SMS at $1000 per megabyte too expensive for business

Stan Beer
Tuesday, 13 September 2011 17:08

Business IT - Technology

An Australian company that specialises in telecoms bill optimisation claims that businesses are wasting a fortune by allowing their employees to use SMS texting on corporate mobile phones. The company claims that SMS messaging is costing businesses as much as $1000 a megabyte, while much much cheaper data messaging alternatives are available.

 

Telco billing software firm The Full Circle Group says it has completed an examination of business SMS usage and costs using 3 years of billing data, comprising over 250 business clients and 2 million SMS messages.

According to the study, a significant proportion of SMSs are sent during business hours and not necessarily for business:

'¢    12% of all mobile phone costs are created by staff sending SMS
'¢    Only 45% of SMSs are sent during business hours (8am-6pm)
'¢    Of the SMSs sent during business hours, only 32% are to other staff members
'¢    30% of SMS costs are generated on weekends, and only 0.4% of these SMSs are sent to other staff members.

The study claims that given an SMS is no bigger than 160 bytes, the cost to send an SMS, as a proportion of the data it uses to traverse the network, is disproportionately large and therefore outrageously expensive for business use:

Year    Av Cost/SMS             Cost/MB
2008    $0.32                       $2,097.00
2009    $0.21                       $1,376.00
2010    $0.19                       $1,245.00
2010    $0.16                       $1,048.00

According to the study, businesses can acquire mobile data plans of 10GB worth of download allowances for around $49 per month (less than 0.5 cents per MB). However, the cost of sending SMS is over $1,000 per MB.

Businesses wishing to avoid exhorbitant SMS costs, according to The Full Circle Group, could consider the following options:

1.    With a fleet of Blackberries, send SMS equivalent messages via an email or via Blackberry messenger (a dedicated SMS substitution product on most Blackberry devices).

2.    With iPhone and Android devices, applications such as Whatsapp (which now works across most platforms) effectively let you SMS over your data allowance.