Excess data charges explained


Many of us would be lost without our mobile phones, largely because they keep us connected with our virtual lives through social media, and because they provide so much entertainment on the go. It’s for this reason that data has become the most important feature of phone plans in the eyes of many Australians. But if you go over your postpaid plan’s data allowance, those Facebook and YouTube videos can prove seriously expensive. Not to mention streaming Netflix.

What are excess data charges?

Excess data charges are what your mobile service provider charges you for exceeding your plan’s limitations. So if you have a data allowance of two gigabytes, for example, you’ll be charged when you go over this limit, usually as a result of streaming media. Some providers have set excess data charges per gigabyte, while others charge you by the megabyte, which can be more confusing. We’ll come back to this later.

How much are you being charged?

Understanding what excess data charges are and why you are being charged is one thing, but do you know how much you are being charged? The amount can vary significantly between service providers. To illustrate this, Canstar Blue has crunched the numbers and can show you which providers are charging the lowest and highest extra data fees, of the 10 major carriers we’ve collected information on.

The first thing to say is that, if you do go over your data limit, the majority charge a very reasonable $10 per GB, which has emerged as the industry standard amount. However, charges can vary dramatically and if you’re unaware of the dangers, going over your data limit could cost you a small fortune. You particularly need to pay attention if you’re a customer of Jeenee Mobile or Virgin Mobile.

The following table shows how much some of the biggest telcos in Australia charge per extra megabyte or gigabyte used on postpaid plans. While this doesn’t include every service provider in the market, it gives you a good idea of how extra charges can differ and the importance of checking the small print.

Service provider Plan Name Data cost Cost per extra GB
Amaysim All postpaid plans $9.90 / GB $9.90
Bendigo Bank Telco All postpaid plans $10 / GB $10
iiNet All postpaid plans $10 / GB $10
Optus All postpaid plans $10 / GB $10
SpinTel All postpaid plans $10 / GB $10
Telstra All postpaid plans $10 / GB $10
Vaya All postpaid plans $10 / GB $10
Vodafone All postpaid plans $10 / GB $10
Jeenee Mobile All postpaid plans 4c / MB $40
Virgin Mobile All postpaid plans 5.2c / MB $52

Information sourced from service provider websites August 2016. 1GB = 1024MB.

Megabytes vs gigabytes

When you’re comparing excess data charges, it’s important to understand the difference between the two units that data is measured in – megabytes (MB) and gigabytes (GB). You’ll usually see MBs referenced as the amount of data in low-cost mobile plans, with 500MB a common allowance in plans costing under $20 per month. Once your plan heads over $25 or so, you’ll be dealing in GBs. Mobile carriers generally define a gigabyte as 1,024 megabytes.

It’s crucial you know this because some service providers charge for excess data based on MBs used, rather than GBs, and as you can see from the table above, the two carriers with the highest fees for excess data both charge by the megabyte. So when you’re reading the details of your plan, make sure you know exactly what you’re paying for, because at 5.2c per MB, the costs will quickly add up. To put that into context, a standard five-minute YouTube video will use up the best part of 30MBs of data, costing you about $1.56 in excess charges just to watch a cat fall off a washing machine. This is a serious issue for many postpaid plan customers, with 35% of 18-29 year-olds regularly exceeding their monthly data allowance, our research shows.

How to avoid excess data charges

One way to avoid excess data charges is by purchasing add-on data packs from your service provider – most of which now offer them. These packs are basically a safer and more cost-effective way of increasing your monthly data allowance without paying for it retrospectively via a shock bill. This is a great option if you know you’re going to have a big data month due to travel arrangements, for example, or because your favourite Netflix show has a new season coming out and you just have to watch it on the bus home work from.

As an example, Telstra currently offers three levels of data packs – small, medium and large. The small add-on comes with 2GB of data plus unlimited calls, SMS and MMS. The medium and large packs also come with the same unlimited features, but bump the data up to 5GB and 8GB respectively. If you still manage to go over your data allowance, you’ll be charged just $10 which will give you another gigabyte of data.

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Understand your data usage

The other way to avoid excess data charges is simply to understand your mobile data usage. Are you the type of person who watches lots of videos on the go (i.e. when not connected to Wi-Fi) or do you mainly use your mobile to keep up with emails? It’s easy to underestimate the amount of data-intensive things you do on your mobile because all those short Facebook videos can add up. So a good solution is to find out exactly how much data you do use in an average month.

Vodafone is leading the way when it comes to helping customers understand their data needs. Its 12 or 24 month Red plans offer unlimited data in Australia for the first two months in order for customers to get a real idea of how much they will need going forward. At the end of the ‘Data Workout’ period, Vodafone will tell you how much data you have used and you can change your plan accordingly.

Finally, the best advice anyone can give you is to pay attention to your data usage. The telcos are obliged to send customers warnings about data use when they reach 50%, 85% and 100% of their allowance. However, there have been concerns raised that these alerts are not received very quickly, meaning you can chew through plenty of data before you realise you’re being charged for it.

You can avoid this potential pitfall by setting up your own data usage alerts with the software built into all new Android and iOS devices. Android devices come with robust data monitoring, with the ability to set a warning when you reach a pre-set monthly limit, while the latest iPhone models allow you to monitor which apps use the most data.

Yes, some mobile service providers do charge more than others in excess data fees, but at Canstar Blue we like to promote consumer responsibility – so find out how much data you need and make sure you don’t go over your limit, unless you know you can afford the extra cost.

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