Australian Unlimited Phone Plans
Around 70% of Australians now have Unlimited phone plans.
In this article we:
- Consider why Unlimited Plans have become so popular.
- Look at what defines an Unlimited plan.
- Outline the sort of things that are often excluded from your unlimited plan.
- Look at the all important data component of what you’re buying.
- Consider the phone plan entertainment options that are available to you.
- Show you the best way to minimize the costs of your plan.
- Finally, we consider the question of unlimited data in a phone plan.
Unlimited plans are now the most popular plan in Australia
We forget how quickly technology changes sometimes. Unlimited plans now being used by the majority of the Australian population. But this is actually quite are recent phenomenon. It was only 3 years ago, in 2015, that they became so prevalent. The avalanche was started by smaller phone companies offering unlimited voice and SMS but was soon followed by Telstra, Vodafone and the others. Now, almost every phone company offers unlimited plans in some form. Entry prices for this sort of plan have fallen to the sub $15 a month level.
As usual, there is a business case behind the evolution of the product. In some recent Australian research by the consulting firm Deloitte shows that use of phone company networks for traditional purposes ; to make voice calls or send SMSs is declining steadily. Already, as recently as 2016, only 70% of so of Australians made a voice call in the week preceding the survey. No wonder the phone companies are prepared to ‘give unlimited inclusions away’ when it is of such declining value to their customers.
From a consumer point of view, unlimited plans reflect the broader tide of Australian sentiment away from expensive and complicated towards cheap and manageable. The same rising expectations that gave us Netflix instead of Channel 10 and Spotify instead of waiting for our song to come on the radio have driven users to demand that phone calls be provided on their terms, not the terms phone companies prefer. Now, comparison of the phone plan you want rarely involves consideration of the cost of voice and SMS. As we will see below, the major feature to compare is the data that comes alongside the uncapped voice and text allocation you’ll get.
What are Unlimited plans?
In theory, an unlimited plan is one which gives you an unlimited allocation of at least one phone company service. By far the most common example is an unlimited voice and SMS plan where the unlimited voice and SMS components are for use in Australia only.
The usual format is that you pay a monthly fee and get:
- Unlimited talk time in Australia to Australian phone numbers:
Unlimited talk time when calling mobiles and landlines in Australia from a mobile Australian number.
- As many SMSs as you want :
Unlimited texts / SMS’s to send to any mobile number in Australia from your Australian phone number. Remember they used to be 25 cents each?
- An allowance for data :
The data you’ll get in your plan changes depending on your spend level and is not unlimited. You’ll see options for anything from 1GB to 15 GB and more per month. Data inclusions are a constant source of innovation in telco. You’ll find Unlimited plans with providers offering more data on the weekend , data rollover and even now, data banks.
- International calls :
Unlimited International Calls also become cheaper each year. Competition from Skype, Facetime, WhatsApp and other VoIP known in the industry as Over The Top (OTT) services mean the phone companies are having to lower their prices for unlimited calls. That means you’ll find them in many plans $40 or above. The price of unlimited calls is falling every year, too. The alternative is that you will substitute these free versions of the same service.
Unfortunately, not everything in your phone plan is unlimited just yet
The marketing of the phone plans you’re offered are watched by the ACCC and Telecommunications Ombudsman (among others) to ensure you’re not being taken advantage of. These overseeing bodies, which pay such close attention to the claims made by phone companies, have been extremely clear about the word ‘unlimited’ for some time. In the past, unlimited plans were sold which secretly had limits hidden in the small print. That’s a no no for the overseers.
I have worked in phone company teams, where we have discussed for many hours, whether or not we should use the word ‘unlimited’. Since this phone company was taken to court for employing the word ‘unlimited’ in a ‘misleading’ way, the regulator has been explicit about when phone companies can and can’t say it as part of their marketing materials. These days, If they tell you it’s unlimited, it must be that. No if, buts or ands – it has to be unlimited.
That said, there is always small print. There are plenty of other considerations when hunting out the best Unlimited plan. Even with this regulator guidance, the following items can incur extra charges. These exclusions are typically outside the definition of ‘unlimited’.
Why would I want an Unlimited plan?
Why do 70%+ of Australians choose unlimited phone plans ?
- They get a predictable costs :
In this sort of plan, calls and texts are unlimited. That means no busting through an allowance and being charged for overage. The result is no bill shock. Even if a plan with unlimited calls costs a little more, most people are happy to pay it for the predictability is gives.
- No contract required :
You can get SIM only Unlimited plans on a month to month basis so there is no need to commit to an expensive 12 or 24 month contract. We generally recommend away from contracts of any sort. We explain why, below.
- Prepay and postpaid options:
There are post-paid and pre-paid options for unlimited plans so however you want to pay, you can find one to suit you. If cost manageability is the key thing you need, you might also like to include prepaid unlimited plans which have an extra degree of cost control.
- Budget options are available:
This sort of plan is now extremely affordable. Shop around the budget deals and you can get amazing deals from phone companies with unlimited plans for under $15 per month.
Getting the right amount of data in your Unltd. Plan
When you can talk and text as much as you want, the key thing left to talk about is the amount of data you have in your plan. Below is some research we ran in September 2017 in which we asked people how much data they needed.
What should you take from that chart ?
- First, there is a broad distribution of the plans people are buying :
It’s worth being aware that now the cost of calls is off the table, the cost of data makes all the difference to what you’ll pay for your plan. Our suggestion is that you don’t listen to those who try to tell you what average usage looks like (because it doesn’t matter what ‘average’ is, your data usage could match any of the data usage profiles in the chart above – it could be average or it could be well above / below average.) Follow our advice, below, to establish your own data usage requirement.
- Second, only 20% of people have a bundle with 11GB or more :
There is an amount of ‘dog whistling’ in the phone industry – misleading marketing and offers which create a false impression. Just because you see a phone plan with ‘45GB of data per month included’ (they are around!) does not mean you would use all of that data if you were given it. Of course, there are always extremes, people who tether their phone and who might have a legitimate need for such a huge allocation. However, for the vast majority of people, 11GB of less is probably fine for now.
- If you need help figuring out how much data you need :
Most people don’t know how much data they use, how much they need or how to figure it out. We have an article dedicated to establishing what your need is.
- And something which isn’t on the chart :
The 4G coverage of the different networks is now pretty much the same. That’s a significant piece of information. If you were planning on going to one of the big phone companies to get better 4G data coverage, for example, you may not need to. The best way to find out more about the equivalency that’s happened in data networks is to read our Australian coverage page.
Entertainment in Unlimited plans + Data Free / zero rated data
That’s the basics covered. We’ve looked at unlimited plans, and data you need to add to them. Now let’s talk about the bolt ons; the optional extras which might influence your decision – most importantly, the entertainment options you now have in unlimited phone plans.
Around 10% of Australians want to watch entertainment (free streamed video or audio) on their phone plans. The only Australian plans which offer entertainment are unlimited plans.
There are a number of major options to consider in the world of entertainment in phone plans and we’ve written about them before. As a quick overview, some phone companies – usually – not always – the ones with the most expensive plans – now include some form of entertainment in their phone plans. The data for entertainment options on these plans is usually provided ‘free’ (see next section – it’s called ‘data free.’). Optus, Telstra and OVO Mobile are the main companies you should consider for entertainment in your plans.
Entertainment may well be the most important feature in your plan if you like the idea of watching a particular sort of content while you commute or wait at the doctor’s. Our plan chooser can help you figure out the right plan and allows you to select the type of entertainment you want, if it’s of interest.
What is ‘zero rated’ content in an unlimited plan?
We cover the lack of unlimited data plans below. For now, let’s look at the aspects of your unlimited voice and SMS plan which might be ‘data free or ‘zero rated.’
In a sense, ‘zero rated’ or ‘data free’ data is unlimited. However, it’s unlimited data which is restricted to one type of data usage. For example, with Telstra’s plans you’ll get unlimited voice and SMS (in Australia to Australian numbers) plus a standard data allocation. You can also watch as much AFL on your handset as you like, using their app. The data that is used during your AFL watching won’t be counted against your phone plan because it’s ‘data free’ or ‘zero rated’. Any other type of usage will be counted against the standard data inclusion in your plan.
Too complicated ? How about an example. Your Telstra plan has 5GB of data and, that month, you only do two things. First, you watch 30 hours of AFL. At the end of that, you still have 5GB of your standard bundle left. Next, you look at Facebook for hours on end. The data used by your Facebook feed counts against your 5Gb data allowance, running it down until it is used.
Data free is something to look out for if you like the content these phone companies are offering. You should be aware, however, that, unless you’re watching hours of TV or sport entertainment on your phone each month, it probably shouldn’t be the criterion on which you base your decision.
Ways to keep costs down in Unlimited Plans
Unlimited plans, as we’ve said, are now extremely affordable. There’s no point in wasting money, however. There are ways to keep any additional costs associated with your unlimited plan, under control.
- There are usually sign up bonuses : When it comes time to move plans, from the one you’re on to one of the others in market, see if you can get a signup bonus. Go for prepaid and move around.
- Avoid out of bundle data charging : 28% of people (see the chart below) have been charged $10 or more for data in the last month, on top of their core plan inclusions.
Data is extremely cheap these days. There really is no need to pay $10 penalty rates. Most phone companies will charge you $10 per GB for any data you use on top of your allocated data entitlement. It’s better than $11 / GB but you’ll be much better off if you spend that $10 before you use the data than after, as this chart shows.
Remember too that the way phone companies charge for data differs between them. Moose Mobile for example, charge per MB for ‘overage’ data on top of your monthly allocation. Some see this as a benefit because their users only pay for what they want. Most of the others charge $10 per GB, sold in GB chunks. You can find out the specifics of the plan you want by looking at the CIS – the Customer Information Statement on the website of the plan you choose.
Should you take out a contract on your unlimited plan ?
There are contract options on SIM Only Unlimited Plans. Telstra, for example, offer ( perhaps even prefer you to take ) both 12 and 24 month SIM Only contracts for their plans.
It would be foolish of us to suggest that you should never even consider these plans. They often include a great deal more data than you’ll get on the month to month option. More importantly, changing phone plans is a hassle that people rarely feel like attempting more than once a year. If you’re looking at your calendar and thinking that in all likelihood, you simply won’t have the time to compare and move plans in the next 12 months, well then you may as well take the contract option.
Just be aware of the fact that the cost of data is falling constantly and very quickly. And, as you can see here, there are often hidden costs for people who do take contract options.
In the example chart above, someone who signs up to a 2 year contract is fine for the first 12 months. Unfortunately, they don’t know their data usage is rising every month, a fact most people don’t realize. After about a year, they’ve started to nudge their usage allocation. Shortly thereafter, the user exceeds their allocated data bundle and starts to get hit with excess data fees, here we’ve used a data overage charge of $10 per GB. In total, their bill, with the average growth in monthly data, is $300 for excess usage over the course of the contract. And remember, when they signed up, they had an allocation which was twice what they needed!
If you want to sign a contract for data, that’s fine. Keep track of your usage and make sure you move up a plan to get more data if you need it, rather than paying for extra data.
When will get an unlimited data plan ?
We all know what unlimited plans should be. Nearly 40% of people say they want unlimited data included in their plan. There are no unlimited data plans available in Australia at this time although, historically, there have been times when you could get one.
The problem with unlimited data plans, from a phone company point of view, is that a small number of people misuse them. There are always a few people who hook their phone up to their laptop and torrent films 24 x 7. Interestingly, as the majority of us start using larger quantities of data, the prominence of this small number of users is diminishing – a factor which may be pushing us closer to the release of an unlimited data plan in Australia.
TPG will launch in Australia in early 2018. They will have built a metro network and will need to build a customer base quickly. As you can see from the above graph, the biggest customer need that phone companies are not delivering, is ‘unlimited data.’ When it comes to ‘fair data management’, the simplest way to articulate it is by offering unlimited data in a plan. The user never has to worry about it again.
In the USA, prices for plans with unlimited data start at $50 and go to $90 depending on where you are in your agreement with the phone company, and the quality of the network. There are restrictions on the plan which the Australian regulators may not allow. For example, tethering laptops, on some plans, excess data is 3G only. Data may be throttled (slowed down) at 32GB or above.
In fact, unlimited plans made up more than 2% of the American market to in 2016, 2 years after Unlimited data plans were re-released. They’re not nearly as popular as you’d think.
So, if you want unlimited data, in our view, you’re about to get it, when TPG launch in 2018. In reality, however, what the phone companies need to give most of us, is better data management tools which make their products fairer.
Summing it up
There’s never been a better time to get unlimited voice and SMS plans. They start at $15 or less these days. You will likely pay more for plans which have international calls and / or data free entertainment options included.
It won’t be long before we have unlimited data plans over here. If the experience of our American cousins is anything to go by, even when they’re available, they will service only the highest using proportion of people. For the rest of us, the key to managing the cost of your plan is, as always in knowing and managing your data usage.