Interconnect charges essential for SMS, says industry player

[Obelix]

i would liketo see heavy penalties for unsolicited sms advertising.

 

[Speedster]

i would liketo see heavy penalties for unsolicited sms advertising.

How about a termination fee which gets credited to the receiver of the sms. That way I'll receive VODACOM23's with a smile all day long

 

[RichS]

I see from the other posts that there is some emotion around interconnect fees for SMS. Fair enough - the thought of paying even more to networks that seem to take so much from us already is disconcerting. But the logic of the benefits of interconnect fees is there.

If the sender is not paying for a communication, then the receiver will pay. Take email as an example. There is very little cost to send email, so as email receivers, we pay large amounts for spam software to sift out the junk, we while away many hours per annum reading and deleting spam email that the software doesn't catch, and we pay for the bandwidth to download the garbage. All costs - the only thing is that these costs are not presented in one neat little invoice by one company at the end of the month, so it is difficult to focus our displeasure on something or someone that we actually know.

The recommendation by Obelix to introduce penalties sounds good and is in fact already in practice to some extent through WASPA, but this costs money too (on top of revenue gained from fines) and no matter what we may think, this money has to come from somewhere and it also comes from us via our cellular bills.

The monitoring and fining approach has it's shortcomings. What happens when you have a business like an online casino based outside of South Africa who send SMS marketing messages through a low cost service provider also outside of South Africa. Dishing out fines to these senders may be possible, but finding the senders and getting them to pay the fines is pretty much impossible. At least if there were interconnect fees, there is less incentive to spam.

So the question is really, "How would you like to pay for your communications?" and the options are, "on a sender/initiator pays basis", or "on a receiver pays basis"?

Personally, I like the sender/initiator to pay for my communications. In short, I know that the more the communication costs, the more likely the sender thought about it before sending it to me, and therefore the more likely it is to be of value to me.

 

[porchrat]

I see from the other posts that there is some emotion around interconnect fees for SMS. Fair enough - the thought of paying even more to networks that seem to take so much from us already is disconcerting. But the logic of the benefits of interconnect fees is there.

If the sender is not paying for a communication, then the receiver will pay. Take email as an example. There is very little cost to send email, so as email receivers, we pay large amounts for spam software to sift out the junk, we while away many hours per annum reading and deleting spam email that the software doesn't catch, and we pay for the bandwidth to download the garbage. All costs - the only thing is that these costs are not presented in one neat little invoice by one company at the end of the month, so it is difficult to focus our displeasure on something or someone that we actually know.

The recommendation by Obelix to introduce penalties sounds good and is in fact already in practice to some extent through WASPA, but this costs money too (on top of revenue gained from fines) and no matter what we may think, this money has to come from somewhere and it also comes from us via our cellular bills.

The monitoring and fining approach has it's shortcomings. What happens when you have a business like an online casino based outside of South Africa who send SMS marketing messages through a low cost service provider also outside of South Africa. Dishing out fines to these senders may be possible, but finding the senders and getting them to pay the fines is pretty much impossible. At least if there were interconnect fees, there is less incentive to spam.

So the question is really, "How would you like to pay for your communications?" and the options are, "on a sender/initiator pays basis", or "on a receiver pays basis"?

Personally, I like the sender/initiator to pay for my communications. In short, I know that the more the communication costs, the more likely the sender thought about it before sending it to me, and therefore the more likely it is to be of value to me.

Your whole argument seems to hinge on the idea that we are paying a fair price for SMS's at the moment and that that price reflects the true cost of communication (possibly with a fair profit added on, which I would have no problem with).

When you consider that an SMS is data and there are what... 160 characters in an SMS and it uses 7bit encoding system (correct me if I am wrong, but this is what I have read before, my knowledge on SMS's is sketchy at best) then you are actually transferring 160x7 bits per SMS.

160x7=1120bits

So we pay 80c (or whatever it costs these days to send an SMS) to transfer a mere 1120bits?

Seems like a bit of a rip to me. The prices we pay for SMS's has nothing to do with "paying for a communication" as you have put it. If the fee paid by the consumer to send an SMS were based on the cost of providing the service with a fair profit I would agree with you, but currently I just can't.

Please if I am wrong someone let me know as I have always felt SMS's were a complete ripoff and if I am wrong I would welcome an argument that showed my feelings are unjustified.

 

[AnomalyNexus]

This is such a ludicrous farce. The MD of a company called BulkSMS shouldn't even open his mouth on this topic.

Instead of a universal interconnect rate perhaps it should be targeted at the problem...like these bulk sms operations with names like BulkSMS etc

SMS cost calc:
SMS = 200bytes (160 chars @ 7bit char map =140 bytes + say 60bytes control info)
Cost = R1
Therefore Cost per gigabyte: [B]~R5 million/gig[/B]

And this guy thinks its not high enough? Oh, wait, his BulkSMS business doesn't pay consumer rates.

SMS interconnect charge will go far in addressing the issues. It will also allow for healthy competition and innovation in the messaging market

I would be embarrassed to say something like that. Maybe he actually believes it.

The recommendation by Obelix to introduce penalties sounds good and is in fact already in practice to some extent through WASPA, but this costs money too (on top of revenue gained from fines) and no matter what we may think, this money has to come from somewhere

Maybe they can use some of the ludicrous cash the cell companies receive for SMSs (see calc above).

What happens when you have a business like an online casino based outside of South Africa who send SMS marketing messages through a low cost service provider also outside of South Africa. Dishing out fines to these senders may be possible, but finding the senders and getting them to pay the fines is pretty much impossible. At least if there were interconnect fees, there is less incentive to spam.

You're just repeating the argument from the article. Eliminate these bulk SMS services that facilitate spamming.

So the question is really, "How would you like to pay for your communications?" and the options are, "on a sender/initiator pays basis", or "on a receiver pays basis"?

Huh? The sender is already paying more than enough for both of them.

 

[ProSMS]

crediting the termination fee to the receiver

How about a termination fee which gets credited to the receiver of the sms. That way I'll receive VODACOM23's with a smile all day long

This has been introduced by one operator in Italy. This benefits the consumer at the expense of the operator. The operator does benefit by attracting more subscribers from rival networks.

It did however have one major unintended consequence. Subscribers realised they could top up their airtime by going to any international website providing free operational SMS's. Some even wrote script that targeted big websites such as the BBC website, bombarding their own phones with thousands of SMS's, and then transferring and selling the airtime to other phones. This all sounds very funny, unless your own website was abused in this way. Even "forget password" sms services on websites were exploited.