Twitter Stops SMS to UK saysCarrier Cost Too High

imageTwitter has stopped sending out tweets via SMS in the UK, claiming the popularity of the service has made the cost too prohibitive without carriers reducing costs it has to pay. Without Twitter actually having figured out a business model yet, it was always destined to be this way.

Last night co-founder Biz Stone explained: ”When you send one message to Twitter and we send it to 10 followers, you aren’t charged ten times - that’s because we’ve been footing the bill. When we launched our free SMS service to the world, we set the clock ticking. As the service grew in popularity, so too would the price.” Seems obvious really.

Stone said he had managed to strike relationships in the US, Canada and India that absolved it of the necessity to pass on SMS carrier fees to customers; just not anywhere else. Twitter first got spooked about the problem when it capped UK SMSes at 250 per week in November, but the site has raised $15 million VC since then, taking it up to $20 million. If that money isn’t going in to carrier fees, where exactly is it going?

It’s the latest part of the Twitter service to bite the dust, after the instant messenger link was recently shut off. This is a particular blow because Twitter is said to be most popular, proportionally, in the UK. So it’s clear Twitter has to start making money somehow soon.

“It pains us to take this measure,” Stone said. “Even with a limit of 250 messages received per week, it could cost Twitter about $1,000 per user, per year to send SMS outside of Canada, India, or the US. It makes more sense for us to establish fair billing arrangements with mobile operators than it does to pass these high fees on to our users.” Instead, users have been told to use mobile web or mobile widget versions. British Twitterati have formed a Facebook group to lobby for carriers to “cut Twitter a decent deal”.

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