Text messaging is as popular in the U.S. as it is expensive, giving birth to a somewhat strange tendency: as SMS prices increase, so does the number of messages sent. It may sound like a paradox, but it also sounds like a way for cell phone companies to make more money: people love sending SMS text messages, so they’re willing to pay more in order to do that.

However, cell phone companies will need to answer one big question: why have text message charges doubled over the past three years? In a letter sent to Verizon Wireless, AT&T, Sprint and T-Mobile by US Senator Herb Kohl (D-WI), chairman of the Senate Antitrust Subcommittee, the carriers are asked to justify the sharply rising rates.

According to the letter, experts in the field contend that the high rates cannot be justified by any increases in the costs associated with text messaging services, instead they reflect a decrease in competition, and an increase in market power, among the four companies mentioned earlier, which serve 90 percent of the nation’s wireless subscribers.

Reports have shown that over the past three years, the costs for sending or receiving a text message has increased by 100%. Kohl said in the letter that Sprint was the first to increase the prince of text messages from 10 to 20 cents last fall, a move soon followed by the other three carriers.

“What is particularly alarming about this industry-wide rate increase is that it does not appear to be justified by rising costs in delivering text messages,” Kohl wrote. “Also of concern is that it appears that each of the companies has changed the price for text messaging at nearly the same time, with identical price increases. This conduct is hardly consistent with the vigorous price competition we hope to see in a competitive marketplace.”

Kohl explained that as the level of consolidation in the wireless telephone industry has changed in recent years, the number of major competitor has reduced to 4. Furthermore, these carriers continue to acquire the smaller competitors, which raises questions on whether this consolidation, and increased market power by the major carriers, has contributed to the doubling of text messaging rates over the last three years.

The Senator demanded the four major carriers to justify the text messaging rates, by explaining the cost, technical or other factors that justify the 100% increase in the costs of text messaging between 2005 and 2008.

In addition to that, the carriers will also need to provide data on the utilization of text messaging between 2005 and 2008, as well as a comparison of prices charged for text messaging as compared to other services offered by them, such as prices per minute for voice dialing, prices for sending e-mails, and prices charged for data services such as internet access over wireless devices.

Furthermore, the carriers will also need to state whether their text messaging price structure differs in any significant respect from the pricing of the other three main competitors. The carriers are expected to send their responses by Monday, October 6, 2008.

According to a recent survey by CTIA, consumers spent $14.8 billion on wireless data services this year, 40 percent over last year’s figures in the same period. Furthermore, it appears that text messaging set new records in the first half of the year. In June alone, consumers sent a whopping 2.5 billion messages a day, 160% over June 2007.