relative profitability of SMS service?

Archived from groups: alt.cellular.tech, sci.econ (More info?)

Do you mean like a news SMS service, in which customers pay per txt
sent to them?

Archived from groups: alt.cellular.tech,sci.econ (More info?)

"Al Klein" <CellPhones@optonline.net> wrote in message
news:t0hcr0dar1pnheiske9o5pcg6j1vkgkrkt@4ax.com...
> On 4 Dec 2004 08:46:34 -0800, alanh_27@yahoo.com (Alan Horowitz) said
> in alt.cellular.tech:
>
> >if one could start a SMS-only network, would the return-on-investment
> >be better than voice service?
>
> If one starts a new cellphone network, one would have to invest
> billions. ROI would be nil for at least the first few years.
>

Not that it is profitable but a 2-way pager is close to a SMS only device in
use.
I've used one all over the US and parts of Canada.
Coverage is good and 1-way coverage is better than 2-way.
The Blackberry device is very popular with some people, but I think Research
In Motion not the service provider is making most of the money.


> >In existing American cellular networks, is there appreciable amounts
> >of unused SMS capacity. Could that capacity (as against voice
> >capacity) be increased by "tuning"?
>
> No, "SMS capacity" is the same as "voice capacity". They're all just
> data packets.
> ---
> CellPhonesEtc at optonline dot net

Capacity is not an issue as unlike voice a message can be delayed till
capacity is there.
Also one message would use only a few seconds of air time.

The problem as I see it is the extra effort to compose a message vs a phone
call, if your device has a limited keypad then the difference is greater.
The ability to send the same message to a group of people would be one
advantage of messaging.
Sending messages where phone calls are expensive such as other countries is
another advantage.
It is also nice to send a message vs a phone call when the other party is
sleeping.

Overall I would not expect an SMS only network to be profitable. It is not a
surething that cell phone companies will be profitable.