An Engineer

I am in France this week vacationing with family. I tried the new Skype app to make phone calls back to the US from my iPhone. Works very well. The Skype app is restricted to WiFi only. Want to know why? Just do the math.

I pay $30/month in the US for my unlimited data plan, and use about 160 megabytes per month. That comes out to $0.19/megabyte. Meanwhile, I also have a voice plan. My wife and I use a family plan. We have 2100 minutes and last month used 992 of those minutes, for which we paid $100. Assuming that a voice call over GSM uses approximately 10 kilobits/second, that is $1.34/megabyte we are paying to use the voice network, more than 7x as much.

ATT would rather sell access to their voice network at $1.34/megabyte versus their data network at $0.19/megabyte. And that is why the wireless carriers will not allow skype to use their data network. They don’t want to move people from voice to data.

If you look at SMS text and international rates, the situation only becomes more glaring. ATT charges $1.19/minute to make a voice call back to the US from France. That comes out to $15.87/megabyte. At that rate, I waited and made calls over skype using Wifi.

Text is even worse. Last month I had a 200 msg text plan for $5. That works out to $178/megabyte, assuming no breakage and full 140 character messages. But, I only used 47 of my messages, so I paid $759/megabyte. Ouch.

Of course, the wireless carriers won’t be able to continue getting so much more for their voice, text and international voice services compared to their data services. All are essentially the same service and over the long run, we will wind up paying the lower price of $0.19/megabyte. Nature finds a way. Just like I found a way to use Skype to make phone calls from France versus pay $15.87/megabyte to make a roaming international calls, so will everybody else. Because data is data.