VZW to raise fees on messaging aggregators

Nelson said that Verizon Wireless has not increased per-message fees charged to aggregators since its SMS service launched in 2003, when the market for text alerts and SMS marketing campaigns was tiny. Since then it has turned into a huge market, Nelson said, requiring Verizon Wireless to explore ways of recouping the costs of directing billions of messages over its SMS platforms. Nelson also stressed that any fees would only affect traffic from for-profit services--non-profits, charities and public service agencies would be exempt. The fees themselves would also not be assessed to the content providers but the aggregators that sit between Verizon and the content suppliers, Nelson said.

Even if the aggregators were charged and not their content customers, they’d likely have to pass those fees onto those customers. Aggregators like mBlox process millions of transactions a month. A charge, even one much lower than 3 cents a message, would add substantial delivery costs to any message directed to a VZW customer.

The question now is whether other operators will follow Verizon’s lead in raising SMS delivery fees or try to differentiate themselves by leaving fees low. Regardless, there is little likelihood that content providers could choose to cut VZW customers off from their services. SMS-search providers like Google and Cha Cha, information alert providers from banks to the airline to news update services like Yahoo’s are building nationwide carrier-independent mobile platforms. Cutting off an operator that serves close to one third of the nation’s wireless customers would severely limit the scope of their applications.