Unlimited plans do actually have their limits
Watchdog says firms offering such deals need to be clear on fine print
Unlimited: Not limited or restricted; infinite. Companies are increasingly using the term in relation to the services they offer, particularly in the competitive telecommunications market where non- capped data, broadband and calling minutes are fast becoming a necessity for many customers.
However, earlier this week the Herald ran a story about a truck driver who was asked to halve the number of calls he was making by 2Degrees, despite paying for unlimited calling. If he didn’t he risked being shut off from his plan under the company’s fair use policy.
The Commerce Commission said traders offering unlimited plans needed to make very clear if there were any qualifications to such offerings.
“In the commission’s view, if a trader has a fair use policy on an ‘ unlimited’ plan, it should only apply to the most extreme users.”
When considering an unlimited plan, customers should ask if a fair use policy applied and view details of that policy before signing up.
The commission had undertaken six investigations since 2015 into offers which were described as unlimited.
Four traders were i ssued compliance advice letters.
We asked the country’s major telcos, and some power companies with uncapped offerings, what strings, if any, were attached.
2Degrees
Calling: The company said it needed to have measures to ensure people did not misuse their unlimited plans for activities like call centres, telemarketing and “extreme usage”.
Its fair use policy did not apply specific minute amounts or limits, but took “average usage and then applies a large multiplier to that to allow headroom, well above that of what the average customer would use, in any given month”, the company said.
“If usage is in excess of the headroom allowed we will commence communication with the customer, but we’ve never terminated based on fair use.”
A very small number of customers had received notifications about usage and a “very, very small portion” of those had had their services restricted.
Data: This, too, was subject to a fair use policy with restrictions around “hot- spotting” to manage extreme usage on the network.
Broadband: 2Degrees’ broadband plan was not subject to a fair use policy.
Spark
Calling: The company said it did not have a fair use policy, stating: “unlimited calling on the Spark network means you can talk for as long as you want to”.
However, it added this only applied to calls and texts to standard New Zealand and Australian numbers. It could not be used for commercial purposes such as call centres, telemarketing, bulk messaging, application- to- person communication, machine- to- machine communication ( including using your SIM card in another device), “or any other activity that Spark considers to be nonstandard personal usage”.
Data: On Spark’s unlimited mobile plan, after 22GB of usage speeds will be reduced. “However, we’ve been careful to reduce to a speed where the customer can still do all the normal things they want to do on their mobile, ensuring an unlimited experience,” the company said. It also did not allow hot- spotting or tethering.
Broadband: There were no restrictions around its broadband data. The only scenario in which it would limit usage was if a customer was deliberately attempting to flood the network or doing something that posed a security risk to its customers.
Vodafone
Calling: Its unlimited talk and text plans were for standard person- to-person calls and texts, excluding “premium and special numbers” such as short- codes. Like Spark, its unlimited talk and text plans were not for commercial use, “multiple simultaneous calling”, “application- to-person communication”, continuous call- forwarding, auto- dialling, machine to machine communication “or any other activity that Vodafone considered to be non- standard usage”.
Data: Its fair use policy was provided for individual use with a focus on usage that it wouldn’t expect to see from ordinary consumers, such as using an unlimited calling plan for auto- dialling for commercial reasons.
Broadband: Vodafone said its unlimited broadband offers were for residential use only.
Electric Kiwi
The company offers an “hour of power plan” where customers can choose 60 minutes at off- peak times to get free power. Company chief executive Luke Blincoe said the plan meant just that.
“We don’t have a fair use policy,” he said. “We actually encourage customers to make the best use of it — we want customers to engage with the tools we provide.” The most extreme example was one customer who used 96 per cent of his electricity in his free hour. The average was about 10 per cent. Electric Kiwi did not service commercial customers.
Mercury
The power company occasionally offers Free Power days — a “one day payment holiday” where customers receive a credit for all the electricity charges associated with their chosen day.
The company said it did not limit usage in any way, with customers consuming an average of five times their daily consumption on their chosen day. One point the company raised was that usage was nearly always calculated using a “smart meter read” but for customers that didn’t have the necessary data, Mercury applied a usage multiplier to reflecting the average uplift in consumption on their free power day to ensure they were appropriately rewarded.