice, but without the other features.

Re:I hope this actually puts some pressure ....

[Anonymous Coward]

Yes, you would get billed for those 1000 received messages. You'd have to call customer support, explain what happened, ask them to block all incoming texts to your device, and then- maybe- you might be able to negotiate a refund.
But they're not crooks, it's all perfectly legal... as long as you do it on a large enough scale.

Re:except

[trapnest]

That's not really the case, most of the dumbphone "IM" applications are really sending IMs over SMS.