Following the release of its first IT Strategy last week, the Victorian Government has announced that it will overhaul its lucrative Telecommunications Purchasing and Management Strategy (TPAMS). TPAMS is the framework whereby the government procures telecommunications and IT services and equipment from eligible providers.
Did you know that a great many pre-paid mobile phone plans have become considerably worse recently? You might not have, since it this change has come about in a pretty sneaky way.
Joining us tonight on Who Wants To Use The NBN? is our carry-over champion, Alan. Thanks to this broadband nirvana we now inhabit, Alan will be joining us via High Definition video link. Good evening, and welcome to the show.
We here at Dog and Bone have felt for some time that Optus has a clear identity issue.
This is perhaps ironic for a company that strives so very hard to push its particular brand, from the venerable ‘Yes’ campaign that won’t stay dead, to the unfathomable wild animal campaigns of last decade, to that lethally cute little lemon drop guy they have now. Perhaps it’s not ironic, and the rebranding perfect illustrates the issue.
Bill shock - the shock of receiving a massive and unexpected bill - is becoming increasingly common with mobiles phones, leading in many cases to severe financial hardship and even bankruptcy.
Here we look at some ways you can avoid big blowouts. Various financial counselling services have reported that mobile phone bills are the number one cause of people - especially young people - seeking bankruptcy guidance.
It seems that many people simply don’t understand how their mobile plans work, what their phones can do, and how much certain services cost. Ignorance is no longer bliss, if indeed it ever was. It’s also no excuse for phone companies, who expect to be paid no matter how bewildered you might feel.
So how can bill-shock be avoided? The two most vital things you can do are to know the products, and to be honest with yourself. Here are some general tips:
PREPAID IS ALWAYS THE SAFEST
With pre-pay, what you pay for is what you get, making it very easy to control your expenditure each month. This is an excellent option for people who aren’t sure where they’ll be in the future, and those with a bad credit rating. Even if your prepay credit is used up, you can still call emergency numbers.
CHOOSE YOUR CAP CAREFULLY
If you’re on a Cap plan, make sure it is big enough, and be careful not to exceed your limit. Cap plans are great value so long as you stay within your cap. However, call rates on Cap plans are truly terrible, and costs can really add up if you use up your available credit.
BE CAREFUL WITH SMS
SMS may seem cheap - only 20- 25c per text - but they can really add up. Many young people send hundreds of SMS per month, significantly adding to monthly costs. Premium SMS services - including reality show voting - generally cost at least twice the normal SMS rate, and usually aren’t included under cap limits.
UNDERSTAND YOUR PLAN
Different carriers calculate things in different ways, and are not above deliberately confusing customers with complicated terminology and details, as various cases before the ACCC attest. For a fun exercise, try a direct comparison between an Optus and a 3 Mobile bill. There is a huge proliferation of choice in the mobile phone market, but choice is only a good thing when you understand all the options. Otherwise, it becomes disempowering, leading to confusion, frustration and potential hardship.
OWN YOUR PHONE OUTRIGHT
You can buy a functional handset for under $60. Owning a mobile outright is always safer than paying one off on a 24-month contract. Depending on the carrier, the cost of paying out the handset if you break your contract might be bigger than you realise.
BE CAREFUL WITH YOUR HANDSET FEATURES
Phone companies aim to make spending money effortless. They provide handsets that can access expensive premium features very easily, sometimes by accident. These costs add up very quickly.
TAKE CARE WITH MOBILE DATA
Browsing the internet costs a lot more than making phone calls. Most Australian mobile data plans are smaller than you might realise, and it is very easy to exceed them, leading to very large bills. Additionally, if you have a smartphone, make sure you keep track of what your handset is doing in the background. Various data options are often defaulted to ‘on’.
BE VERY REALISTIC ABOUT YOUR NEEDS
Be honest about why you actually need a mobile. Basic calling functionality is generally the most anyone would ever truly need a phone for. Anything beyond that is a luxury, and luxuries are rarely free.
Our advice? If in any doubt, buy a handset outright, and go prepaid. You can always go on a plan later, once you better understand your needs usages patterns and choices.
The Australian mobile telecommunications marketplace has matured to a point at which the stream of new customers has slowed to a relative trickle. Our telcos are increasingly obliged to poach customers from each other, with the result that they are being forced properly to compete.
This has seen the major players introducing new products, new services and otherwise trying to increase the value of their mobile offerings. Telstra this month has introduced new measures to combat bill-shock, whilst also reducing the price on many of its data packs. Optus has done the same. Virgin Mobile has introduced monthly data rollover.
It seems like a great time to be a mobile customer in this country. But how do we compare to other, similar countries such as the United States or the United Kingdom?
Virgin Mobile recently released a data rollover provision whereby an unused data from a particular month will become available for use in the following month (but no later than that).
Seems pretty good, but …
T-mobile in the USA offers a similar service – called Data Stash – that stores unused data up for 12 months. (Other US telcos such as AT&T and Sprint offer a month-to-month service.)
Vodafone Australia are great believers in giving you bonus data when you sign up, usually as part of ‘limited’ offers (though there’s almost always one of these one). For example, right now if you sign up to an $80 per month plan Vodafone will throw in an additional 4G of LTE data, on top of the 4Gb already included in the plan.
Seems pretty good, but…
Sticking with T-Mobile in the USA, they offer a 10Gb upfront buffer on their cell phone plans, which you have to get through before you even touch your included monthly allowance. This 10Gb is valid for 12 months after you sign up.
Vodafone UK, meanwhile offers three months of unlimited data on new SIM-only plans (one of which includes an attractive 6Gb for £27, with unlimited talk and text).
Automatic Data Packs
Both Telstra and Optus now automatically add a $10 1Gb data pack to your account as soon as you exceed your monthly data limit, ensuring that you won’t be slugged with exorbitant pay-as-you-go rates.
Seems pretty good, but…
A few telcos overseas actually offer unlimited data. For example, Three Mobile in the UK offers SIM-only, month-to-month plans starting at £17 (A$32.60) that includes unlimited data(capped at 50Mbps, and subject to their TrafficSense limitations). It is also important to point out that many overseas carriers do not allowing smartphone tethering.
Vodafone Australia has sought to position itself as the best telco for those travelling overseas. For $5 per day you can access your domestic phone plan in 47 countries around the world.
Seems pretty good, but…
This is a bit of a confusing area, since so many international carriers have different ways of charging for roaming. In the scheme of things, Vodafone’s $5 per day is actually competitive.
For example, Verizon in the USA offers 100Mb of data for $25US per month, and 100 minutes or voice and 100 SMS for an extra $15 above that. Sprint, meanwhile, is set to introduce anInternational Value Roaming plan, which allows for unlimited roaming in 15 counties, but only at 2G speeds. T-mobile already offers a similar service which applies in over 120 countries. But roaming on 4G is still exorbitant.
Three Mobile in the UK, meanwhile, allows up to 25Gb of data usage overseas via its Feel At Home provisions, but it’s astonishingly complicated. There’s also a £5 per day Eurozone pass (and apparently bad things happen if the two are combined). Vodafone UK offers the same service as our Vodafone, but for £3 per day.
Issues of geography and distance will almost always mean that mobile plans in this country will be higher, because the infrastructure to provide them costs so much more to implement. Overall, Australian telcos are making steps in the right direction.
But we should not pretend that we’re getting world-beating value. There’s a good reason why overseas visitors are invariably shocked when they learn how much our telecommunications services cost.
Here at Dog and Bone, it feels as though we’ve been writing about the scourge of Bill Shock forever. At last there is hope we won’t have to any more.
Telstra has announced new measures that it feels confident will eradicate Bill Shock, thus giving you 'unmatched confidence'. It is doing this by automatically activating a small data pack the moment you exceed your monthly data limit. You may recognise that as basically identical to the measure Optus introduced a couple of years ago.
Bill Shock, for those who’re unfamiliar with the term, is that wondrous phenomenon that occurs when you open your phone bill, only to discover that the total on the bill is many orders of magnitude larger than you were anticipating. This blowout should not be confused with a slight overcharge (this is Bill Startlement) or the discovery upon reading your credit card statement that your partner subscribes to a certain kind of website (this is admissible evidence).
Bill Shock is most commonly caused by excess mobile data usage or by using mobile data whilst abroad. Telstra’s new measure will address the first of these issues.
Now whenever you use up all of your allotted data, a 1Gb data pack is automatically assigned to your account for that month. Telstra has also reduced the price of these data packs from $15 down to $10. Thus the most you’re likely to pay for going over your data limit is $10.
$10 is also the least you’ll pay, which is an important point to bear in mind. For while Telstra’s pay-as-you-go (PAYG) rates were among the highest in the developed world, they have actually fallen in recent years. The rate is currently $0.03 per MB.
The upshot is that there are plenty of cases where it is cheaper to stay on PAYG and not get a data pack. Simply put, if you exceed your data limit by less than 333Mb, it remains cheaper to stay on PAYG.
Of course, it won’t be possible to make that decision on the spot. You have to nominate ahead of time whether you want your account flagged for the automatic data pack. You will be able to opt-in once the system goes live on May 12.
When Optus introduced their automatic data pack provision in 2013, their CEO Kevin Russell conceded that Australian telcos were ‘increasingly reliant on revenues from breakage fees’. In other words, telcos were banking on customers suffering bill shock, and (one must assume) structuring their plans in order to ensure this outcome. Russell’s admission wasn’t shocking because it was new information – merely by the fact that he made it. Naturally it was timed to imply that Optus’ new largesse resulted from them being no longer able to bear the crushing guilt of fleecing their customers for so long.
Telstra has apparently been able to cope with the guilt for a while longer; apparently with greater market-share comes more reasons to ignore those bad feelings.
Commendably, the last few years have seen a number of measures adopted by Australian telcos to reduce Bill Shock – admittedly at the behest of the regulator – including greater plan transparency, improved data usage tools, lower excess charge rates, and increased data allowances. These combined factors mean that customer misery contributes less to revenue than it once did. Being nice will now cost the telcos less.
But just how nice are they? How much will this putative kindness cost them? There are several factors to consider.
Firstly, those automatic data packs aren’t free. Telstra’s 1Gb pack costs $10, and as mentioned there are plenty of instances where this will cost the customer more than just staying on the PAYG rates. Sadly, we have no access to internal telco billing data, especially for residential customers. On the other hand, Dog and Bone's extensive data shows that business clients rarely suffer huge blowouts. It tends to be a few hundred megabytes, if that.
By linking the new provision with increased 'confidence' Telstra's intention is clearly to promote more carefree use of mobile data. What's the worst that could happen? Ten bucks? Pah! More surfing, less hassle! Perhaps we're just cynical.
Automatic data packs certainly ensure that Bill Shock is addressed. What would have been an enormous and potentially crippling phone bill – and government data suggests that this is a strong cause of personal bankruptcy – will now be reduced to a more manageable total composed of $10 increments. (One wonders whether it will have a greater impact than Virgin Mobile’s recent introduction of a monthly data rollover.)
It will address Bill Shock, but it won’t do much for Bill Startlement. In fact, it might even increase it a little.
So what's it like to work at Dog and Bone?
Information about what we do at Dog and Bone is not hard to come by. Simply searching through this website, or following our Twitter feed, will give you a pretty good idea of what we do and how we help people.
What we’ve never really talked about is our character as a company, and how that translates into our workplace. After all, we here genuinely think Dog and Bone is a pretty tremendous place to work (and not just because there are faceless men in dark suits standing behind our chairs commanding us to say that). It’d be a shame if that wasn’t communicated.
We have a great office in a converted art deco bank on High Street in Northcote. It turns out a bank safe makes for a very secure server room (especially that one time when the key broke). We moved here in 2008, having outgrown smaller premises in North Fitzroy (I admit I miss the post-work kicks of the footy in Edinburgh Gardens).
In that time have seen High Street undergo enormous changes. If it was great before, it’s positively vibrant now. When we relocated there were only a few decent cafes and restaurants, even by a generous estimate. Now we’re spoiled for choice. On the other hand, the great stuff that was already here hasn’t gone anywhere. Institutions like the Wesley Anne and the Northcote Social Club have barely changed at all.
Within the office, there are the standard pre-requisites for any Google-wannabe: Coffee machine – check; standing desks – check; moat stocked with live piranhas – pending. Creative lighting solutions – most definitely (our lighting is supplied by Vintage LED, with whom we have a close relationship). There’s a fish tank whose residents we strive valiantly to keep alive; sadly the mortality rate in that tank is about the same as that of a WW2 bomber crew.
The table tennis (TT) table was acquired on a whim soon after moving to Northcote, and has been a fixture of the office ever since. The table was once a feature of the main office – visiting clients and suppliers were always encouraged to test their skills against our reigning champion – but has now moved to its own special room.
Of course, you don’t have to play 'TT' to work here. (AiLin’s engagement with the game largely consists of long-suffering head shakes whenever a ball caroms into her monitor. Come to think of it, that might be why the table now has its own room.) But, somehow TT has a way of getting its talons into even those who’ve never before hefted a blade (yes, ping pong paddles are actually called blades, which is just one of many ways that table tennis is cooler than you realise).
The extra room comes courtesy of expanded floor space. Gone is the dodgy financial advisor upstairs, whose primary management techniques consisted of bellowing at staff and very heavy stomping. Now Dog and Bone controls the whole premises and has conducted dramatic renovations. There’s a snazzy new entry hall. The new board room is particularly fine. The old board room is still fine, though it’s now full of desks, with people working at them.
The last few years have seen us sustain near-constant expansion. Since 2007 (when I started) Dog and Bone has more than quadrupled in size. Fortunately, we’ve never lost sight of the core principles that define and shape our workplace. I’ve personally never worked in a friendlier place.
We still all go out for a weekly lunch, though now thanks to increased numbers it more often requires a little forward planning and booking in advance. (Or Dan just makes a ‘captain’s call’, because when have those ever gone wrong?) Once there, standard practice is to carefully peruse the menu, make a show of considering all options, and then just order the burger. Sometimes Dan lets us try his salted caramel milkshake.
Otherwise lunch is dominated by the The Age quiz – or the Herald Sun quiz if we’re feeling capricious – read out in Michael’s velvet baritone. James’ speciality is any question about Bradman. Pre-1980s rock music and regional Australian geography sit right in David’s wheelhouse. Discussion of actual work is not encouraged.
There are also social functions, which have evolved from Pizza Meine Liebe around the TT table – kind of miss those, actually – to become movie nights and trips to the opera. (Ok, so far no trips to the opera. Yet.)
Our Christmas parties are invariably inventive and memorable. For example, last year Dog and Bone forewent the clichéd spread at the lawn bowls club, opting instead for a full Christmas week. The entire office relocated to Lorne for the week, working from a beautiful house high on the hills with a full view of the glittering ocean, culminating in our families joining us for a barbecue on Saturday afternoon. Another year we went yachting (kind of don’t miss that, actually).
Angus and Michael last year started Thursday Harvest, a weekly forum at which interested parties are invited to come for coffee and food before work to swap ideas in an informal though loosely structured manner. You can follow their musings at the blog here, and on Twitter here.
On a more structured though still attractively informal note, I mustn’t forget Dog and Bone’s annual planning day. Once per year all employees spend a day working with the Groupwork Institute at a strategic planning retreat. We break down into granular detail precisely how the business is operating – what is going well, what has been achieved, what can be done better – and where it wants to go.
It’s a great opportunity for all staff to provide valuable input into Dog and Bone, from the newest member all the way to the most senior and battle-hardened. By providing a facilitated opportunity to step back and examine the company, these planning days are instrumental in helping Dog and Bone become the company it is. Our very strong focus on customer service, for example, comes naturally from the very robust respect we have for each other, and a group-wide commitment to the improvement of ourselves and our services.
Good news for mobile data users who are prone to exceeding their data cap: Virgin Mobile has announced the introduction of rollover data.
This means that all of your unused data from a given month will rollover, and be added to your mobile data cap for the following month.
However, you should be warned that this data will not accrue indefinitely - it is only valid for one month.
If you’re the kind of user who uses all of your mobile consistently - and perhaps has to purchase an additional data pack - this new provision won’t be of much value. Virgin said that fewer than 20% of their customers fall into this category.
Far more common are users who occasionally exceed their limit. Around 40% of users will exceed their cap at some point in a given six month period.
For those users the unused data from the month before will provide a welcome buffer, and may obviate the need to purchase an additional data pack. Virgin’s own modelling suggests that about 50% of these customers will see savings due to data rollover.
When asked whether this would affect Virgin’s mobile revenue, CEO David Scribner suggested that modelling had suggested that any impact would be minimal, though stressed that they’d be closely monitoring how it worked out in the real world.
Virgin’s move follows the introduction of rollover data by major US carriers AT&T and T-mobile late last year. Like Virgin, AT&T only provide a single month of rollover, while T-mobile allows the data to accrue for an entire year. (I should stress here that US mobile plans are considerably more generous than Australian ones.)
When asked why Virgin was only allowing a one-month rollover, they responded that doing so was consistent with the way voice and text currently rolls over. Telcos love to trot out the ‘consistency’ line, as though customers would grow disoriented or enraged at the inconsistency of having the data last longer.
Anyway, I don’t mean to suggest it isn’t a pretty good deal. It is, and is much welcome. All Virgin postpaid customers who sign up from now on (after March 4) will automatically enjoy this new feature. Pre-existing customers will have to upgrade their plan (at no cost and without signing a new agreement).
Virgin Mobile is an MVNO that runs on the Optus network, including LTE capacity. It is the largest MVNO in the Australian market, with a market share behind only Telstra, Optus and Vodafone. While it isn’t a cheap as some of the truly budget providers, it does historically boast more competitive pricing than Optus or Telstra.
If you feel that data rollover would be of value to you, then you should certainly check them out.
Story of the week has undoubtedly been the revelation – again courtesy of Edward Snowden – that the United States' National Security Agency (NSA) and the United Kingdom’s Government Communications Headquarters (GCHQ) in 2010 stole a very large number of mobile SIM encryption keys.
They did this by hacking into the IT systems of Gemalto, the world’s largest manufacturer of SIM cards, and monitoring and intercepting the communications of its employees. Gemalto produces about two billion SIM cards annually, supplying over 450 of the world’s top telcos, including US giants AT&T, T-Mobile and Verizon. Closer to home, Gemalto customers include Telstra, Optus and Vodafone, which means that pretty much every Australian mobile user could be affected.
Obtaining these keys enables the NSA and GCHQ to monitor large portions of the world’s mobile communications, including both voice and data. They can also access any personal data stored on the SIM. Furthermore, having these keys obviates the needs for complicated interception techniques, and removes the inherent limitations of wire-tapping.
SIM encryption is fairly simple, involving a basic key exchange. The key is kept on the SIM itself, and by your telco. These are checked against each other whenever the SIM is used for transmission. It is a system that remains secure only so long as the secret keys aren’t obtained by a third party, which of course they have been.
It has of course been done without any form of warrant: since the keys were stolen in the first place, it’s not as though the agencies involved were particularly bothered with legality. Nor were they likely to be caught, since interception via these methods leaves little trace on the actual network.
In the event that a telco did detect traces of snooping, the leaked documents also revealed that GCHQ has the capacity to alter billing data to remove evidence of spying.
It is unclear whether all compromised SIMs will need to be recalled. Telstra and Optus have both said they are awaiting further advice from Gemalto. If the SIMs do need to be recalled, it will entail an enormous – if not unprecedented – disruption to national telecommunications. I will update this post as more news comes to hand.
[UPDATE] Vodafone Australia has issued a statement, saying that they "have no evidence that any Vodafone Australia customers’ SIMs have been compromised."
Gemalto meanwhile insists that its systems are secure. (Then again, it also said that it didn’t expect there to be any financial downturn following these revelations. Its share value plummeted to the tune of a half billion dollars following the revelation, and has not recovered.)
The full story first appeared on The Intercept, a website mainly devoted to properly publishing the documents leaked by Edward Snowden. We encourage you to read the full story. As it makes clear: “Gaining access to a database of keys is pretty much game over for cellular encryption.”
[UPDATE] Gemalto's investigation has concluded that while their systems were compromised in 2010, the size of the theft has been "greatly exaggerated." Meanwhile The Intercept has responded, quoting one expert that "This is an investigation that seems mainly designed to produce positive statements. It is not an investigation at all."
Staying with Snowden for the moment, he yesterday appeared in an AMA (Ask Me Anything) on Reddit, alongside journalist Glenn Greenwald and Laura Poitras, director of the Oscar winningCitizenfour. All three were articulate and forthcoming, and it really is a must read. So read it here.