Text Messaging Woes - T-Mobile

Text Messaging Woes? - T-Mobile

A law firm has sent out a general note asking for comment as they consider suing T-Mobile because T-Mobile won't turn off text messaging for specific consumers.

Well - this seems to be a fairly easy issue to resolve. If US carriers were to adopt the "sender pays" model of mobile network operators across Europe - the issue would go away.

There are 2 other possible options:

1. Change the model for some consumers so that it is free to receive.
   If the consumer isn't going to get charged - there is still the annoyance factor - but there is no longer a commercial impact.
   
   
2. Deactivate the E-mail to SMS Gateway based on consumer request.
   This is fraught with pitfalls because invariably the consumer who wants to have the gateway turned off still wants to get their updates from United Airlines when the gate changes - and they will not necessarily understand how this is related.
   

T-Mobile operates a GSM network - and text messaging is integral to the network infrastructure. Without getting into too much technology - text messaging uses the same process as making your phone ring. Turning off text messaging completely means no longer receiving calls either.

And as I mentioned above - what is the real driver here? Is it cost? - Is it mobile SPAM? - or is it that T-Mobile isn't Burger King - and you can't "have it your way."?

A bit of extra insight...

In GSM networks outside the US the commercial model says that only the person who sends the message pays. ( Yes - there is an exception in the case where the receiver is roaming internationally ).

Of course it isn't as simple as just changing the commercial model - there is one other major factor in the US market which has to be reviewed: E-mail to SMS gateways.

Literally 100's (if not 1,000's) of businesses make use of the ability to send an e-mail and have it appear as a text message on a consumer's mobile device. These e-mail to SMS gateways are free and used for services such as flight time departure updates - service delivery updates - even birthday messages. And if you change the commercial model to one where the sender pays, then all of these gateways have to be upgraded so that they can charge.

If all e-mail to SMS gateways started charging the businesses ( rather than the customer who receives the message ) then many of these services would go away. And what that means is that the carriers would see a drop in revenue.

Four years ago I talked with Verizon about this topic during a meeting of the Mobile Marketing Association. Not only were carriers worried about losing revenue from shutting down the e-mail to SMS gateways - there was another reason why they needed these gateways to exist - consumer education.

Text messaging is part of everyday life for most people across Europe. But in the US it is only now starting to catch on. The first text message voting show - American Idol - allowed text messaging to break into the public consciousness in the US - but there is still a long way to go before US carriers could achieve up to 20% of their revenues from text messaging - like their European counterparts.

I often get asked the question, "Why isn't text messaging big in the US?" - And there are a number of reasons - but the most significant are these:

• Until April 2004 it wasn't possible to send a text message from one network to another. The US has 2 main technologies for mobile phones - CDMA and GSM. Text messaging was developed by a bunch of engineering geeks almost as a "fluke" associated with the GSM networking standard. CDMA had to develop it's own implementation of text messaging from scratch. {Some SMS History}


• Economics 1: The GSM model outside the US is "sender pays" - meaning that you never pay to receive a text. In the US you get charged to receive a text message or it counts against your total number of text messages for the month. (Different carriers have different packages including some which are all-you-can-eat-send-or-receive ) As long as a consumer "might" get charged to receive a text - they weren't interested. Some people would actually call up their friends and say, "Stop sending me text messages!"


• Economics 2: The text message phenomenon in Europe occurred largely because it was cheaper to send a text message than it was to make a 1 minute voice call. Admittedly, voice calls from mobile phones in Europe are much more expensive than in the US. And here again - there are a couple of drivers. 1) the majority of people in the US are on contracts - which include 100's or 1000's of free minutes. The majority of people in Europe are on pre-paid arrangements with an average balance of £5 at any given time. The bottom line - A US mobile user says, "It's free to call someone - it may cost me to text them - plus texting is hard to do!"


• A minor 4th point: Voicemail. People in the US love their voicemail. Everyone has voicemail - some people have 2 voicemails. In Europe voicemail is much less prominent because mobile operators charge consumers for voicemails - (and frankly the Italians just don't like it!) Without voicemail, Europeans love to send text messages as it is a cheap and easy way to get a message across even if a person is unavailable.
  

So - those are some of the reasons why SMS is different in the US than it is in Europe - and some of the reasons why you don't have law firms considering whether or not they should sue T-Mobile.