Text Message Prices

Recently, the Antitrust, Competition Policy and Consumer Rights Subcommitee examined the state of competition in the cell phone industry.

Senator Kohl stated that “[f]rom 2006 to 2008, the price of sending and receiving a text message among the four largest cell phone carriers increased by 100% from 10 to 20 cents per message” even though “the cost to the phone companies to carry text messages is minimal, estimated to be less than a penny per message, and has not increased.”

Here’s the funny part. Verizon and AT&T argued that the price increases only affect a small percentage of subscribers because most people purchase a text message package instead of paying a la carte. Actually, the price increases affect all subscribers because if the carriers charged 2 cents instead of 20 cents per message, then most subscribers probably would not purchase a package. Or, in the alternative, text message packages would be significantly cheaper.

Legal Research

Using a Cell Phone While Driving in California

Just over three months ago, California started prohibiting the use of cell phones while driving. However, the law allowed drivers 18 and over to use a cell phone provided that they also used a hands-free device. So, I was quite surprised to see other drivers talking on cell phones these past few days. You can’t miss the unmistakeable sign: right hand glued to the right ear while driving. This morning, Palo Alto Online reported that the CHP had cited over 20,000 drivers for talking on a cell phone. Although the base fine is $20, the DMV states that “[w]ith the addition of penalty assessments, the fine can be more than triple the base fine amount.” In these times of financial crisis, we can thank our fellow drivers for chipping in an extra $400,000 – $1,200,000 to help out the state.