Analysis: US text messaging is way up, despite higher pricing

Voice calls by US wireless subscribers are getting shorter this year, but Americans are spending more of their time texting, playing games, and browsing the Web on their cell phones, according to a wireless industry group.

Although average local cell phone bills will drop to $48.54 per month this year, US wireless carriers will rake in nearly $144 billion in yearly service revenues, with about 20 percent of this total going for data services such as text messaging, games, Web browsing, and ringtones. This according to a new survey from the CTIA industry association.

"Well, it's obvious we're still talking on our cell phones a lot, but there's been [a] huge increase in data. Carrier revenue was nearly $15 billion for the first half of 2008 in data alone," said Steve Largent, the CTIA's president and CTO, and former US congressman.


Although Americans are also starting to use their phones more to download music and watch videos on the Web, for instance, wireless carriers are reaping particularly large rewards from the use of SMS for texting and MMS for sending pictures and multimedia messages from phones, according to Largent.

For the month of June 2008 only, wireless carriers' reports show a total of 75 billion text messages, a gain of 160% over the 28.8 billion texts reported for June 2007.

"There were more texts sent and received during first half of this year than in all of 2007," Largent contended during an online video presentation. Much the same holds true, too, for MMS, which amounted to 5.6 billion messages in the first six months of 2008 among US subscribers.

Yet while texting originally served as an economical alternative to voice calling, that isn't necessarily the case in the US any more, where pricing for text messages has doubled over the past two years.

After Sprint Nextel announced increased pricing of 20 cents per text message, other big carriers -- including Verizon Wireless, AT&T, and T-Mobile -- soon followed suit.

Also according to the current CTIA study, the average local monthly cell phone bill declined from $49.94 in June 2007 to $48.54 a year later -- and the average duration of a local cell phone call fell from 3.13 minutes to 2.43 minutes.

Meanwhile, total service revenues for US wireless carriers jumped from about $133 billion in 2007 to $144 billion for 2008.

The number of US wireless subscribers stepped up, too, from about 243 billion in June of 2007 to 263 billion one year later. In contrast, the CTIA counted a paltry 203,600 wireless subscribers way back in 1985.

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