Fresh milk and mobile data seem to share the same bacteria problem. Even if treated carefully, it eventually goes sour. To protect consumers from a possibly unpleasant experience, dairy producers put a best before date on milk cartons. Mobile operators go further – they revoke unused mobile data before those gigabytes have become a health hazard.
But consumers have started to question if unused data really is unhealthy and deserve a similar down-the-drain treatment as sour milk. Clever mobile operators realised that they can offer rollover data. One of the pioneers globally is New Zealand’s 2degrees. In this video they ask what is happening to all that leftover data.
So is this just another plug on rollover? It’s hardly new – we wrote about in already in January 2015. No, it’s not about rollover. Because even though rollover is a good thing, operators are still limiting it:
- Saved data is voided after 1 month (as with e.g. Virgin Media)
- Saved data is voided after 1 year (as with e.g. 2degrees)
- You can save a maximum of 100 GB in your account (as with e.g. Telia, Hallon and Vimla in Sweden)
- You can save 3x the monthly allowance (as with ‘3’ in Austria)
- You can save as much as the monthly allowance (as with e.g. all Norwegian operators)
Let’s be clear: All of these implementations are of course still much better than no rollover at all – which is the case for a majority of operators worldwide.
But the business model is still to take something away that customers have bought – and sell it back.
Add-on data is often treated worse than regular data – albeit more pricey. If you run out of data a certain month, operators offer you to buy additional data – often at a premium compared to how much you paid for the data in your regular allowance. Whereas operators are broadcasting their pricing of regular plans, the information around add-ons is often well hidden.
But in many cases – UK’s Tesco Mobile and the two Swedish operators ‘3‘ and Telenor are some examples – add-on data expires at the same time as your monthly allowance, i.e. in less than a month. Let’s say your billing month ends the 25th. The day before, the 24th, you get an SMS stating that you’ve now run out of data. As you can’t imagine a life without it, you buy 1 GB of add-on data for 9.9 EUR. You actually just use 0.3 GB of that data but the remaining 0.7 GB is voided the day after, the 25th.
Some operators treat add-on data better: O2 and ‘3’ in the UK let it live for 30 days, Telia in Sweden for 31 days and Tele2 in Sweden for 6 months.
But even premium add-on data is eventually voided.
So also with add-on data, the business model is to take something away that customers have bought – and sell it back.
A vast majority of consumers – 76% to be exact – want their unused mobile data not to expire and instead roll over. This is shown in fresh research from Ericsson ConsumerLab.
But many operators have painted themselves into a corner as they have super-sized their mobile data buckets – relying on that the unused data anyhow is voided by the end of the month. France is a good example of the imbalance between buckets and consumption: The average French non-M2M SIM uses about 2.5 GB of mobile data in a month. But a 20 EUR per month plan in France comes with a bucket of 20 to 100 GB.
If the French operator Free – that offers 100 GB of mobile data on a stand-alone plan for 19.99 EUR per month – would allow customers to save unused data, their average 19.99 EUR customer (who consumed 8.4 GB of data per month by the end of 2017) would accumulate more than 1000 GB of unused data in a year. Yes, one terabyte.
This gives us one key to understand why unlimited mobile data suddenly has become popular among operators.
By leaving the bucket plan, operators that have painted themselves into the bucket inflation corner can jump out of it. Unlimited operators aren’t selling gigabytes. Therefore they do not need to get involved in the questionable practice of revoking unused gigabytes. They don’t risk having to refund unused data as e.g. Google’s Project Fi and UK’s Smarty (picture below) do.
Unlimited customers consume the data they consume and will no longer think about best before dates. It’s a relief for everybody.
The future lies in monetising customer satisfaction and customer loyalty, not in monetising gigabytes.