Mobile Phone Plans You Should Avoid

Lifehacker's Planhacker tables can help you pick out the best contract plans for all sorts of circumstances. Everyone's needs differ, but some plans represent bad value no matter where you're coming from. Here are some of the worst-value options from every major carrier, plus the choices that make more sense.

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Some Stand-Out Stinkers

Let's start by looking at plans that definitely don't make sense, and some better alternatives. (We've quoted the basic monthly price in each case.) We'll talk through these examples further below.

Plan type Don't buy Consider Why?
Entry level BYO Telstra $20 Member TPG $9.99; Vaya $7 Better value and much cheaper
Mid-range BYO Dodo $19.90; Amaysim $19.90; Live Connected $19 TPG $17.99 Cheaper on the same network
4G Capable Telstra $50; Optus $50 Virgin $49 Better value, still 4G
Contract plans iPhone 5 16GB on Virgin $89 iPhone 5 32GB on Virgin $89 Same price for both plans
Contract plans Galaxy S3 Vodafone $50+$10 handset Galaxy S3 Vodafone $60+$0 handset More inclusions for same monthly price
Unlimited Optus Timeless $99/$129 Red Bull Mobile $365; Amaysim $39.90; Virgin Mobile $89 Cheaper, more data, more international calls

Always Buy A Handset First

You can get a handset subsidised by your carrier on a contract but that will cost you more in the long run. You won't have to fork out an upfront, lump-sum fee but you'll end up paying more and you'll be locked into a contract for at least a year, and more often for 24 months.

If you do decide to get a phone in-contract, look at prices between handset models and plans carefully; often you'll find that some plans are completely redundant. For example, Vodafone offers the Samsung Galaxy S3 32GB for $60 a month on the $50 plan. The same handset is available for $60 a month on the $60 plan; the same total cost, but you get additional call value and data and both Infinite options packaged in for the same money.

You'll also find that some plans effectively cancel their own handset options out. The iPhone 5 16GB will cost you $89 with no extra handset costs on Virgin's Topless plan, but so will the 32GB model. If you're going to go with either of these plans, why get the lower value or the cheaper handset for the same monthly price?

Entry-Level Plan Problems

Keep your distance from carriers like Telstra whose entry-level plans are pricey - the cheapest Telstra plan starts at $50/month. Telstra offers casual plans and its Member Plans which start at $20/month, but you can get much better value from one of the smaller carrier plans at the same price point. (Having said that, we realise Telstra might be your only option if you live in some parts of rural Australia. )

If you can, go with one of the Optus network resellers (often called MVNOs, or mobile virtual network operators). They provide good coverage, but at severely discounted rates to give you great value plans.

If you're new to the mobile plan space and only need an ultra-basic service, TPG has a month-to-month BYO $9.99 plan that won't lock you into a contract. Vaya has an even cheaper plan at $7 a month, but it has less call and text value and data. They're not very generous allowances, but they're more than adequate for light users.

The Average User

A lot of people will tell you that the most common mobile phone bill falls into the $50-$69 per month price range. While that is true, it shouldn't be. If you're paying that much per month for your run-of-the-mill phone usage, you're paying too much.

There are plenty of plans that will offer you more than enough to meet your needs for half this price. Again, TPG shines here with its $17.99 BYO Plan, which drops to $14.99 per month for existing TOG broadband customers. Dodo offers something similar with its $19.90 plan (and also brins the price down to $14.90 for current customers). Their rates are very similar, though TPG's SMS charges are lower (28 cents versus 25.3 cents) and its excess data charges (25 cents per excess MB) are half of what Dodo imposes. Both plans use Optus' network and offer unlimited access to key social network web sites. Amaysim also uses Optus, but its $19.90 plan is less impressive. The same goes for Live Connected's $19 plan.

The 4G Hunter

Currently, very few network resellers offer 4G access. Right now, Virgin Mobile is the only provider in this space, offering access to Optus' network. Virgin's plans are cheaper than the competing Optus options, despite working off the same network. If you're looking at Telstra plans (the only option for its 4G network), the same principle holds true as with its other plans: you'll pay a premium for broader coverage.

This is clear when we examine 4G BYO plans at the $50 price point: Telstra and Optus both offer 1GB of data and a similar call allowance ($500 and $600) at this level. Virgin offers 3GB and $700 of calls.

Unlimited Plans

It's easy to assume that all unlimited plans should just be judged by price and data, since those are the main variables when calls and texts are effectively uncounted. However, there are other elements to consider.

On a pure pricing basis, Red Bull Mobile's 365 plan — a year of access for $365 — seems appealing. However, you are stuck on the less-than-optimal Vodafone network.

I can't see great value in the Optus $129 Timeless plan. If you're looking at an unlimited plan from Optus, stick with the $99 Timeless. For $30 extra a month ($720 over 24 months), the additional features just don't seem worth it unless you consistently make over $20 worth of international calls every month.

Even if you do, that's not the plan you want to be going on unless you specifically need the 4G coverage (and live in an area where it is available). Amaysim offer a $39.90 unlimited plan with ridiculously cheap international call rates, starting from just 6 cents /minute and with no flagfall. You'll be hard-pressed to rack up over $89.90 worth of international call charges with those rates. If you need 4G, Virgin's $89 Topless plan is your best bet, with comparable inclusions to Optus' Timeless plans and on the same network. Some smaller carriers that also run on the Vodafone and Optus networks also offer good value deals, including Pennytel's Endless Lite and Exetel's Unlimited plans.

Whether you're just going to be using your phone for calls or if you're a streaming, texting, web surfing master, there is a plan out there for for you. You just have to know where to look. Hopefully, crossing these plans off your list will narrow your search down a little bit.

Have you come across any mind-bogglingly useless plans that made you ask "Why does this exist? Tell us in the comments below.

Guest contributor Kelly Vieira writes for MobilePhoneFinder.com.au, helping Australians compare mobile handsets and plans. Lifehacker's weekly Planhacker column rounds up the best communication deals.


Comments

    All fine and dandy if you don't actually need Telstra for the great coverage it provides for a large portion of the country.

      Here Here..
      I'd expand that and say they're not comparable anyway. Telstra's network is generally superior, better coverage and better speeds in most areas, most of the time.
      Saying that, I'm a cheapskate and connect through an Optus Reseller, cause I don't need the coverage and I can afford to wait for a slower network given the $ saving (which must be in the order of $30/month at least).

      Afterall, what's the point in Unlimited if you can't even make a phonecall... Which was my case for a good 8 months with Vodafone. Made a complaint to the TIO, broke my contract for free and moved to Telstra.

      I've never looked back. Telstra do charge a premium, but after the horrible service I've had with Optus and Voda in the past, I don't see any other choice.

        I agree that the entry level Telstra plans are not ideal for anyone who uses them.

        Instead, I'd recommend checking out Telstra prepaid - specifically the encore offer. Excellent coverage with GREAT value! You can recharge $30 a month and have unlimited calls and sms to anyone in Australia between 6pm and 6am included + a cap to use + data + the $30 for international and extra calls etc.. And it goes up from there - all on the superior network.

        You can even roam with Telstra prepaid to many other countries - with no unexpected postpaid bill!! Check it out.

          That does seem like really good value - but once you run out of credit, you're pretty much stranded until you recharge. I know it's not too difficult to do these days, but if you're roaming especially, how would you do that? I like the security of a plan - I always have that option to go over my value if needed.

    If you buy a 4G phone and don't *live in the CBD* or really need those speeds *all the time* turn the LTE/4G off!
    you'll boost your battery life by a significant amount.

    lol @ suggesting Optus resellers over Telstra plans. Why? "You don't really need that reception, do you? Cheap out and get no coverage!"

    I'm surprised only the $7 plan from Vaya got a mention. Vaya is the best-value Optus reseller around right now ever since LiveConnected raised their prices.

      agreed, I was going to mention that, it smashes the TPG plan listed for mid-range BYO

      Yea - but then you have to try and use Vaya, with poor customer service/absurd billing usage updates/and inability to change plans.
      Used them for a month - left such a bad taste actually went back onto plan with Optus
      Avoid

    You can get a handset subsidised by your carrier on a contract but that will cost you more in the long run.

    This isn't true in many cases. It depends on the handset and the plan. The plan I'm on for example I'm only paying for about half the total cost of the phone.

      So true. I got a new iPhone for an extra $7 / month from Telstra on contract, which works out to only $168 total over 24 months. Quite a bit less than $799!

        My iPhone was $0 a month with Virgin...

          oh so naive. You can get an iPhone 5 on Virgin for "$0" on an $89 commitment. You can get the same plan through VAYA for $39, so $50 a month over 24 months, $1200 you would actually be paying for a phone worth $899. Aint nothing fo free.

          Last edited 13/12/12 2:37 pm

            Except mine was on a $55 a month plan ($50 + $5 for additional data allowance)

        but if you didnt get the phone not only would you say the $7 a month but the cost of telstra BYO plans are also less.

        You actually pay for it in the cost of the rest of what you pay. The $7 a moth thing is just there to con you. They can say -$2 a month if they like or any number. For calls and data they make up their own values: "$50 for $400 worth of calls"- that's just plain fairy-dust. They don't care about anything other than getting that $50 a month from you and having you locked into a contract.

    Yep, this is stupid advice. There are plenty of circumstances where being on a 24 month plan is the best way to go. Being 'locked in' does not mean that it will cost you more money.

      It always does. The fact that you believe it doesn't is only due to clever marketing.

        Being on a 24 month contract does have other benefits. For business clients they get better customer care, extra months free and if your switching between carriers you get port in credits.

        Ok, I was going on the telstra $50/$60 plan anyway. It cost $6 for the HTC One XL (the handset I wanted), so total cost of $16/month over 24 months = $384. Show me how I can get this phone any cheaper.

          The problem is that you're spending $50/$60 for your phone calls, data etc. where on another provider you can get the same amount of phone calls, data for less money, lets say $25-$30 so you're not just saving the $16/mo for the phone, but the $25-$30/mo for the cheaper plan. ALSO people often end up spending more money on crap they don't need, as in unlimited texts, when they can get a super cheap plan with 200 texts and that's more than enough for them.

    Just moved to vaya. Saving a fortune compared to vanilla Optus caps.

      I second your comment on Vaya. I was with LiveConnected on the equivalent $12 plan - but they jacked their prices through the roof, and my friends and family had not yet changed over. We've all now joined Vaya - so that we get the bonus $500 for Vaya to Vaya calls.
      $11 per month gets you $500 of calls (plus another $500 of Vaya to Vaya), plus 1.5gb of data. The $500 of calls is about 8 hours per month - which is more than enough for me needs :)

    So, a tad off topic, sorta, but I was wondering if it's still worth buying a Samsung Galaxy SIII now? I know I definitely want to go with Internode for my sim, $20 a month and 1.5GB of data is the best deal I've seen, and as I don't want to enter a contract or even really use my phone as a phone, but for internet stuff, it's perfect. But, phone wise, I'm torn.

    Are Samsung going to be announcing the SIV any time soon?

    I should also mention that I'd be upgrading from a 5 year old Nokia N95.

    Last edited 13/12/12 3:26 pm

    Please think logically Kelly.

    Other carriers HAVE to have better deals than Telstra. Otherwise, why would anyone be with anyone else but Telstra?

    It's one thing to have a cheap plan, it quite another to be able to actually make use of that great plan. Telstra will ALWAYS be more expensive than the others, and even if they wanted to be cheaper, the ACCC won't allow them to.

      Just because they have to be more expensive doesn't mean I should willingly accept their jacked up prices over better value deals found elsewhere - now you can even get Telstra coverage (or near enough as to not really matter) on Kogan mobile which is amazing value. There is very little reason to go with Telstra outside their 4G speed - and in a CBD, Optus has a somewhat comparable service in that regard for much cheaper (through Virgin, if not directly).

    I bought the $50 plan on Telstra, added a data pack, and i'm happy with it.

    That $50 plan includes $600 for calls & MMS with text messages for free and 1Gb data. OK the 1Gb isn't very much but a data pack fixes that. I don't make many calls. It's perfect for me.

    Why not Virgin: NO 4G in Adelaide from Optus and when it does come here, it will cover a fraction of what Telstra does now - plus i visit Gawler from time to time which has 4G.

    Plus I'd love to hear from anyone actually using Virgin on 4G because I seriously doubt that APN is capable of anything above 4mbps - it's very regularly congested.

    Last edited 13/12/12 4:17 pm

    I bought myself a One X from Kogan (about $400) and then jumped on TPG's $15 a month plan, using optus.

    Before that I was with Telstra for many many years. So let me compare the two.

    Optus's coverage is quite good, Telstras is better, but honestly it isn't that drastic.
    Optus's mobile net is about half the speed of Telstras HSPA+ (Next G)

    But the price difference is a hell of a lot. Optus's sluggish mobile net isn't an issue anyway because almost everywhere I go, there is wi-fi.

      I was recently in NSW (in fact, all over the place.. from Sydney to Blue Mountains, to the Illawarra). Overall, Floptus coverage was surprisingly poor. A friend of mine who has with me - and on Telstra had MUCH, MUCH better reception than I got. I have an iPhone - he has a crappy 10 year old phone.
      I know several mates from NSW that dumped Floptus because of the poor connectivity ... it was them who coined the term Floptus. Thankfully, in my hometown, Floptus coverage is much better than I experienced in NSW.

    My telstra plan was a 'setup and forget' kinda thing. Got home phone, 2x mobiles and 200gb of ADSL2 in one plan. Regular bpay payments through internet banking take care of the rest. The mobile coverage is unparalleled in this country, and the 4G connection paired with my laptop over a wi-fi hotspot is super fast.

    Galaxy S3 Vodafone is $50+$7 not $50+$10 (and a special as of today it is actually $50 + $0)

      Woo.. I'm sold on that.

    "You can get a handset subsidised by your carrier on a contract but that will cost you more in the long run."

    I have an iPhone 5 32gb on the Telstra ‘S’ plan costing $71 per month on a 24 moth contract. The ‘S’ plan is $50/mth when you bring your own phone so basically they’re charging me $21/mth for the phone. Over 24 months this equates to $504. The Apple store sell the 32gb iPhone 5 outright for $899.
    Please explain how buying the phone on this contract will cost me more in the long run?!

      On the same plan, the phone outright will cost more. But you lose your freedom to change whenever you want and you're ignoring many cheaper options - if you scroll up in these comments alone BB mentions Telstra prepaid that is good value and significantly cheaper than the S plan. It's not about looking at just one plan, but widening your scope to get the best deal over all, not just the best deal on that plan or even on just that carrier.

    What do you guys think of the Telstra 4G Samsung G3S $66 plan?

    Where did Australia go wrong?

    I was in Malaysia recently where you get blazingly fast 4G plans offering 6+gb data + unlimited calls/SMS for about AU$30/month.

    There is no point offering such piddling amounts of data for so much money on a 4G network that can be used up in a flash. 4G is for streaming songs from google play or watching the new Foxtel Go service but you would end up using up a 2G plan in less than a week.

    I would pay $60/mo for an 8-10Gb 4G plan to enable me to make use of cloud services and join in on the 21st Century. Australia needs to be better than the 3rd/Developing world, but instead we are lagging far behind.

    Hi Kelly, I'm new to Australia and this article was fantastic for helping me tease apart the maze of mobile phone offerings. Can you offer any updates I should be considering now in Sept. 2013? Thank you!

      Hi Kathy!

      Welcome to Aus! Sorry my reply is a bit late.

      Mobile plans have changed a lot since this post, but the main idea still exists. If you can avoid a plan with handset repayments, you can go with a much cheaper network reseller and get more or less the same network coverage and speeds for much less money.

      If, however, you want to be able to call overseas form your mobile, you're quite restricted. A lot of the small companies don't have that sort of capability.

      Vodafone tends to be pretty good with this, but their coverage in Australia is still pretty ridiculous. Their unlimited Red Plan ($65 / month) has $65 worth of overseas calls (or premium text, etc.), and includes unlimited overseas texts.

      For use to just Australian numbers, Boost and Aldi are pretty good Telstra resellers – Aldi works out to be better value, but Boost has the complete Telstra network coverage (3G only though). Not to mention the recent Kogan debacle leaving a bit of a bad taste when it concerns Aldi's reseller deal.

      For Optus, Vaya's unlimited plan is great value, especially since they have 4G capable plans, but they're entry level plan is beat by LiveConnected.

      If you keep up with Planhacker here, you'll be up to date with most of the plans in Australia. Also, Whirlpool forums are a great source of info from other people, which can be very helpful.

    For readers looking for recommendations for phone plans in 2014, TPG has revised their super value plans due to increased prices from their provider coughoptuscough, so the prices have increase by $2-3, the data allowance is down, there is no free SNS on select plans and it's 5c per excess Mb instead of 25c per excess Mb.

    I'm on an old Telstra plan that means I can roll over any credit & not have to top up every mth. This was fine on the old phones, but since purchasing iPhone 4S, Telstra charges $7-yes-$7 every time I send an mms! I've tried to resolve this issue countless times over the last 2yrs, with zero success. I've come to the conclusion that they are trying to force me onto a new plan ( since they mention this every time I call). Yes I'm (finally) switching to another company, but I like Telstra's coverage & I'm still unhappy at being forced into paying a certain amount every mth.

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