Opinion: Thanks to recent changes to phone plans by both Optus and Vodafone, Telstra is now using comparably outdated plan constructs. The smaller telcos have adopted several new plan features designed to make plans fairer and easier to understand -- features that Telstra either lacks or fails to adequately compete with on price.
The most striking change is the abolition of per-MB excess data charges, which are a common blight of the unsuspecting user and can cost you hundreds of dollars for a month’s use.
Admittedly, Telstra has recently dropped its rate for excess data significantly, which means you’re now unlikely to be stung by an unexpected four-digit bill. This change is good to see, but it’s still not as far as its two biggest competitors have gone.
No more overage!
Optus was the first to act in June, eliminating bill-shock from its plans by including unlimited calls in all post-paid plans from $45 up on the back of data protections introduced last year.
Optus includes an auto-upgrade system whereby users that go over their monthly data limit will not receive any per-MB overage fees. Instead, you are charged $10 and another whole 1GB is added to your plan until the end of the month. Vodafone did the same, also charging only $10 for each 1GB block beyond your monthly cap.
Vodafone followed suit with its own auto-upgrade feature earlier this year.
Multiple warnings are given to you before you reach your cap, and you are notified of the $10 charge once the additional data block has been added.
This may still strike you as an ‘overuse fee’, but over 3x less than the $0.03 per MB that Telstra charges. $0.03 per MB works out to a bit over $30 per 1GB. That’s not a wallet-crushing rate, but it’s certainly heavier than the competition.
Unlimited calls
Most Optus plans, and all Vodafone Red Plans, now offer unlimited calls within Australia. This is in opposition to Telstra, which only offers unlimited calls on its most expensive plan -- costing $130 per month.
It isn’t that Telstra subscribers are being stiffed by a lack of calls. Actually, most people never even get near their monthly call cap. You only need to worry about it if you’re on an uncommonly restrictive plan, or if you make significantly more calls than the average person.
The real problem is that each incremental bump in the amount of included calls helps to increase the perceived value of a higher-priced plan. That perceived value has a high likelihood of being meaningless to you once it's translated in to real-world use, because you mightn't even get near the call cap of the lowest-priced plan so you don't even need the upgrade.
Essentially what you’re doing is placing value on something that is inherently useless to you. You’re unlikely to even reach the monthly call limit on the lowest plan, so paying for anything more than that is pointless.
All you’re really paying for is more data. The extra call credit is pretty much just window dressing to make each successive plan look like it’s adding more value than it perhaps is.
On the other hand, if you are the kind of user that needs a large call cap then you'd still benefit from unlimited calls. If Optus and Vodafone can afford to provide them, you'd think Australia's largest telco could wing it, too.
Measure calls in minutes
What does “$500 calls per month” even mean? Not much, unless you’re willing to figure out per-minute charges and flagfall, then compare them against your average call length to find out a number of calls or minutes of calls you can spend on the phone each month (or use our search engine at WhistleOut, we do it automatically).
It’s an out-dated and confusing system that Optus has dropped and that Vodafone is in the process of ditching, displaying minute amounts for its long-distance call allowances on Red Plans.
This new standard is quite simple. Rather than making you figure out how many calls you can make, it tells you how many minutes you can spend on the phone. It isn’t perfect, but it’s far more transparent that than the old 'funny money' model, which is pretty meaningless as far as the average consumer is concerned.
Affordable data sharing between devices
This is one that Vodafone is behind on, but Optus has totally aced. On a My Plan Plus plan (say that five times quickly), you can access your already-paid-for data on up to five extra devices for a one-off $5 fee per device. Think of your data as being part of a pool. Each time one of your activated devices need data it reaches in to the pool and uses some of it up.
To activate a device, you pay just $5 and a data SIM is sent out to you. That SIM can be placed in any device with a 3G/4G SIM slot and away you go. You can order a SIM any time you want without affecting your My Plan Plus contract. You never have to pay any further charges, which is fair enough because you’ve already paid for the data anyway.
On Telstra you can do something similar, but it’s a $10 per-month fee per device that is added to your contract. That works out to $240 for a single device over the life of a standard 2 year subscription. You can still move the SIM between devices, just like on Optus.
If you stop an extra device that’s too bad -- you still have to pay. You should have planned for that at the beginning of the contract.
Telstra has the method in place to provide data sharing, yet its prices for this specific service are confusingly high, especially considering that Optus does the same thing for 2% the price with no contractual obligations.
What Telstra is doing right
Telstra does have one very good thing going for it, albeit with a confusing name. Each of its plans has a 'Bonus Upgrade Option', which allows you to choose between adding either 500MB of data or $500 of call credit for free.
This isn't so much a bonus as it is a choice. It allows you to customise your plan more specifically to your needs. Obviously most people would opt for the extra data but, if you're a call-heavy user then you can go for the call credit.
Greater clarity would be achieved by Telstra prompting you to "Tailor your plan" or some such other call to action, but for all intents and purposes this is a great feature that is not offered by the other major telcos.
Alex Angove-Plumb
Digital Content Editor
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