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As many as a quarter of New Zealanders could save money on their mobile phone plan by choosing one better tailored to their use.

That’s easy to say, hard to do. Finding the best mobile phone plan is not straightforward.

There are two problems. First, the way plans are presented makes them hard to compare.

Second, understanding how much to buy is tough if you can’t see your past use. You can get a short transaction history, but you need a year’s worth of information for an informed decision.

You need a full transaction history

Phone companies provide transaction histories on their branded phone apps and on company websites.

How much information is available depends on the company. You can expect to see at least a couple of months of transactions and you may be able to break out data, voice and texts information.

Check the transaction history to see how many voice minutes and how much data you used each month. Write these numbers down.

How does the amount of call minutes and data compare with your current plan?

Break out the numbers

Treat the two numbers, voice minutes and data, as separate.

If both the number of call minutes and data is close to your plan allocation, then you are probably buying the right amount.

If either number is a fair way lower than your allocation, chances are you are spending more than necessary. It’s time to consider a less expensive plan.

One clear sign you should trade down is if your plan has rollover data and you start to accumulate a lot of gigabytes.

It is possible you went over the plan allocation. It may work out cheaper to pay to add on blocks of extra minutes or megabytes of data. Otherwise accept that you may end up paying a one-off amount of few cents extra for casual data or minutes.

One-off mobile phone plan charges

Remember that one-off charges are just that. Moving up to a more expensive mobile phone plan means paying extra every month. If you go over allocation all the time then you could be a candidate for a more expensive plan. But don’t rush into an upgrade ahead of time.

Now you know your needs, you can pick a plan. There are traps to watch for, especially with lower price plans.

Plans can run for one month, one week, two weeks or four weeks. A four week plan means you pay 13 times over the course of a year compared with 12 times for a monthly plan. It makes price comparison hard. You may need a calculator to decide which is better value.

If you want to use your laptop on the move, check the plan allows tethering or hot spotting. Some lower cost plans don’t allow this. Others charge extra.

Sometimes less expensive plans charge extra if you text a photo. This can be referred to a PXT or MMS. You may have to pay, say, 50 cents for each photo. It means you have to maintain an amount of credit on your account on top of the regular plan charge.

The Commerce Commission asked mobile phone companies to make comparisons easier. It didn’t tell them how to do it. Instead the ball is in their court.

Supermarkets

Supermarkets now need to show prices per 100ml to make comparisons easier, many electricity and water companies provide their customers detailed usage information, these are good examples of how telecommunications companies can improve.

Possible improvements include allowing customers to have access to a whole year of transaction history, that would include voice calls, text messages and data use. Carriers could watch to see if customers are overspending and automatically inform them of plans that better suit their needs.

The Commission would like to see a ‘consumer data right’. Consumers would be able to show rival carriers their current use and spend in a way that would allow comparisons and, where appropriate, encourage a better offer.

New Zealand’s mobile sector has come a long way. On the whole competition is delivering benefits to consumers. Yet price confusion remains an everyday headache for consumers.

This article was commissioned by the Commerce Commission.

How to pick the right mobile phone plan was first posted at billbennett.co.nz.

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