What is an Unlimited Data Plan Worth?

The Tradeoffs Versus Data Pooling

For a number of years, data pooling has been offered by carriers but due to erratic data card usage patterns and painful overage rates, acceptance has been limited. Dramatically shifting the balance has been the onslaught of iPhones and Smartphones. With more predictable data consumption rates along with reduced overage rate penalties it is no longer a question of whether to pool data devices but rather, should all data devices be pooled? With the exception of Sprint, who utilizes unlimited data as a differentiator, unlimited data plans are rarely offered except to the largest clients and government entities.

Not long ago, because the carrier bandwidth exceeded the breadth of applications to consume bandwidth, unlimited plans were commonplace. If you are lucky enough to still have unlimited data plans under contract then you can benefit from the savings that come from transitioning data users back and forth between pooled data and unlimited plans as usage patterns dictate. However, for most it now becomes a question of leaving behind that grandfathered unlimited plan and moving permanently to data pooling.

So when is it cost-effective to let go of the security of an unlimited plan? What cost differential is worth paying for the potential downstream need of unlimited data on a given device? When you are trading off quantifiable savings today for a potential need in the future, is any price worth it?

There are three determining factors to consider before permanently forfeiting a grandfathered unlimited data card plan.

The Premium Monthly Cost for Unlimited – the largest factor to consider in deciding to retain an unlimited data card plan is the delta you are paying monthly over a comparable pooled plan option. If the differential in price is relatively small and you have some devices with a history of exceeding 10GB in monthly usage then it makes sense to retain an unlimited plan but only in rare cases such as this. If the delta in price is large ($10+) then a sound financial decision would be to opt for the monthly savings then manage the spikes via buffers included in your data pool.

History of Usage for the Devices in Question – it is difficult to make decisions regarding the appropriate plans without the ability to track historical data usage. It’s preferable to have 12 months of history for all data card usage. Justifiable instances for retaining unlimited plans might appear with data cards showing intermittent spikes of usage reflective in periodic travel of an employee. If the spikes are sizeable but irregular then the cost you save in those months may more than cover a modest monthly unlimited plan premium versus a comparable pool plan option.

Mix of Data Pool Devices and Available Buffer – the larger the device count in a pool, the more easily it will be to absorb random data card spikes. The greater the percentage of smartphones versus data cards in that pool, the more likely your monthly average usage will be closer to 2GB/device versus 10GB/device. If your overall average is approaching the upper plan size of 10GB/device, you will experience less flexibility in retaining a sufficient buffer to absorb data usage spikes over time creating an opportunity to retain some unlimited plans for high usage devices.

Because of the new cost-effectiveness of data pooling, now could be the time to finally move away from legacy unlimited data plans.