OXFORD, United Kingdom—Having planned to capitalize on the booming short message service (SMS) market by increasing its messaging charges by nearly 140 percent, Germany’s T-Mobile has backed down after a wave of consumer and political protest. The company said new customers can now decide whether they want to subscribe to the old billing model or choose a new one that charges more for SMS, but has a lower monthly fee.
Consumer groups complained that any price increase would mostly affect private users, especially teenagers and young adults, who are the most frequent SMS users. One senior German politician said that, if the increase had gone ahead, he feared that young mobile users could run into debts by using SMS. However, a T-Mobile spokesman said that most of the company’s young customers are using prepaid services, so they are not affected by the proposed price increases.
Despite T-Mobile giving in to public pressure, some industry watchers expect cell-phone operators to still increase prices for the highly profitable SMS service to recoup losses from 3G investments. Other mobile providers are reported to also have plans for charging more for SMS. In January, several networks already raised SMS fees for business subscribers.
Separately, BT Cellnet has agreed to a deal with French-based Freever to offer SMS chat services to the company’s 11 million mobile users. The new service, called Txt Chat Rm, allows BT Cellnet users to enter secure, text-based discussion forums or anonymous chat rooms. Freever is said to be attempting to develop other messaging systems, like video messaging, for BT Cellnet subscribers.
