Consumer Watchdog: Telco tool finds best buy

Haggling with communications companies can get a better internet package. Photo / Thinkstock

If you wanted to figure out the cheapest deal for your mobile, landline and internet use, you would need to get your head around nearly 37 trillion possible combinations.

Until now. Consumer NZ has launched TelMe.org.nz, a tool that runs your phone and internet needs against every package, plan and added extra available.

Within a few minutes you get a list of the best-value options and instructions on how to adopt them.

It comes in the wake of Consumer NZ's PowerSwitch campaign, which spurred 18,000 Kiwis to ditch the big companies and sign up with better-value providers. It reckons TelMe might be just the kick the telecommunication industry needs to give customers a better deal.

"We're hoping it will have some effect on the industry," said David Naulls, one of the forces behind the site.

"It's a confusing space out there and it's difficult to compare plans. There's something like 37 trillion different calculations if you wanted to look at the different options."

More than 17,000 people have used the tool since it launched last week, but changing telco providers can be trickier than jumping to a cheaper power company.

Many customers are signed on to long-term contracts and termination fees could override any savings made by changing.

Telecommunications Users Association of New Zealand chief executive Paul Brislen recommended that people held off signing fixed-term mobile plans until the New Year, when the second wave of mobile termination rate changes came into effect.

The Commerce Commission has already forced companies to halve the fee which is charged to rival networks for connecting calls and messages. But the ruling only applies on a wholesale level, and Vodafone and Telecom are yet to pass on any savings to customers.

Brislen said he was supportive of the TelMe concept - and anything else that armed consumers with information - but was concerned the website had some glitches after it told him the cheapest option for his household was $149 a month. His current package costs him $50 less than that.

Bargaining gets better deal

Hard bargaining rather than market research got business student Janet Martin an excellent deal on her home and internet costs.

Instead of telling Telecom's door-to-door salesman to go away when he came knocking last year, the 56-year-old asked him what his best offer was - then told him to do better.

"He doubled the broadband from 50GB to 100GB," she said. The added data also saved Martin in long-distance calling fees - now she uses Skype to talk to her daughter in Perth.

The deal also included unlimited calling to one national number. Martin and her housemate pay $85 a month for the package.

Martin ran her details through TelMe and found deals that were slightly cheaper but that didn't include the extras she had with Telecom.

Contention rates put thorn in broadband plan

The arrival of ultra-fast broadband has been hailed as a force that will bring New Zealand up to speed with the rest of the world. But one thing could leave you with nothing but ultra-expensive dial-up internet: the contention rate.

This is the number of households that your connection is shared with.

Telecommunications Users Association of New Zealand boss Paul Brislen says if the contention rate is high, the line will be congested at peak times.

"You could have 15Mb a second, but the problem is at 6pm it's not usable. You only get 15Mb a second so long as no one else is on the same connection at the time."

In Britain, a contention rate of 30:1 or 50:1 is common and seems to work well, he says. People should ask about the contention rate they are getting.