It’s taken as granted that the most expensive mobile service in terms of price-per-megabyte is SMS. Even with per-SMS price of as low as 6 cents, you’re looking at a cost of around €400 per megabyte which, by all standards, is outrageous. Try comparing it to how much that bandwidth costs to the operators and you come with a profit margin unimaginable anywhere else. Yet people happily pay that because even such short messages are often very worth the money – just another case that goes to show volume-based pricing doesn’t work.
But that wasn’t really the point. Given the ridiculous price-per-MB of SMSs, it’s hard to imagine anyone paying even more than €400 per megabyte for anything. Right?
Wrong. But how does it happen? Activation fees. When you activate a service, you’re often charged many euros for the simple act of activation. The following examples from Sonera and Elisa:
- Data transfer connection charge: 8.21eur.
- Balance reminder connection charge: 4.10eur.
- Call directing connection charge: 8.21eur.
- Changing the language of your answering machine: 7.89eur
- Activation of the fax service: 7.89eur
And so on.
When looking purely at the data that actually changes when you activate a service, the change is often a couple of bytes in the OSS/BSS systems; a bit there, another here. Even if you count in the service activation propagation messages that can amount to some kilobytes, you’re still looking at cost-per-megabyte figures that greatly exceed that of SMS.
I have two main issues with this:
-
First, service activation should not cost anything. Why are you being charged for activating a service that will, in using it, just bring more revenue to the operator? It’s like paying to get in a shopping mall!
Second, if you must have an activation fee, keep it within reasonable limits! Sure, many people probably call in to activate these services, thus using up precious time of the few customer service reps that still haven’t been sacked – but they wouldn’t need to, if the operators gave convenient ways to self-activate services. Or, better yet, have all services enabled by default and allow subscribers to log in via a web-interface and self-configure everything the way they want to.
But hey, that might cause more people using what I’m sure are profitable services – can’t have that, now can we?
Well, my operator in Singapore does allow online registration for services without the teller operator. But there is still a charge for activation of services.
I wonder why.
I agree with your SMS cost comments. Here in the UK you will typically pay around 10p per SMS sent. The public seems happy to pay this because after all its only 10p. Also you can buy bundles ot SMS which work out cheaper. Why the networks don’t just reduce the cost of SMS in total is beyond me.