To view Senator Herb Kohl’s press release, click here.
Federal authorities are questioning four major cell phone companies about rising text messaging prices.The Senate Antitrust Subcommittee is questioning AT&T, Verizon Wireless, Sprint and T-Mobile for their increase in text message prices from 10 cents per text message to 20 cents in the last three years. Sen. Herb Kohl, D-Wis., chairman of the Senate Antitrust Subcommittee, sent a letter Sept. 9 to the executives of the four companies expressing concern about the 100 percent markup of text messages. The price of individual text messages was 10 cents per message in 2005, and the companies increased to 20 cents per message last year. “These increased rates do not appear to be justified by any increases in the costs associated with text messaging,” Kohl’s letter read. “But may instead be a reflection of a decrease in competition, and an increase in market power.” The Antitrust Subcommittee deals with issues in competition with industries, Rohit Mahajan, Kohl’s press secretary, told The Daily Reveille. In this case, the committee is checking for price fixing.Mahajan said the committee is questioning the companies because it appears they are working together and unfairly charging consumers. “It’s coming at a time when texting is very predominant, and texting is supposed to be relatively inexpensive,” Mahajan said. The concern is the cell phone companies have doubled their rates for individual text messages during the last three years, Mahajan said. Deborah Lewis, Verizon Wireless spokeswoman, said Verizon will respond after the company evaluates the accusation. Emmy Anderson, communications manager for Sprint, said Sprint will respond to the senator’s letter and provide information on the company’s text messaging options. The letter said the companies must provide data by Oct. 6. The cost of text messaging is decreasing in Verizon’s phone plans, Lewis said. Verizon offers unlimited texting for $20 per month, and if a customer messages a lot, it amounts to only pennies per text, she said. Sue Sperry, AT&T Louisiana spokeswoman, said the company cannot disclose information about AT&T’s in-house cost of text messages because the market is too competitive. Hailey Branch, English junior, said she had no idea the price of individual text messages increased.Branch upgraded to AT&T’s unlimited text messaging plan when her bill got too high after going over her text messaging plan’s quota. Three of the four cell phone companies charge $20 per month for unlimited text messages if the consumer’s plan does not include the feature. T-Mobile charges customers $14.99 per month. Andrew DeMoss, economics junior, said he used to have the unlimited text messaging plan but downgraded to a smaller plan.”I didn’t have the money to pay for unlimited messages,” DeMoss said. Robert Hudson, international studies freshman, said he has unlimited texting because it came with his iPhone plan.If customer’s have good packages, then it is a good deal to have unlimited messaging, Hudson said.  Mahajan said Kohl received a lot of complaints about the price increase, and he thought it was necessary to investigate the problem. If the subcommittee is suspicious after the companies send their data, the subcommittee will report the companies to the Department of Justice for further investigation.—-Contact Joy Lukachick at [email protected]