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Analysis

Mobile cost concerns - have they gone away?
Rob Bamforth By: Rob Bamforth, Principal Analyst, Quocirca
Published: 8th April 2013
Copyright Quocirca © 2013
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Anyone with a personal mobile phone will have seen the odd big bill, perhaps as a result of roaming or with tariffs where the bundled time, text and megabytes did not match the actual usage, or maybe just too many international calls. But most people only get stung once or twice. Once they understand the consequences of their usage, they can use less hungry data apps, perhaps get a different tariff, or switch from voice calls to text.

Or just pay, after all, tariffs are getting cheaper, bundles bigger and there’s always free Wi-Fi, right?

However, as soon as you introduce business use—whether on a work-supplied device or a ‘bring your own device’ (BYOD)—the picture gets a little murky. 

First who pays, and for what? In the recent halcyon days of all work-related mobile devices being corporate supplied on business tariffs most businesses would deal with the contract side covering all costs with some recovering from employees the cost of personal calls, if they could identify them.

Many employees would never see their individual bills and in some organisations only the finance department would have any idea, until things got really expensive. But hey, these mobile phones boosted the productivity of traders, sales and field service people so was it really a big deal? Not really, until many mobile users appeared, usage patterns changed, bills went up, budgets became tighter and organisations started to think about telecoms expense management (TEM). There are also legislative and tax issues that surround the who pays for personal usage issue.

Now with heavy data usage and employees as consumers wanting to, willing to and doing just about everything on their personally owned mobile phones and other devices, the business/personal usage line is almost impossible to draw.

These devices typically come with Wi-Fi, so that’s a free option? No, it may be free in certain quarters, but according to the latest research from enterprise mobility provider iPass, almost 60% of mobile workers have had to pay $20 or more for one-time Wi-Fi access. While some mobile and internet accounts have Wi-Fi access or minutes bundles, more often than not with a disjointed cacophony of providers, limited Wi-Fi account ‘roaming’ and quirky logins, much Wi-Fi usage outside the office is going to be paid for in an ad hoc manner, expensed and not tracked.

Does BYOD take the issue away? Not necessarily, as it depends whether there is BYOC (contract) as well, and even here the costs do not fall clearly.

Everything appears fine if the employee wants to pay for everything—business and personal use—on their own contract and tariff.

But that may not necessarily reduce costs overall. For a start, the organisation, especially if large or multi-national, would probably have a good deal on its corporate tariff, which personal tariffs just cannot match, so employees are likely to be paying higher rates than when contributing to business contracts.

Business tariffs will also be with one provider and might link into the fixed phone system so that ‘internal’ or ‘on net’ calls would be free or very low cost. With employees bringing their own contracts it is likely that multiple operators would be involved and inter-employee calling made more expensive than otherwise.

Employees may also balk at paying for business use or having business use take them closer to their personal data usage caps—but how are they going to claim? One off claims for Wi-Fi etc. may be easy, but this is again often going under the radar from the enterprise perspective if it only shows up on expenses rather than a telecommunications budget, so not really acceptable longer term. Finally, if business use is starting to dominate then changing behaviours to limit business usage for personal cost reasons undermines the whole idea of using mobile technology to enhance productivity.

The alternative of 'employee-choice with BYOD, but employer picks up the tab' is also fraught with challenges, as personal usage could go completely unchecked incurring not only a direct cost on the monthly bill, but also the indirect cost of time spent not working. This is always a risk, but if the employer is paying for everything on a personally chosen device, could easily be a big problem.

The reality is even more complex as employees will increasingly have a clutch of devices—smartphone, tablet, laptop—each with some element of work and personal use, some of which may be corporate supplied, others not. It may not be sensible or even possible anymore for employers to lock this whole situation down, but it is necessary to understand what is going on in order to keep some control of costs.

More thoughts about mobile expense management are in this recently revised and re-published Quocirca report.

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