By Dr. Giovanni Tapang, Ph. D.

One of our country’s outstanding scientists, the chairperson of AGHAM—the association of Filipinos scientists devoted to making science work for the people—and a columnist of The Manila Times, Dr. Giovanni Tapang has computed the real cost of a text message.

He began his explanation recalling that in a State of the Nation Address (SONA), President Gloria Arroyo said that the price of text messages charged by telecommunications companies was only P0.50 because of their promotional discounts. But customers who did not participate in the schemes that gave them discounts, were charged P1 per text.
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Let us make a back-of-the-envelope estimate of the cost of sending data through the cell phone network. Let us start with the basics. SMS or popularly known as text is sent through the airwaves as data packets similar to the Internet that we are all familiar with. There are several ways to send this data over the cellular network.

SMS was inherent in the design of the GSM (Global System for Mobile communications) network but is now carried over even in the newer 3G networks. For internet rates, either through 3G or through GPRS (General packet radio service), telcos currently charge a flat rate of approximately P10 per half an hour for data transfer.

At GPRS data rates, typically at 56 to 114 kilobits per second, which means that at its slowest speed, it can send out the whole of Noli Me Tangere in around three minutes. At P10 for half an hour, sending the whole of Noli would cost around a little bit less than P1.

The whole work of Dr. Jose Rizal contains around 1.15 million characters while a single text message contains only 160 characters.

This means that to send one text message costs around one hundredth (0.01) of a centavo! Even if you factor in for administrative costs, we would end up way below the 50 centavos that we have right now.

At slower GSM rates, the cost of sending a text would still be a fraction of a centavo. Using faster networks like the 3G would bring down this cost even further.

We should probably ask for refunds since apparently the telcos can still make a hefty profit at half a peso per message when it really only costs a fraction of a centavo to send a text. The National Telecommunication Commission and the Bureau of Internal Revenue should work together to find out how much the telcos and the government owe the consumers and to find out the quickest and most fair way of undertaking a refund. The government should also bring back the Value Added Tax (VAT) it collected in these overpriced texting rates that we were paying and work to push down further the costs of texting.

Inherent, integral function

It has been argued that since SMS is an inherent and integral function in the design of the GSM system and its successors, it should have been given free as part of the use of the network. Telcos did not add anything to their towers to enable SMS, it was there in the system to start with. But even if we grant the claim of the telcos that SMS is a value added service, then the telcos should be able to tell us how much it costs to maintain the service since the Public Telecommunications Act of 1995 requires them to maintain separate books of accounts for these value added services.

The claim of government in reducing texting rates becomes suspect since SMS/text was one of their target for new government taxes. For several years, the finance department, upon the urging of the International Monetary Fund, wanted to impose “sin” taxes on text. It stopped only when texters, led by the consumer group TXTPower, revolted (through texting of course) and sent a barrage of protest messages to top government officials. Had it pushed through, text messages would have cost P1.50, with P0.50 going to the government.

Instead of riding on promotional rates by the telcos, the government should institute a way to provide permanent lower rates for voice, texting and even the Internet. Besides the costs of texting, we should also note that there are still the perennial complaints of “lost” load, intermittent service and coverage, as well as text spam and messages that hound the texting public.

4,500 times overpriced

Yet despite these concerns, SMS has grown to be very popular not only in the Philippines, the erstwhile texting capital of the world, but is used across more than 200 countries by over three billion people in 2007.

The popularity of SMS only reflects our need to communicate with each other and texting provides one of the cheapest way to do that (although at current rates, its around 4,500 times overpriced!). We communicate through text with our family members working abroad or in the provinces, transact business, join games or send messages to our loved ones. It is thus important to keep texting genuinely affordable and accessible to all.