Australian mobile carriers have rejected newspaper claims that customers are paying the “highest prices in the world for text messages”.

 The AMTA members said most consumers were paying a lot less than the nominal price of 25 cents a text as claimed by the critics, including Allan Asher, chief executive of the Australian Communications Consumer Action Network, a new consumer body established by Federal Communications Minister Stephen Conroy.

Mr Asher claimed that consumers were being “abused” by the text messaging “rort”.

" The mobile service providers are pricing texts at a vast profit margin and, sadly, it shows just how far from the competitive world market Australia is. We are being abused by the Australian telcos,” he said.

''Our service is among the worst in the world and our prices are among the highest. We are being taken for a ride by an industry that just doesn't care."

However, Senator Conroy rejected the claim that Australia had an uncompetitive market. A spokesperson for Senator Conroy said: ''There is competition in the mobile phone market. Companies offer a range of different services. It is important that consumers shop around for the best deal.'

Australians are expected to send 20 billion texts this year, more than 20 per cent higher than last year.

According to research done for The Sun-Herald, that is more than 10 times what it costs in many parts of Asia and almost a third higher than in Europe and Canada.

While the cost of mobile phone calls has declined in the past five years, the standard flat rate for a text message at Telstra and Optus has remained unchanged at 25 cents. At Vodafone, a text is 28 cents.

Last financial year, total mobile telecommunications revenue increased by 10 per cent from $10.8 billion to $12 billion, while mobile phone subscriptions increased to 24 million.

Vodafone Australia spokesman Greg Spears said the company's $49 cap plan, for example, provided customers with $350 credit a month.

   ''If a customer used their entire $350 worth of credit exclusively for texts, that customer could send 1250 texts per month - so each text has actually cost less than 4 cents.''

However, Mr Spears conceded there was a need to be more transparent about costs to customers in the cap plans.

An Optus spokeswoman pointed to the Australian Communications and Media Authority Communications 2008-09 report, stating the average revenue generated per text message sent in Australia had declined, from 9.1 cents the previous year to 8.6 cents.

She also pointed to the range of Optus SMS packages such as one whereby customers could send 500 texts for $10 a month, which reduced the price of messages to 2 cents.

An AMTA spokesman said figures contained in the latest report by the Australian Communications and Media Authority (ACMA) showed the prices of SMS/MMS in Australia fell by 4.7% in 2008-09

 “Furthermore, the report says that the price reduction stimulated greater consumer demand for SMS services; this generated more revenue for the industry,” he said. “The report makes it clear that the increased revenue was the result of greater consumer demand stimulated by price falls.

In fact, the ACMA figures show the industry revenue per SMS/MMS actually fell, which suggests that the price reductions had a greater impact on industry margins than increased demand from lower prices.”

Consumer monitor Choice spokesman Christopher Zinn said the price of text messages would not come down until there was ''a proper competitive market with transparent pricing''.

Robin Braun, professor of Telecommunications Engineering at the University of Technology, Sydney, said that texts were a ''huge money spinner''.

The cost of texting on the GSM (2G) system was effectively free for the telecommunications companies, as they piggybacked on the management channel used for the operation of the network.

Texting was a cost for the 3G system but it was ''minuscule'', Professor Braun said.

The 25 cent cost of a text, for 160 bytes, means Optus and Telstra effectively charge $1560 per megabyte. If comparing with a $30 internet plan with a download limit of 10 gigabytes, the charge per megabyte is 0.3 cents, including free email.

There are several online companies in Australia offering cheap packages of text messages, often used by marketing companies. One Australian company, SMS Tech, resells bulk text packages for between 5 and 8 cents a text.

SMS Global resells text services at between 5 and 10 cents a message - for both local and international texts. The standard price for an international text at the major mobile services providers is 50 cents.

SMS Global director of marketing Paul McKenna said: "We came into the market with a belief that everyone is paying too much for SMS."