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The Minefield Of Mobile Contracts
DOUBLE DATA”, “FREE HANDSET”, “UPGRADE ANYTIME”, “UPGRADE EARLY”. How do you know if the mobile contract you see or the one you are sold is the right one for you and the best deal?
Most people look at contract options as ‘what am I getting?’. Try asking ‘what do I actually need?’
Signing a contract shouldn’t be a two-year prison sentence!
Here are some basic facts and secrets about how the mobile market works and how you should approach your next renewal:
No device is ‘free’. You generally pay for the device over the term of the contract in addition to the airtime cost. Recent announcements from Ofcom have advised turning to ‘split contracts’ which list the handset and airtime pricing separately. The cost of the handset is basically split over 24 months. If you sign a 24 month agreement, ensure you don’t pay for your handset amount at month 25.
Carriers are looking for ARPU. This stands for ‘Average Revenue Per User’. The contracts they want you to sign with the newest, most expensive devices and large data bundles increase their turnover, market share and valuation.
Dealers and resellers (such as Eden) receive a fee for each contract from the carriers. This fee is generally used to fund the kit on a contract. Dealing direct with a carrier can limit the options you have to ‘spend’ this fund. Often, you will only be offered a couple of handsets to choose from. Partnering with a dealer can open up many options such as cash back, new handsets, refurbished handsets and call-off kit fund.
Data – how much data do you actually need? An airtime bundle with a large data bundle may sound appealing, but do you need it? Large data costs money! It WILL raise the monthly contract price. Ask for your recent data usage before signing up. A recent survey found that the average amount of Mobile data included with a Mobile plan is 5.9GB and yet subscribers only consume an average of 2.5GB, which suggests that some could save money by choosing a cheaper tariff.)
What does all this mean though? Getting a full review of your current contracts and latest bills can be really eye-opening. Generally, the usage (especially data consumption) is a lot lower than you would think.
Finding the best options for you isn’t rocket science. It is basically a matter of putting together a few main factors and building the contract up from scratch to meet your needs.
This is what Eden advise:
Always review your latest bills. Needs and usage change. Commercial contract opportunities should receive a tariff check, which can provide a calculated report to determine specific requirements.
Consider Shared Data for your business (or even your family!). For example, having 20 users with 3GB of data does not equal 60GB of usable data. Well, OK, it technically does, but what are the chances of all 20 users hitting exactly 3GB of usage? Consider this contract with 40GB or 50GB of shared data. This vastly reduces the chance of overspend, or ‘bill shock’. If one user goes over the 3GB they would have had, there won’t be any additional costs.
What devices do you need? Instead of looking at what devices you are being offered by the carrier/dealer, what are your exact requirements? Do you actually need devices? Would refurbished devices work for our organisation?
Have you had any overspend on your account? Additional charges such as data overspend, overseas calls, multimedia messaging, can all be avoided with the correct advice and management of your account. Adding bolt-ons and alerts to your account is best practice.
AND FINALLY….. your account will need managing over the term of the contract. Analysis of your bills is key to keep your tariff in check. As mentioned earlier, usage and demands change. They are likely to change within the period of your contract.
Partnering with a trusted advisor or a dealer rather than a network directly should provide you with this service, along with added features, such as a dedicated Account Manager or a friendly Customer Service team that you will get to know. Turnaround times for requests are generally quicker.
Granted, you will probably be offered more kit fund from the networks, which can look very attractive at the beginning of your contract term, but beware of the monthly charges, lead times for queries, the time you will spend sitting on hold to speak to someone and the lack of warnings for overspend.
Mobile Contracts don't have to be complicated…. JUST ASK EDEN!
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