WASHINGTON, June 16 U.S. wireless carriers
Verizon Communications (VZ.N) and AT&T (T.N) took issue with
assertions that they colluded in setting prices for text
messages, saying on Tuesday that prices for most customers had
fallen and the market was competitive.
Sen. Herb Kohl, chair of the Senate Judiciary Committee's
antitrust subcommittee, said he was concerned that the four
largest cell phone companies doubled their text message rates
from 10 cents in 2006 to 20 cents in 2008.
"These sharp price increases raise concerns. Are these
price increases the result of a lack of competition in a highly
concentrated market?" he asked, adding that the subcommittee
had urged the Justice Department to scrutinize any future
mergers or allegations of anticompetitive practices in the
But the general counsels of both Verizon and AT&T argued
that the price increases affected 1 percent of text messages
sent because most consumers bought volume plans that lowered
the per-message cost.
"The faulty notion that prices for text messaging have
risen derives from an unduly narrow interest in the trend of a
single pricing option for text messaging services, the
pay-per-use option, when the vast majority of AT&T's customers
do not choose that option," said Wayne Watts, general counsel
Watts and Randal Milch, general counsel of Verizon
Communications, said that about 17 percent of their customers
were on a plan that had them paying for each text message.
They also each denied that their companies colluded on
"The market evidence shows fierce competition across the
wireless market," Milch said.
(Reporting by Diane Bartz)