THE TARIFFIC PERFECT PACKAGE TRACKER - Q3 2015

September 18, 2015

2015 has seen a slew of new Mobile Virtual Network Operators (MVNOs) launch in the South African market. Like Virgin Mobile before them, all of these MVNO’s piggyback on the Cell C network and attempt to differentiate themselves by decoupling the purchase of a phone and contract. Many consumers ask whether these MVNOs are cheaper than the big mobile networks and whether they can save money by migrating from Vodacom, MTN and Cell C to one of these new players. The latest Tariffic “Perfect Package Tracker” quarterly report analyses the new MVNO packages and compares them to the cheapest Post-Paid Contracts available to consumers.

The results are fascinating, with MVNOs performing better than the network operators in 4 out of 5 cases studied, with me&you mobile offering particularly competitive deals on both voice and data. Virgin Mobile, who have gone rather quite of late, also offer some affordable packages for the users considered, while FNB Connect’s new contracts do well on the data side but fall short on voice tariffs.

THIS QUARTER'S USERS & THE RESULTS

Here are this quarters findings:

me&you mobile performs well for you & me

• me&you mobile performed best out of the MVNO’s in 3 of the 5 users we modelled. • Their R300 unlimited voice offering performed particularly well for Susanne, saving her over 50% compared to the other MVNO’s. It must be noted however that according to the me&you website this package is only available for the first 1 500 subscribers. • me&you mobile also offers extremely competitive call rates, with rates as low as 39c/min on their high-end packages.
• me&you mobile’s 5 GB bundle is much cheaper than offerings from other operators which is apparent in the recommendations for Tshepo • Even though me&you mobile don’t offer data contracts, their voice contracts with data bundles added on performed very well for our data user, Maleek.

FNB’s innovation fails to excite

• Even though FNB Connect offers some competitive pricing compared to the network service providers, their pricing has proved to be more expensive than the competing MVNO offers for 4 out of the 5 users we modeled. • One of the main reasons for this performance in this quarter’s tracker is due to FNB Connect’s very high Out of Bundle call rate of R1.50/min.
• FNB Connect’s data offerings are very well priced, with their 5GB data contract being named the Tariffic Pick for Maleek.

Virgin Mobile is still in the game

• Virgin Mobile may have fallen off the radar for some, but they offer some affordable 12-month and month-to-month packages with Virgin Mobile being the top recommendation for Howard and second for Chris and Tshepo.
• Virgin Mobile’s selection of data contracts is very limited, and with a high out of bundle rate, the overall package for our data user, Maleek, performed very poorly.

Hello, Mr Price Mobile (mrp mobile) – are you there?

• mrp mobile have proven to be a very niche player in the cellular space with only 2 tariffs available and a small selection of handsets on offer. • It is interesting to note that the standard call rates on mrp mobile vary from R1.79/min to 79c/min depending on whether you take a SIM-only or a handset deal. • mrp mobile don’t offer large data bundles which disadvantaged Maleek’s recommendations.

Operators beware – the MVNO’s are here!

• In 4 out of the 5 cases that we explored, the MVNOs performed better than the best network performer, making them very affordable for consumers.
• It must be noted though that the packages we surveyed do not come with any phones, and so if it’s a phone you’re after, you may be able to find a cheaper deal with one of the networks.

HOW TARIFFIC’S OPTIMISATIONS WORK

We optimise many different users every quarter, utilising the exact same parameters each time. We then select four users whose change in recommendations best encapsulate the changes to the cellular market over the period. Doing this allows our Tracker to function as a gauge of the South African cellular landscape, identifying how the cellular market is improving or deteriorating for consumers over time.

Tariffic’s optimisations are performed using our award-winning software, which analyses cell phone bills. Tariffic is able to look at a person’s current monthly spend along with exactly how that person uses their phone, in order to calculate what their spend would look like on each network, with the optimal contract/package and bundle combination.

Tariffic’s optimisations tests what a person’s bill would look like on all the different packages and bundle combinations out there and in this way is able to calculate exactly what a cell phone bill would come to each month, taking into account the costs of subscriptions and bundles, as well as the cost of usage over and above subscription (out of bundle spend).

Tariffic’s optimisations do not expect a person to change how they use their phone, as it is based on their own actual historical usage patterns.

Tariffic optimises without a cell phone in mind so that we match a person’s usage to the most cost effective contracts, taking all the complex call rates and tariffs into account. In this Tracker we show the total monthly cost of each recommended package and assume that on each package users would be taking a phone that does not require any additional pay in. It must be noted that when a person takes a more expensive phone, not automatically supported by a package, this increases the monthly subscriptions. In order to make the recommendations as comparable as possible, Tariffic has excluded all handset subsidies (also known as a Connection Incentive Bonus, or CIB) from its calculations to ensure that we’re analysing packages on a like-for-like basis.

Tariffic does not recommend any ‘deals’ that some service providers may be offering (including SIM-only deals) and instead recommends base tariffs only. Tariffic does not take “night-surfer” or any discounted data rates into account for data contracts. Tariffic will only recommend packages from South Africa’s four networks. Tariffic includes an amortised connection fee where applicable and estimates CIB values where they are not available. Note that Tariffic’s recommendations do not take network quality into account and are purely based on price alone.

The following notes are applicable to this quarter’s tracker:

• Tariffic only considered providers that offer minutes, and thus excluded all data-only providers.

• Only Bring Your Own Device options were used on Virgin Mobile. Both 12 month and month-to-month contracts were considered.

• Only FNB Connect’s contract packages were considered in the optimisations.

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