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Blind Pursuit of Large Data Volume of 5G Mobile Service Plans Could Lead to Unnecessary Monthly Spending Advised to Choose a Plan Based on Usual Consumption Habits

  • 2021.11.15

With 5G technology gaining popularity and momentum in Hong Kong, various mobile network operators have introduced 5G mobile services to tap into the market. A study by the Consumer Council found that a vast variety of 5G plans were available. In addition to comparing the price, consumers should also pay attention to the data volume, contract periods, terms for reaching the monthly entitlement, and various additional offers. Consumers should also note that operators offer various price plans to appeal to customers with different mobile data usage. For instance, 1 operator’s individual plans ranged from $238 (27GB, an average of $8.8/GB) to $698 (330GB, an average of $2.1/GB) per month, representing a difference of $11,040 in total expense across the 24-month contract period. Despite the fact that higher data volume plans enjoy a lower average price per GB and seemingly value for money, blindly pursuing a plan with a large data volume without genuine need could incur additional and unnecessary expense. Consumers should consider the daily data usage and the needs of family members before choosing a suitable individual or sharing plan to ensure cost-efficiency.

The Consumer Council compared 85 5G monthly mobile service plans provided by 8 network operators. The basic monthly fee ranged from $108 to $1,228, while the data volume ran the gamut from 8GB to unlimited data. Among them, 78 plans required an additional MTR and Tunnel administration fee of $18 per month.

Data volume is one of the key factors when selecting a 5G service plan. Among the 85 plans, the data service of 37 plans would be automatically suspended for the rest of the month once the mobile data is used up. Additional data could be purchased at charges ranging from $10/2GB to $388/100GB. Consumers should carefully choose a plan with the appropriate volume of data to avoid incurring extra expenses.

Upon comparing the plans provided by the same operator, the larger the data volume, the lower the average price per GB. However, consumers should consider the length of the contract commitment period, as well as daily habits and needs on data usage before committing to long-term contracts or large data volume plans. For instance, 1 operator offered individual plans for 27GB and 330GB priced at $238 (average $8.8/GB) and $698 (average $2.1/GB) respectively. Although the latter could enjoy extra 303GB data per month, the difference of $460 in the monthly fee would result in an extra cost of $11,040 across the 24-month contract period. Consumers may wonder whether 5G plans consume more data, but experts have opined that 5G data usage is expected to be 1 to 2 times that of 4G plans. Therefore, consumers could make an estimation based on the actual usage of previous 4G plans, and it may not be necessary to choose a monthly plan with a large data volume immediately.

The individual monthly plans provided by various operators were compared. Taking 100GB/110GB plans as an example, the monthly fee ranged from $298 to $459, a difference of more than 50%.Apart from 1 basic 5G data service plan, the remaining 84 plans were bundled with other value-added services, such as music, network cyber security, and video streaming services, or offering gifts and monthly fee rebates to entice customers. Consumers should carefully consider whether these claimed “complimentary” value-added services and gifts meet personal needs and also take heed of the restrictive conditions. 1 service provider offered a complimentary 3-month video streaming service with all its plans. However, a regular price will be charged for these services once the free trial period and/or contract period ends. Consumers are required to give not less than 30 days' prior notice to the merchant for cancellation of such services to avoid unnecessary charges.

If family members use mobile phones to access the Internet, consumers would consider subscribing to sharing plans to reduce the family's expense on mobile services. The survey was conducted using a family of four as an example. 1 operator offered a 4-person family plan with 100GB at a monthly fee of $396, which means that each card could use an average of 25GB at a fee of $99 per month; whereas the 30GB individual monthly plan from the same operator was $198, which was twice as high as the cost per card (average 25GB) of the above sharing plan.

Although sharing plans are more cost-effective than individual plans, consumers should be aware that the secondary card may not be able to enjoy all the services in the plan with the primary card. The sharing plans provided by 3 service operators restricted the secondary card from sharing the data that applied to the Mainland and value-added services of the primary card. Before subscribing to a sharing plan, consumers should understand the difference in service scope between the secondary and primary cards to avoid failed expectations.

The survey also found that the monthly service plans offered by salespersons through online discussion forums and instant messaging software were more favorable. The official monthly fee for a 110GB 5G plan for college students offered by an operator was $248, but it was $186 when subscribed through a salesperson, a difference of over 30%. Another operator’s salespersons claimed to offer $200 or $600 rebate for subscription referral, and the salesperson even claimed that they could arrange a referrer for customers to earn the reward. Although the plans provided by salespersons from unofficial channels are more favourable, it is difficult for consumers to confirm the salesperson's identity. In addition, consumers need to provide substantial personal and payment information to the salesperson for registration. If the salesperson's identity is unknown, personal data privacy would be at risk. In case any salesperson's oral representation is eventually unfulfilled, the merchant may not take responsibility.

It is noteworthy that if existing customers forget to renew their contract or fail to make a decision when the contract period expires, 7 operators will continue to provide services at the current regular price. 1 operator’s 5G contract stipulated an automatic renewal arrangement at the end of the contract period, which will automatically extend the same period as the previous contract. In addition, if the user plans to stop the service after the contract period, 1 operator required a 2-month advance notice.

Among all monthly plans, the total contract expense of 23 plans exceeded $10,000. 6 of the 8 operators did not provide 5G mobile service customers with a cooling-off period for service cancellation. New customers of 1 operator were entitled to a cooling-off period of 1 month from the registration date, but it did not apply to existing customers who renew or sign new contracts. Both new and old customers of another operator were entitled to a 14-day cooling-off period, but it would end as soon as the customer has claimed a gift, activated a SIM card or value-added service account.

The “Industry Code of Practice for Telecommunications Service Contracts” (the “Code”) issued by the Communications Association of Hong Kong stipulates that if a merchant enters an unsolicited contract with a customer, the merchant must give the customer a cooling-off period of not less than 7 days. However, the Code has a very narrow definition of an unsolicited contract, and the cooling-off period is only applicable if the concerned contracts are concluded during unsolicited visits to a customer's home. The Consumer Council urges the industry to review the Code in line with the times, and proactively protect new and existing customers who register for services through different channels, especially the solicitation of sales that relies heavily on oral representations by salespersons, so as to reduce unnecessary disputes.

Consumers are advised to take note of the following suggestions before subscribing to a 5G mobile service plan:

  • To get consumers to sign up, the operators usually offer gifts or monthly fee rebates, but consumers should pay attention to whether there are restrictions on terms, such as prepayment is required when registering for the plan to redeem the gift; users who cancel the contract must compensate the merchant for the value of the gift at the regular price; and the monthly fee rebate is not refunded in one go, but is deposited into the user's account in instalments;
  • Only the primary registrant of the sharing plan can change or terminate the contract, and the merchant will not accept the requests of the secondary card user. Since the phone numbers in the shared plan are owned by the registrant, if the children using the secondary card want to keep their phone number when switching to a student or individual plan in the future, the registrant must handle it in person;
  • When choosing a sharing plan, it is advised to carefully select a monthly fee plan with an appropriate data volume according to the needs of each family member, and calculate the total expenditure for the entire contract period;
  • Upon subscription of a monthly plan via telephone, street booths or unofficial channels, consumers should request merchants to provide a written contract as soon as possible, and back up verbal commitments by written confirmation. If there is any discrepancy between the written contract provided by the merchant and the promise made by the salesperson at the time of registration, it should be reported to the merchant immediately;
  • When choosing 5G service and/or a 5G mobile phone, make sure whether the 5G mobile phone model supports the 5G network provided by the mobile network operator;
  • Some 5G mobile phones can support more than one SIM card. When considering purchasing such kind of 5G mobile phones, make sure whether all the SIM card slots can support 5G network connections at the same time; or whether there are any restrictions on the 5G connection when all the SIM cards used by the mobile phone are activated.

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