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October 24, 2007

Putting a cap on Telstra

We thought we'd posted this a few months ago, but having just had an email from someone looking for it on the site, apparently not. So ... here we go:

It took some time for the Bleeding Edge family to realise we were being stalked by our mobile phone bills.

In the past, your columnist has avoided monthly financial disasters, possibly because, being required to answer so many calls from people calling in, we don’t often have the time to dial out.

In January, for instance, our Telstra MobileNet bill was just $31.81. We had made only 29 paid calls, for a total of $20.25. (On the monthly business group plan we share with the Bleeding Edge spouse, the other 35 calls we had made to her mobile were free). The bill was padded out by one SMS message, 29 forwarded calls, and one call to MessageBank.

Our usage disguised the poor value that Telstra’s Mobile Business Group packages generally represent, even allowing us to contribute the admittedly tiny balance of our monthly call allowance to the Bleeding Edge spouse, whose profession demands a good deal more talking and texting. What with call transfers and MessageBank, her $70 business package has never been quite enough.

In January, her total bill reached $117.63, prompting us to talk to MobileNet about a more economical plan. Our thoughtful Telstra consultant suggested her calling pattern indicated she’d get better value from Telstra’s Business 80 plan.

Bleeding Edge was possibly lulled into a false sense of security, because in February our bill shot up to $60.82, after we dropped $40.86 on 42 calls. We’d also splurged on SMS texting, firing off 56 messages worth $12.73. That month, the spouse’s bill seemed to be on the way down, with her share of the joint bill coming in at $90.36.

At that point, things got completely out of hand. In March, Bleeding Edge spent $66.90 on idle chat, which seemed absurdly restrained, compared to the bill that arrived for our marital partner: $266.55 … more than double the January charge, and roughly 300 per cent up on the previous month.

In April, while our paid calls returned to a more normal 34 at $22.53, for a total of $31.35, our life’s companion had spent another $199.98. In May she was on her way to a new record. In just 25 days her bill had reached $229.13.

That was when we had another chat to a friendly Telstra consultant, and discovered the existence of capped plans. We suspect a lot of Telstra MobileNet users are similarly ignorant of the existence of what we regard as financial rescue packages, because … well … we Telstra MobileNet users tend to be financial innocents who regard it as our duty to keep those constantly complaining Telstra shareholders happy about their investment.

Optus users, Vodafone users, Virgin users, and most particularly 3 users, have been happily enjoying the benefits of capping for several years. They understand that capped plans charge a flat monthly fee – generally from around $29 to $70, but for particularly talkative people as much as $149 and even $179 – for a “bucket” of call credits.

On a $30 plan, for instance, you might obtain $300 worth of calls. The trick is to know how many cents you’re paying for those precious seconds, and whether some services – SMS messaging for instance – attract an extra charge. Provided you stay below the nominated limit, you can save a lot of money. Unfortunately, as a lot of complaints to the Telecommunications Industry Ombudsman indicate, you can also end up paying a lot more than you expected. In one case, for instance, a woman on a $30 plan which offered $300 worth of calls was presented with a monthly bill for $850. She ended up paying half that, when the ombudsman ordered her to split the difference with the telco.

As with most of its services, Telstra’s capped plans tend to be less generous than those of its competitors. It maintains our loyalty only because its geographical coverage is vastly better.

But after months of sticker shock, we’re being particularly careful with the spouse’s new $79 monthly capped plan, which supposedly delivers $550 of value. We know that Telstra has an ingenious currency converter which can make $550 worth substantially less than on 3, for instance.

Specifically, the fact that the Telstra cap bills in 30-second increments makes it less economical than plans which charge in per-second increments. And the 35c flag fall and call rate of 30c per 30 seconds will quickly mount up if we exceed the cap.

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