Unlimited Usage Plans: Are They Worth It?
By Rico, 10:10 am Thu Nov 20 2008 - Analysis - 5 Opinions
The point of a white paper received yesterday, written by the ITMC Institute, is clear:
The popular ‘Unlimited Call & Text’ plan as… marketed and implemented today by SUN Cellular is expensive and misleading, and is unfair and disadvantageous to the consumer… Given the actual calling habits of the average consumer, and the current state of service and support,… [these] plans are more a case of little value for more money, and consumers pay more for less.
It’s easy to characterize ITMC’s statement as an attack on SUN, but at least they back up their statements up with some hard data. I’m less convinced about one of their conclusions though.
Cellphone Usage Data
The white paper points out SUN’s “flagship service”—unlimited texts and calls for one day at P25—and proceeds to show why P25 a day may be too much:
the average mobile phone user only consumes a maximum of 214 minutes of calls per month. At standard calling rates, this would have a value of P214.00 of usage [or P7.14 of load/day]—yet the users pay P25/day, or 350% over [actual] needs… on a monthly basis, the user pays P750.00 for P214.00 worth of usage.
That depends on how much an “average mobile phone user” really pays for every minute. Don’t other providers charge more than a peso? Did the “P214.00 of usage” refer to Globe’s and Smart’s own unlimited promos? Lastly, does ITMC’s research on cellphone usage data even consider the cost of texting?
Service Provider Reliability Data
I find ITMC’s data on dropped calls more convincing. They were trying to point out that, even if anyone decided to maximize SUN’s P25/day scheme, the provider’s unreliable network would prevent them from doing so:
In a recent November 2008 survey by the NTC on telco usability, SUN Cellular was reported to have the highest drop call rate of 17.05% which was alarmingly far off from… competitors Globe Telecommunications (1.99% drop call rate) and SMART Telecommunications (3.79%) were reporting. [emphasis mine]
17.05% is very high, close to 1 out 6 calls dropped. Wow, I had no idea that SUN Cellular was that unreliable.
While it doesn’t seem likely to me that the Filipino’s average monthly cellphone usage only amounts to P214, I can’t help but hope that SUN works quickly to improve its network’s reliability. Forgot about coverage, let’s start with successfully connecting those calls first,
sultanjr
11:11 am Thu Nov 20 2008
I think the big problem with unlimited call/text plans is the call habits of some people which lead to network congestion and, thus, dropped or unconnected calls. One guy I know used to work around with his phone’s earpiece on, talking to his girlfriend the whole day. He wouldn’t even stop the call even when eating or talking to someone else. Another teenager I know also used to send text-spam to people in his contact list just because it was free. I realize the majority of users aren’t like this, but to what extent does abuse like this cause dropped calls and/or network congestion?
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Jason
2:02 pm Tue Nov 25 2008
Hey Rico,
Regarding the white paper that you mentioned:
Are there any disclaimers/disclosures of ties with other telcos? It seems that the timing for the publication of a white paper that somewhat deprecates Sun Cellular would be so opportune with the launch of Red Mobile, which positions itself against Sun Cellular.
I own a Red Mobile SIM myself, and was looking around the web for comparisons between unlimited usage plans and dirt-cheap tariff offers. I stumbled upon your article and found it interesting how the focus is specifically with Sun.
Hope you could share the white paper as well (or a link, perhaps?).
Thanks and more power to your site!
Rico
1:01 pm Thu Nov 27 2008
Hi Jason,
Lemme check first if I can share this paper. I’ll let you know as soon as possible.