Aggregation 101

Today I’ll be talking about aggregation, which is a facet of telecommunications plans that we frequently find people struggle with. Its advantages, which are great, are often misunderstood. 

Simply put, aggregation means that the benefits provided by a given plan – such as calling credit or a data allowance – is added to the benefits of the other plans on the same account. 

There are several types of aggregation, depending on what is actually being aggregated. 

Call Credit Aggregation

Let’s say you have three mobiles, each on a $40 plan, which provides $40 of monthly credit per service. Let’s say the three mobiles are making $55, $45 and $15 worth of calls each month, or $115 in total. 

Under non-aggregated plans, the monthly cost of these mobiles would be $55, $45, and $40, since a $40 plan has a minimum spend of $40. For an explanation of minimum spend, see here. The total monthly cost would therefore be $140 (55 + 45 + 40). The problem here is that the third user is only making $15 worth of calls, but is having to pay $40 because of the minimum spend on his plan. Meanwhile the first user ($55) has exceed their minimum spend by a handy amount.

However, if the plans were aggregated fleet plans, the three $40 plans would have their included call credit added together, for a total of $120 per month, which is also the minimum spend (3 x $40 plans). The three mobiles would still by making $115 of calls in total, but they would all draw from the aggregated call credit ($120). The total monthly cost would therefore be $120 (since this is still the minimum spend). You can look at it this way: the unused credit left over from the third mobile user ($25) is given to those who are using more than their share of credit.

In this example aggregation has saved $20, or about 14% per month. This kind of savings will scale up for larger fleets. Aggregation is never a bad thing. 

The ramifications of this is that the call spend of any given user becomes fairly irrelevant. All the really matters is how much all users are spending in total, and how this relates to the entire provided call credit. 

Our experience has shown that although any given user might fluctuate from month to month, large fleets of users tend to spend a similar amount over time, and that any change is gradual. There's a kind of inertia involved. Aggregation means that plans can be selected with more accuracy, and with more confidence since you know that any unused credit from some users will be used by others. 

Data Aggregation

I’ve shown that aggregation can provide decent benefits on calls, but where it really comes into its own is with mobile data, generating decent savings from month to month, and potentially saving thousands by lessening the chance of bill shock.

Data aggregation can work in a number of ways: on mobile phone plans, and on separate mobile data devices with their own plans. I’ll talk about phone plans first.

Some business fleet plans include a token mobile data component. This amount, generally between 50Mb and 500Mb, often isn’t really enough for any user who needs to use mobile data for business practices. However, it is entirely wasted for users that don’t use data on their phones at all. Under a standard non-aggregated model, the users who need data would have to get an additional data plan for their needs. Under aggregation, however, all of these little token amounts are added together to form a pool of available data, which can really add up. A fleet of 100 users might achieve a data pool of over 20Gb, which is a substantial amount.

Now, it may well be that some heavy users will still require additional data, but most now won’t. The pooled aggregated data will amply cover their needs. Overall, we have found that data aggregation will always deliver reasonable savings from a reduction in required data plans.

The most significant problem with mobile data occurs when users go over their data limit, or when a user who never otherwise uses mobile data suddenly discovers they can, without realising the costs involved. This invariably leads to thousands of dollars in excess data charges. Here at Dog and Bone we have seen this more often than we can remember. However, having an aggregated data pool, shared by every user, substantially slashes the chances of this blowout occurring. Aggregated data may well save your organisation a lot of money.