26 February 2013

Cell C contract considerations - just my opinion on how to save some cash

Cell C is - at least on the surface - doing a lot right at the moment, which to me is really no surprise since they've got the former Vodacom CEO now!

Simplifying the contracts has been a breath of fresh air - R1 gets you 1MB, 1SMS/MMS, 1 minute airtime (at 99c per minute per second billing).




Cell C offers you a bunch of these "bundle" deals from R30 per month to R800pm.

The way I see this unfolding is unless you intend to use SMSs and lots of data, you don't want to pay for the bigger contracts, and here's my reasoning, by means of an example:


Allocated Minutes
Used Minutes
Out of Bundle Minutes
Carry-over Minutes
Cost per month
Straight up 100
100
153
53
0
R152.47
Straight up 200
200
153
0
47
R200.00
If you sign up for R100pm (100mins, 100SMSs, 100MB) then you can use up to 100 minutes without paying out extra. If you end up using 153 minutes, you'd pay 99c * 53 (which is R52.47) on top of your 100 minutes (R100) giving you a total usage for the month of R152.47. The alternative is to get the next one up - the R200 per month deal. In the same example above you'll use 153 minutes, bank 47 unused, and pay R200 - you've wasted R47 because if you're not using those 47 minutes, they're just sitting there slowly accumulating and eventually expiring. That's a R47 loss per month on airtime you're not using. 

This is the important factor: Banking the minutes is irrelevant with Cell C because you will be storing up minutes you've not used, that you've paid for, and won't ever get around to using (exhibited by your average monthly usage) whereas the reverse is better - only pay for what you use and that's it - no risk of banked minutes expiring or paying for airtime you won't use

Of course, the ONLY benefit to the extra R100pm on contract is the additional 100MB and 100SMSes but if you don't plan to use that much data, you're better off with my idea.

Over one year the Straight up 100 will cost you R1 829.64 and the Straight up 200 will cost you R2 400.00 which is almost four months paid up on Straight up 100.

So, in my opinion, pay for what you need and then go on pay-as-you-use because you won't end up with extra minutes being banked. The cost per minute remains 99c out of bundle anyway, so actually from a pure talktime perspective, it's cheaper to go with 99c per minute than the R1 per minute in bundle.

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