Blog Post

ESPN Balks at Sprint’s New Text Fee

Sprint (s s) has quietly raised its messaging rates for companies that distribute texts, leading ESPN (s dis) and other content providers to stop delivering free messages to the carrier’s subscribers.

Beginning April 1, Sprint began charging an additional toll of one-half of one cent to companies that distribute texts on behalf of organizations for every message sent through its network. While the charge may seem minimal, it could dramatically change the economics for news outlets, retailers, banks and countless others who send texts as a free customer service rather than a way to generate revenue directly.

The carrier made no public announcement about the new charge, but discussed ESPN’s move last week in this company blog post. Others who have reportedly stopped sending text alerts to Sprint users include The Weather Channel and MSNBC (s cmcsa) (s ge). When I asked Sprint to comment, spokeswoman Jennifer Walsh Kiefer said the toll is necessary to keep pace with the increasing traffic of business-to-consumer texts:

“When the business model was originally created that enabled businesses to send texts to consumers without paying a fee, there was no charge because carriers were trying to encourage businesses to adopt texting as a way to reach consumers,” Kiefer said via email. “Today, with the dramatically rising use of texting by businesses, Sprint needs to recoup the cost for providing this capability.”

Of course, that neglects the fact that Sprint subscribers are already paying to both send and receive text messages. Sprint offers three plans that include unlimited messaging on its network as well as three a la carte messaging packages that can be added to other plans. Customers who choose not to buy bundled plans are charged 20 cents per message. And it’s worth noting that the cost of delivering text messages over the network is far lower than sending pictures or other kinds of content.

Sprint’s move isn’t unprecedented, however. Verizon Wireless(s vz) in 2008 suddenly announced a ridiculous charge of three cents per message for business-to-consumer texts. The carrier aborted the plan after content providers were outraged. That kind of response hasn’t surfaced in the wake of Sprint’s more modest new charge, though, which means the fee is likely to stick — unless customers demand the carrier deliver those free score updates from ESPN.

Image courtesy Flickr user Aaron Escobar.

4 Responses to “ESPN Balks at Sprint’s New Text Fee”

  1. Kelly F.

    If Sprint were really about recouping costs, then they would apply this fee agnostically across all content providers, but they have exempted the two largest senders of SMS: Facebook and Twitter. Why? Presumably b/c the fee would force FB & Twitter also to cease messaging to Sprint customers, and THAT would get more negative coverage, more consumers would notice/make a fuss, etc. They are simply scamming the smaller guys and seeing what they can get away with by getting paid at both ends.

    • Bill Esquire

      Exactly! Sprint continues to use the excuse that texting traffic is higher and therefore they need to recoup costs, but of course they are not charging the big 3 (Facebook, Twitter and Google) that are most responsible for the higher traffic. I am a Sprint user for now, but will be sure to move over to Verizon or AT&T after my contract expires. I encourage other Sprint subscribers to do the same, it’s the only protest we have that will get this policy changed.

    • Colin Gibbs

      The cost to send these messages can vary dramatically, Michael. Big distributors who buy in bulk can pay a fraction of a cent per message, while smaller guys may pay a few cents each.