It's a mobile nightmare - follow a plan to make the most

It's a mobile nightmre - Follow a plan to make the most of phone bills, by Josh Robertson
(Credit: The Courier-Mail)


Mobile Australia

After visiting stores, poring over pamphlets and trawling through websites, Mark and Michelle Limb can sum up their search for the right mobile phone plan in two words: "baffling ordeal".

The Bardon couple, who recently returned to Australia after half a decade living in cellular-savvy Japan, are confronting the prospect of becoming mobile phone users in this country.

There's a vast array of providers and packages to choose from but few clues as to which -- if any -- offer compelling value.

The reality behind the hype is that a lack of competition among telcos here is limiting real choices for consumers, says telecommunications analyst Paul Budde.
"If you analyse the packages, they're complicated, difficult to understand -- the small lettering and all that sort of stuff -- the underlying business model being that the telcos want to sell voice and they don't want to make things cheaper," Mr Budde says.

"They pay a lot of lip service but in reality the majority of people just pay 50 or 80 cents for a mobile call and 20 or 30 cents for a fixed call and the telcos love it."

However, Reg Robertson, spokesman for consumer website Phonechoice, insists that "it pays handsomely to be educated and informed".

Choosing the deal that suits you hinges most of all on knowing what your mobile call habits are -- how many calls, where, when and for how long.

It's the typical mobile user's burden -- depart from your monthly standard and you'll be punished for it.

The prepaid option at least lets customers know exactly how much money they'll spend over a given period.

Pay $100 a month (and no more) and you might get three hours and 20 minutes of local calls at 25 per minute (and no more).

The downside is the inconvenience and inflexibility, says Mr Limb.

Sometimes going to the shop to top up credit is the last thing on your mind; but then fail to use all your credit in the allocated time (usually no more than three months) and it's wasted.

Then there is the "cap", a slightly misleading term for this kind of phone deal.
True, a plan might allow you to make up to $300 worth of calls (charged at 40 per 30 seconds) and "cap" your bill at $49, but since you can make far fewer calls than that and still pay the same, a cap is better understood as a minimum monthly charge.

Make more calls than that, the cap comes off and you pay more.

Despite this, caps are increasingly popular, says Mr Robertson.

Mr Robertson says the market has now moved to "a kind of third generation of caps", with a higher included call spend at a slightly higher call rate.

A $49 cap which used to include $230 worth of calls at 35 per 30 seconds now offers $300 of credit at 40 cents per 30 seconds.

Translated, that's five hours and 28 minutes of local calls compared to six hours and 15 minutes, or an extra 47 minutes a month.

Mr Robertson says caps have meant that call rates "across the board have flattened".

Telstra, Optus and Vodaphone each charge 40 cents per 30 seconds on their $49 caps but provide $250, $280 and $300 worth of calls respectively.

On the same cap and the same rate, Dodo offers $400 of calls -- but $120 of this must be to other Dodo customers.

Conversely, you could lock yourself into a $249 monthly contract with iSim, worth nearly $6000 over two years, and pay 18 cents per 30 seconds for 11-and-a-half-hours' talk time a month.

One drawback with a cap is that customers usually won't receive an itemised bill.
It's the inflexibility that bothers Mr Limb.

"I don't want to spend $70 a month if I only make $35 worth of calls," he says.
Mr Limb resents the idea of having to calculate and stick to a standard month of mobile use.

"I don't know what I'm doing week to week if I sign up for a two-year contract, I don't know what I'll be doing in two years' time."

In the end, it's the Slimtel VIP month-to-month plan that appeals most to Mr Limb -- a call rate of 11 per 30 seconds, no cap, no minimum monthly charge, no long-term contract.

Getting the most out of a mobile plan comes down to this: you have to know your usage patterns or mould them to fit your plan. The alternatives are an exorbitant bill or wasted credit.