Excellent tip there, Stackfault! For the sake of broadening the horizons, though, I'm going to offer up some alternatives.
Technically speaking, the mustachian version of a tin can telephone for "texting" for kids would be a used (cheap), deactivated CDMA WiFi enabled Android phone like the Samsung M910 with the Google Voice app installed. 100% free text messaging while home or in a WiFi hotspot, free emergency 911 services out and about.
Alternatively if you don't want to limit to just WiFi, do the same sort of Android phone setup with Google Voice and
PlatinumTel as your carrier. Technically speaking, SMS text messages are just a thorough rip-off
when you know how much data they actually use (info half way down the post), so Google Voice for texting is obviously the way to go, and the absolutely cheapest to maintain per month cell service in the US is P'Tel at $3.33 a month, which gives you about 33MB of data to use. Even if you figure
at worst a 1kb overhead per text message with GV, $3 should still buy you well over 30,000 SMS text messages a month, and that's assuming zero WiFi access time. Added bonus? 5¢ a minute phone calls, half of T-Mo's per minute cost. In a way, it's a fantastic setup for kids as
they can afford it themselves, deal with overages, learn responsibility and budget accordingly. Not an "unlimited" setup, but if a kid is spending enough time plugged into a phone long enough to send over a thousand messages a day, well....
Finally, if parents are comfortable spending $15 a month for an unlimited texting plan and 10¢ a minute talk time and also have a propensity towards caution, the handsets are more expensive, but there's
Kajeet which provides not just a phone, but parental filtering software and the ability to lojack their kids. TMo is cheaper in comparison to this from a setup cost, but it's worth mentioning anyway for the filtering software as unmoderated interbutts can be a potentially scarring thing for the younger set.
Edit: One has to be careful of "unlimited" plans with cell carriers, too, as unlimited is never truly unlimited:
http://www.techdirt.com/articles/20090427/0239194664.shtmlGiven the world record for extreme SMS sending is around 182,000 in a month? Highlights the true costs of text messaging and helps put the P'tel+GV option in perspective. Even if you figure a full 1kb per message for GV overhead (which is quite high), you could probably set a world record for well under $18. No telling what Google might do to you if you tried that, though.
New edit, April 1st: The above SMS GV figures are based on pure napkin math solely off of a Blackberry and for the messages themselves. Possible apples and oranges situation with Android data usage. Reality probably won't work out quite this rosy at larger quantities. YMMV. Caveat emptor. Take my numbers with a grain of salt. Yadda yadda yadda.