Facebook plans to break up SMS cartel

If you are bugged by the fact that most of your phone bill is sending texts to people, it seems that Facebook is planning to liberate you from your oppressive telcos and bring about a regime change.

At the moment the price of an SMS is effectively decided by the telcos who make an absolute fortune off it. Currently the telcos charge $1,000 or so per megabyte for SMSs.

When the EU intervened and told them they had to stop charging so much for overseas texts they screamed blue murder.

Facebook has just bought an outfit called Beluga which could change the whole game plan.

If you use the mobile phone industry’s peculiar pricing system, downloading data to your smartphone is amazingly cheap.

Beluga created an app for your smartphone which means you can send texts to groups of people at no cost.

With Facebook running Beluga, it puts the social notworking site in direct competition with the US carriers who might find it difficult to justify their 15 – 20 cent per text price..

This will be a kick in the nadgers to the likes of Verizon which gets five percent of its revenues from texts.

It was only a matter of time before the US government investigated the way that the telcos had the same prices for texts. The carriers have insisted that their identical price hikes were not co-ordinated but were a by-product of a competitive market. Which is odd because we thought compeition was supposed to bring costs down.

Still they can point to the cost of SMS in Europe being the same as the US and there is no competition there either.

With Facebook’s move the anti-trust argument moot. The telcos are about to have the goose which laid the golden egg well and truly cooked for them.