Thursday, February 12

Their math vs your math

When I was shopping for cell phones, I briefly considered AT&T's early nights feature. According to the website, I could start my unlimited nighttime minutes at 7 p.m. And it was only 30 cents a day.

Given that 9 p.m. is a little late to get started on your major calls, this was initially very appealing. After all, who can't spare 30 cents a day, right?

Then I wondered, how did AT&T arrive at 30 cents? Sure enough, a little math showed me that the company was averaging the $8.99 monthly fee over the course of a 30-day month.

But, really, this feature doesn't apply to weekends, which already have unlimited minutes. So why count them?

Instead, I divided the $8.99 by 22 days of actual use. (Assuming an average of 8 Saturdays and Sundays in any given month.) The cost was still only 40 cents per day. Still a pretty good price, right?

But, really, the feature doesn't apply to the whole day. It is really just for two hours -- from 7 p.m. to 9 p.m. After that, my minutes would be unlimited anyway. So why stretch the cost over a whole day? Instead of 40 cents a day, it would be 40 cents for the two hours -- or 20 cents per hour.

Granted, the rate is only 20 cents/hour if you use the phone between 7 and 0 p.m., Monday through Friday. Otherwise, the cost per use is going to go up -- maybe closer to $1 an hour.

Technically, this cost is also only true if you also use every minute of your cell plan. If you routinely have time left over in your plan, the early evening/weekend minutes are at least partially redundant. And the more minutes you have left over, the less you really needed to pay that $8.99 for the month.

And, hey, there's every chance that you use most of your minutes and consistently get on the phone in the evenings. There's every chance that 20 cents an hour -- or 40 or 60 -- is worth it for you.

But what you have to remember is that AT&T marketed this feature as 30 cents a day. By my calculation, the best you can get is 20 cents per usable hour.

That's quite the disparity. Even more startling, both numbers are correct.

It's a good reminder that numbers are mutable. They can be massaged, toyed with, and just generally manipulated. And that's exactly what most retailers do.

We already know that it's in their best interests to sell. That means they are intent on giving you the most attractive terms, not necessarily the most accurate. It's their job to sell; it's your job to do the math as it pertains to you.


Blogger Cents in the City said...

Back in July I decided to leave AT&T to get the Spring Sero plan which was about to be retired. AT&T hit me with a $175 fee for leaving as I did not qualify for their new terms when breaking the contract.

Sero will be worth it in the long run though. I get unlimited text, unlimited internet, 500 anytime minutes, and free nights and weekends starting at 7:00 pm. My AT&T plan was somewhat comparable for me, minus the internet use and the fact nights started at 9 pm. I always thought that was a little bit late.

I'm surprised that anyone needs 7 pm nights with AT&T. If you're constantly using all your minutes you should move up in the next tier in your plan. Rollover minutes were one of the best AT&T perks. I never worried about going over; because I had a pretty nice bank by the time I cancelled my account.

February 13, 2009 at 12:04 PM

Blogger Revanche said...

It's very important to consider whether or not that extra 2 hours a day is worth it to you. If I was still working the insane hours I used to (6am-7pm), it would be because a lot of my usage would fall between 7pm and 9pm. But now that I commute earlier in the day, it wouldn't make sense since I'm probably home, eating dinner, or whatever and can wait an hour or two to make calls.

February 13, 2009 at 7:56 PM

Blogger Fabulously Broke said...

I find it very useful to have it at 7 p.m. only because I sleep at 9 p.m. and don't stay out past that time. So to me, the cost is worth it, even though it is extravagant.

February 14, 2009 at 5:24 AM

Blogger Abby said...

Revanche & Fabulously Broke,

I think you're taking me a tad too literally.

This was just an example of how companies frame products in the best terms. As I said, it might be worthwhile for some people to pay the $8.99. It depends completely on how you use your cell phone.

My *point* was simply that the actual terms can vary greatly from how the retailers choose to present them. From one standpoint, it *is* only 30 cents a day. A relatively minor cost, overall. But from another, it's probably often 40 cents an hour or more...

Perhaps I should have used more than one example.

February 14, 2009 at 9:52 AM


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