New 50 Device Capacity Brings Savings

Verizon recently announced a capacity increase for their More Everything pool groups.  Now available for optimization of pools are new capacities that are double the prior limits (100GB, 80GB, 60GB) versus the older (50GB, 40GB, 30GB) plans.  It turns out they don’t offer any economies of scale for the new larger plans, the 100GB plan is exactly double the 50GB price and the same is the case for the 80GB and 60GB versus the 40GB and 30GB offerings.  If you are paying exactly double for twice the capacity you might expect little savings by forming larger pools.  However, there are some elements at play here that will likely yield savings for the majority of Verizon customers who take advantage of consolidating to larger Verizon More Everything pools.  As of yet AT&T has not matched these higher capacity Group Share pools but they are likely to follow suit.  Verizon may be the first to push the limits even higher because of a quirk to their billing systems.  Where AT&T allows for multiple pools on a single Billing Account, Verizon forces you to create separate Billing Accounts for each More Everything pool.  That means that any movement to consolidate or re-arrange devices in pools for Verizon requires an account change where AT&T merely has to change the Group to which a device is assigned.  For these reason we project Verizon will be more aggressive in raising the capacity.

The graphs above represent the number of groups required on Verizon for 425 devices. On the left is a view under the previous 25 device limitation and on the right the new 50 device limit.  With both optimized, the configuration on the right saves 5% over the configuration on the left.  The Blue bar in the graphs above represents the capacity of a given pool from 30GB to 100GB.  The colored inner bar represents the monthly usage against that capacity where Green has no overage and Red generates overage.  In addition to reducing the management task by shrinking the number of overall pools, the right hand graph derives savings in two particular ways.  First, the overage fees can be reduced where you can now address large data usage with higher capacity pools.  Second, the limiting factor in Group Share is more often device count rather than data usage.  This means you are adding groups where the device limit has been reached but not the data limit.  More maneuverability is now available with higher capacity device limit, permitting better usage against the GB capacities.  Less unused capacity monthly translates in this particular instance to a 5% lower overall cost.  You are likely to experience the same benefits.

Is the Cost of Unlimited Voice and Text too High?

 With the boundaries of new AT&T Mobile Share and Verizon Share Everything pool offerings defined by data limitations (30GB, 40GB, 50GB), one may erroneously conclude these new plans aren’t well suited for older basic phones. Additionally, since these plans include unlimited voice and text it raises the question as to whether you are paying for capability you might only use on a limited number of voice devices. These new pooling options, which we call ‘puddles’ due to their cap maximum of 25 devices, are well suited to SmartPhone devices because the average data usage of these devices is typically under 2GBs fitting easily into 50GB for 25 devices group share environments. One might ask if the price is right for the voice component of SmartPhones and whether it makes any sense for non-data voice devices at all.  It turns out there are 3 general factors that influence whether you will see savings or not by shifting from classic voice pooling to new group share puddles.

Most business mobility management strategies today include voice pooling as the lowest cost approach to managing voice devices.  As with the data pooling described in last week’s tip, one factor that does determine the savings cutover point is the carrier discount percentage.  Because the line access charge for each group share device is not discounted but typically your voice and data access plans in classic pooling are, you will find that savings are greatest with group share at the lowest discount rates and become marginalized at higher discount rates.   The second factor influencing group share savings is the ratio of your company’s deployment of basic phones to SmartPhones.  Once SmartPhones have become the majority of your deployed devices, the savings start to shift dramatically to group share configurations as indicated in the chart below independent of discount.

The final factor influencing whether you will experience savings or not is the price point you are able to achieve through your existing voice pool optimization.  The chart above was constructed with an assumption of a monthly list-price cost of $42.50 per device for both voice and text.  This represents what you might typically be paying for a pool averaging less than 250 minutes/month with a mix of text plans.   The cost of a non-data voice device in group share configurations is $30. It would seem obvious that $30 for unlimited voice and text would always win versus a $42.50 list price but phones need to bear some cost burden of the unused data in a puddle to accurately compare cost alternatives.  The chart above does make some assumptions so your ‘mileage will vary’ but it does provide some general guidelines that will hold true.  Namely that lower discounted situations with higher concentrations of SmartPhones will bring you the largest savings in group share configurations.   This chart characterizes savings benefits you might see with Group Share ‘puddles’ based on your ratio of basic phones to SmartPhones.

Finding the Cutover Point for Data Cards

Both AT&T and Verizon have been aggressively pushing their latest Group Share plan configurations to both consumers and small businesses.  AT&T’s Mobile Share and Verizon’s Share Everything pooled data offerings, which we call ‘puddles’, are limited in the number of devices permitted in a pool to a maximum of 25.  This limitation can produce management headaches for companies with hundreds or thousands of devices.  Particularly challenging is the fact that for Verizon each ‘puddle’ must be on its own billing account number.  The other limitation for large companies is that the offered Group Share choices only span a limited data range from 30GB to 50GB thus forcing companies to carefully assemble the devices to be combined in any given Group Share puddle. The price points of these Group Share offerings are quite attractive and will typically generate eye-catching savings when compared to Classic Data Sharing scenarios (pools built from 2GB and 5GB share plans with no device count or GB limitations).  However, the beneficial economics can quickly break down where a lack of persistent maintenance can result in deteriorating, inconsistent and only partially populated pools over time.

The criteria leading to a selection of Group Share configurations is multifaceted. Over the next few weeks we will attempt to deconstruct some of this complexity into smaller more bounded choice points.  There are two flavors of Group Share offerings by the carriers, Data Only Group Share and a more expensive form of Group Share including unlimited voice and text. This week we begin with the choice of using Data Only Group Share configurations versus Classic Data Pooling.

Aside from the complex management decision to break all your data cards into 25 device max puddles, there are two other factors that should influence a decision to move from Classic Data Pooling to Group Share environments.  In this tip we are looking only at data cards and the cutover point to consider Data Only Group Share without the voice component.  The single biggest determinant will be your average GB usage across all the intended pooled data devices.  If your average usage is less than 2.0 GBs it is a straightforward decision.  You will always save money in Group Share puddles.  Once your average data usage reaches 2.5 to 3 GBs you fall into a band where your vendor discount can impact the decision. Discount becomes a factor in the choice of data pooling because Classic Data Card plans are typically discounted while the access charge for Group Share ($20 for data cards) is not discounted. A higher discount drives the cutover point for Group Share to a lower average usage level.  If you have a small carrier discount, your cutover point will shift to over 3.0 GB average versus a discount of 20% where it makes sense to move to Group Share in a lower range of 2.0 to 2.5 average GB usage.