Telstra’s new prepaid wireless broadband – be careful with the top-ups

There’s little doubt that Telstra’s Next G network reaches the parts of Australia that other 3G networks can’t touch. On the other hand if you’re only travelling occasionally then signing up for a highly expensive contract plan just for once-a-year Internet access seems a bit pointless.

From that perspective Telstra’s recent announcement that it will now offer pay-as-you-go services on Next G could offer welcome relief for mobile workers. Pay $149 for a standard USB modem and you can top up with new credit whenever you need mobile work options. There are seven plans on offer: $20 gets you 150MB of data $30 225MB $40 300MB $50 625MB $60 750MB $80 3.5GB or $100 for 6GB.

Those prices actually compare reasonably favourably with Telstra’s standard contract offerings (400MB for $39.95 a month 1GB for $59.95 a month 3GB for $89.95 a month or 10GB for $129.95 a month). Indeed the $80 and $100 plans fill in gaps in those offerings and the $80 plan works out cheaper overall than the 24 month contract for the $89.95 plan.

However you’ll need to be very careful about how much credit you buy and how you go about topping it up. APC has already noted the problems with Optus’ prepaid option — namely its 10MB minimum access — and Telstra’s offering also requires you to be cautious in your planning though for a different reason.

Like most prepaid services the Telstra plans come with a time limit on the acquired credit — in this case 30 days. If you top up during that time then your credit will be retained. So it might seem tempting to add an extra $20 to a $100 top-up to get maximum value for money.

Unfortunately that kind of strategy will backfire since Telstra actually calculates your usage based on a per-megabyte rate. For the three cheapest plans this is 13.3 cents a megabyte for the next two it is 8 cents a megabyte for the $80 plan it’s 2.25 cents a megabyte and for the $100 option it is 1.65 cents a megabyte.

The kicker is that your data rate is always based on the last top-up you made. So if you have only spent $20 of a $100 plan (which offers 6GB) you would in theory have just over 4800MB left based on the original rate of 1.65 cents a minute.

However if you top that up with $20 the total amount you’ll have available for your refreshed $100 of credit will be just over 750MB (based on the 13.3 cents rate). Alright that might be better than losing the credit altogether but it’s still not a great value proposition. If you can accurately estimate your needs you’ll be much better off.

A lesser warning: the prepaid USB modem doesn’t come with an external antenna so its reach may be limited once you leave major regional cities and towns. In my own experience the standard modem works pretty well even when outside those areas but I’ll be honest — I haven’t tried it in Cumnock or Blanchetown just yet.