Telcos take byte out of pre-paid mobile bills
Telcos are rounding up data sessions on pre-paid, sometimes to the nearest megabyte. Photo: Louise Kennerley
- Telcos are rounding up many pre-paid customers' data use
- It means customers are charged more than they actually use
- Data can be billed in smaller 1 kilobyte increments instead of larger 1 megabyte increments
- Most post-paid (contract) plans charge in 1 kilobyte increments
Australian telcos are using a trick that enables them to make pre-paid mobile phone customers' data vanish quicker than a user might expect.
If you compare it to something like buying fuel, it would never happen — imagine how annoyed people would be if petrol stations started rounding up to the nearest litre?Elise Davidson, spokeswoman for the Australian Communications Consumer Action Network
It involves the telcos rounding up data "sessions", sometimes to the nearest megabyte instead of kilobyte*, to milk more data out of customers.
If customers don't fully understand the fine print in their contract, they may have to buy extra data packs as data vanishes quicker-than-expected.
Pre-paid plans offer anything from a few hundred megabytes of data to several gigabytes depending on the plan, and can be gobbled up quickly if data sessions are rounded up.
Those affected might notice data vanish faster than usual if they are in areas with no mobile coverage for long periods or when data sessions unexpectedly end with a network dropout.
Sending a typical tweet on an Android phone uses about 4 kilobytes worth of data. If a user's data session ended after the tweet was sent then it would be rounded up under some telco's plans to 1 megabyte, about a thousand kilobytes more than what they actually used.
Most Australian telcos Fairfax Media surveyed that offer pre-paid services participated in the practice, although some to a lesser extent.
Vodafone did so, but from February 13 will cease the practice and will bill data in smaller 1 kilobyte increments.
Lifehacker Australia editor, Angus Kidman, who keeps a close eye on telco plans, said he didn't personally know why telcos rounded up data but suspected they did it to make "a little more money" because most people didn't pay attention to the terms and conditions of their plans.
"Most people don't want to know," Mr Kidman said.
"Also, until very recently, while they charge you this way they haven't had to provide you with detailed information with how they calculate these charges."
Mr Kidman added that it was wrong for telcos "to not make it clear what the consequences" were of what rounding up data meant.
Now that Vodafone has stopped rounding up, there are calls from the Australian Communications Consumer Action Network, the peak body that represents consumers on communications issues, for other telcos to follow suit and charge in 1 kilobyte increments, which means charging only for what data customers use.
"Charging per megabyte is not a fair way of calculating customers' data usage, customers should only pay for what they use," said Elise Davidson, a spokeswoman for the Australian Communications Consumer Action Network.
"If you compare it to something like buying fuel, it would never happen — imagine how annoyed people would be if petrol stations started rounding up to the nearest litre?"
Ms Davidson said the practice of charging in 1 megabyte blocks had flown "under the radar" for a while and was most likely because consumers weren't always aware of the difference between a kilobyte and megabyte of data - and that there were a lot of online activities which could be measured in smaller 1 kilobyte increments.
"We're also in an environment where networks are regularly experiencing network congestion," Ms Davidson said.
"Every time a customer's internet drops out and has to reconnect that starts a new data session, which is another reason that per kilobyte charging would seem the fairest way to calculate data charges."
To understand how telco's charge, one must understand the difference between a kilobyte and a megabyte.
In telco land, a megabyte is generally measured as being 1000 kilobytes (technically it's actually 1024 kilobytes). And although the telcos have the capability to measure data per kilobyte — and do measure it as such on contract plans — most have decided to round up data to the nearest megabyte when a session ends.
A session can start and end a number of times each day and depends on a number of factors, including what smartphone a customer is using, the smartphone's settings, the type of apps they access and how they interact with a telco's network, and whether a customer is in an area for long periods of time where there is no reception.
Amaysim, Woolworths Mobile, Boost Mobile and Kogan Mobile's pre-paid plans all round up data to the nearest megabyte, while Optus rounds up to the nearest megabyte for two of its pre-paid plans and Telstra for one pre-paid plan. Virgin Mobile rounds data up to the nearest 60 kilobytes and Red Bull Mobile to the nearest 250 kilobytes. Vodafone used to round up some of its pre-paid customers to either 25 kilobytes, 50 kilobytes or 1 megabyte but said this would stop from February 13.
Ms Davidson said it was good to see Telstra and Vodafone "leading the way" on data billing by charging in 1 kilobyte increments on most pre-paid plans.
Optus said it was "planning" to offer more pre-paid plans that bill data in 1 kilobyte increments "in the future".
Amaysim spokesman Gerard Mansour said an agreement with its wholesaler, Optus, stipulated charging in 1 megabyte increments.
"Unfortunately, even though we know it's not ideal, this is something we don't see changing in the near future," Mr Mansour said.
Virgin Mobile spokeswoman Melissa Gompes said the telco is "reviewing" how customers are charged for pre-paid data.
Telstra said through a spokesman that the one pre-paid plan it offered which rounded data up was not designed for those that use a lot of data.
* How the telcos charge for data:
Vodafone - Will charge in 1 kilobyte increments from February 13 on all pre-paid plans. Was proposing 1 megabyte increments across all plans before it about-faced.
Telstra - Charges in 1 kilobyte increments on most pre-paid plans but does charge in 1 megabyte increments on its "Simplicity" plan.
Optus - Charges in 1 kilobyte increments on 1 pre-paid plan and 1 megabyte increments on 2.
Virgin Mobile - Charges in 60 kilobyte increments on all pre-paid plans.
Red Bull Mobile - Charges in 250 kilobyte increments on all pre-paid plans.
Woolworths Mobile - Charges in 1 megabyte increments on all pre-paid plans.
Boost - Charges in 1 megabyte increments on all pre-paid plans.
Crazy Johns - Charges in 10 kilobyte increments on all pre-paid plans.
Amaysim - Charges in 1 megabyte increments on all pre-paid plans.
Kogan Mobile - Charges in 1 megabyte increments on all pre-paid plans.