Telecom Expense Management For Data – How Much Do Your Megabits Cost?

One of the major transitions in wireless telecom right now is the shift from voice-only to data devices. The standard company-issues handset is already a low-level smartphone; eventually, every business will want to exploit full-featured internet, real time messaging and cloud software to maintain a truly mobile workforce. The primary challenge is budgetary; there are so many data plans to chose from that it’s hard to decide which will be the most cost-effective.

According to telecom expense management firm GILL Technologies the key is to understand your usage. While the company uses a proprietary software service called Tele-Watch to track its own clients’ data usage, small organizations with a handful of smartphones can control their billing with a very simple manual calculation to determine their cost per megabit.

Cost per bit refers to the price of each megabit of data transfer. This varies greatly based on data plan and type of usage. It’ll go up when you exceed your data plan’s limit, use it in ways not covered by the plan, or go outside your coverage area. For example, if you use your phone as a modem tethered to your laptop your cost per bit may rise significantly for two reasons. First, laptop usage tends to be more data intensive. Second, your phone’s data plan may not cover tethering. Third, many users tether to get laptop internet access outside of home, office or Wi-Fi hotspot coverage – situations where they may be outside of their coverage area.

To calculate your basic cost per megabit you need just two things: your total data usage and costs. The more bills you have, the better; try to calculate the cost based on at least three months of billing. Don’t worry about types of charges for now. This global cost is your company’s benchmark – a number you want to reduce with intelligent usage and plan selection.

Get a detailed bill from your carrier that not only lays out your basic data charges and usage, but details overage, data roaming and other unusual charges. This won’t change your basic cost per megabit (which is based on total billing) but will allow you to figure out the per-megabit charges for any occasional charge. This is your next step.

Once you know your global and occasional per megabit charges it’s time to ask the following questions:

What plan makes the most sense for our usage?

You should pick a data plan with a cap as close to your usage as possible – preferably very slightly under your actual usage. If it goes over, compare the overage costs to the price increase of the next highest tier and choose the less expensive option. If your usage bounces over and under the threshold, examine how to reduce usage. If it varies greatly from one month to the next, ask your carrier about no-overage flexible plans.

What policies can we employ to reduce data costs?

Overage, roaming and services outside of your plan are the most common avoidable causes of a high cost per megabit. Compare your company’s operational area with your carrier’s data coverage and clamp down on wasteful data usage such as recreational web use (standard web pages are usually not a big deal, but streaming media can have a huge impact on your usage).

The answers will allow you to set a constructive smartphone usage policy, pick the right plans and keep your costs down, but it can’t save you the time spent on calculating and tracking costs, and can’t keep you informed of billing errors and carrier changes. For these, along with complex data needs, your best bet is to turn to telecom expense management professionals and cost reduction software.