As this doesn’t seem to have been reported, this will count as rumour.

Prior to the recent Red Nose Day, the mobile networks agreed to give 100% of the premium SMS for donations to the charity. Typically with PSMS, the networks take quite a large chunk for themselves – around 55% (but depends on the value). Some networks are also rather greedy and take 10p for texting in to the shortcode additional to any bundles or subscription tariffs.

PSMS also includes VAT, which in the case of charity donations isn’t technically correct. In the case of Red Nose Day the government generously agreed to give the VAT from the PSMS as well.

However, one mobile network operator, did not agree to give all of the money to Red Nose Day and intended to keep a considerable chunk of the money for themselves. It was only when Gordon Brown himself phone the operator that they agreed to hand over all the cash to the charity!

Through my own work, we run a number of charity donation campaigns. Both the VAT issue and the amount of money taken by the networks is a continued frustration. A working group has now been set up to deal with this, and to provide a ‘charity’ shortcode that will not attract VAT and provide a higher payout rate.

For more information on charity donations by SMS, please see txt4giving.com