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iPhone on Telstra NextG Cap Plans – Why there is no customer loyalty

I bought the iPhone 3G in July 2008 on a 24 month contract with Telstra. At the time they refused to allow iPhone users to utilise their “Cap Plans”, and as such became the only carrier in Australia to offer iPhones without Cap plans. I signed up to the $80 per month “iPhone plan” and that includes $70 worth of calls.

As of June 26th 2009, the iPhone 3GS was released. Telstra now offer iPhones (the new or old model) on the original plans, but you can now sign up to the Cap plans. Comparing these plans at the $80 per month spend level shows:

iPhone PlanNextG Cap Plan
Minimum Monthly Spend$80$79
Included Call Value$70$450
Bonus Mobile call credit$0$100
Call rate per 30 seconds26c35c
SMS Rate25c25c

Note: For data usage you need to pay an additional cost per month if you don’t want to incur AUD$2 per Megabyte of data. This is the same for iPhone or Cap plan, so I wont compare these in this post.

As can be seen from the above data, the original iPhone plan versus the NextG Cap plans now offered on the iPhone differ significantly. Discounting the flag-fall:

  • With the iPhone plan you get 259 minutes of talking time, roughly 4.3 hours.
  • With the Cap plan you get 608 minutes of talking time, roughly 10 hours. (Not including the extra $100 credit to Telstra Mobiles).

Hopefully you can see now why the Cap plans are better value. What does one do in this situation? One would think that you could call billing, change plans to a practically exactly the same priced plan – and change over.

With the hope of a changeover, I called billing. I wouldn’t mind taking the hit of having to sign up for 24 months again, and I learned that this would be required – BUT – and there is always a but with Telstra, this wasn’t all. If I wanted to change my iPhone plan to a Cap Plan I would have to agree to the following:

  1. Sign up to the Next G cap plan for a full 24 months again
  2. Pay out my current plan (in other words pay off the iPhone)

Paying off the current plan would cost me $850 upfront, or $70 per month for the next year.

Telstra – where is the incentive to keep customers. This is not a way to show it. Had you allowed a plan change to one now offered to newcomers to the iPhone on your network, I’d still be a paying customer for another 2 years (an additional year on top of my current obligation). Money grabbing to “pay out” my current plan and THEN signing up to a full new contract is a customer loyalty killer. Next G speed and coverage be damned.