iPhone in Canada: Looking into the numbers

There has been a lot of commenting, discussions and complains about the price plans that Rogers / Fido are offering for the 3G iPhone in Canada. The Ruined iPhone web site is an online petition for Rogers to revise their monthly pricing.

The one huge thing that is a potential show-stopper for me is the 3-year contract that you have to sign to be able to have an iPhone in Canada. I don’t know what will happen in 3 years time, but I am 100% certain that I won’t have the same phone (iPhone 4.0 should be out by then). I would not mind paying more more for the phone now so that I don’t need to get locked in for such a long period of time.

Digging further into the offering, I wanted to do the math behind cost for data usage, to get a better picture of what we are actually talking about… and the findings are quite interesting. All pricing below are in Canadian Dollars.

In a nutshell, if you expect to transfer more than 2.1Gb per month and don’t use the iPhone as a phone a lot (under 150 minutes per month), go with the $60 plan, it’s cheaper! If you transfer 5Gb per month, it will cost you $229.80, $234.30, $251.08 and $235.36 on the $60, $75, $100 and $115 plans respectively.

So what do the numbers tell us. Last week, Rogers / Fido announced the price plans they are going to offer for the iPhone in Canada. Here is a screenshot of their pricing as of June 30th (link to the page here):

My initial reaction was really negative based on this. Historically, I haven’t used my cell phones a lot as a phone, but am expecting to use the data option of the iPhone extensively. Therefore linking the included minutes with the data usage doesn’t make sense to me. I am, for the rest of this post, assuming that 150 minutes of voice communications per month will be more than enough for my needs.

And when it comes to text messages, I am planning to have CallerID on my phone, e.g. I will certainly end-up with the $15 Value Pack 1 that bumps the SMS count to 2,500 on every plan (not sure about the extra $5 for the Value Pack 2).

Therefore, the choice of the price plan really comes down to the data usage. To better understand this, I built a little spreadsheet that calculates the actual cost for different amounts of data transfered, resulting in interesting findings. Again, all these assume that the number of included voice minutes are irrelevant.

  • You can immediately see the spike due to the first extra 60Mb at $0.5 per Megabyte vs. the $0.03 per Mb linear increase thereafter.
  • First and foremost, avoid the $100 plan (green line in the graph)… it is the most expensive of all by over $20 per month, except if you are certain you will be between 800Mb and 1Gb every month.
  • The $115 plan (purple line in the graph) only makes sense if you are going to be between 1 and 2Gb every month. Above 2.05Gb of data transfer, it will cost you about 6$ more per month than on the $60 plan.
  • The $75 plan (red line in the graph) is the cheapest if you transfer between 400Mb and 800Mb. Above that, it is about $5 more expensive than the $60 plan, and it is $1 cheaper than the $115 plan if you transfer more than 2.1Gb per month.
  • The $60 plan (blue line in the graph) is the cheapest if you transfer less than 400 Mb or more than 2.1Gb. Comparing the $60 and the $115 plans, you are better off with the cheapest plan except if you know you will be between 1.25 an 2.05Gb per month of data transfer every month for 3 years.
In conclusion, the best option from a price perspective (and the most flexible one) for high-data consumers is to go with the $60 per month price plan, especially if you don’t make a lot of voice calls. If you need more minutes per month for voice, go with:
  • the $75 plan if you need between 150 and 300 minutes per month, knowing that these will cost you about $5 more per month for data charges on high volume. This is worth it considering a $0.35 per extra voice minute.
  • the $115 plan if you need between 300 and 800 minutes per month. This plan will cost you about $6 more per month if you transfer more than 2.05Gb of data per month.
Hopefully, Rogers will change its policy about linking voice minutes with data transfer shortly. And even more importantly, hopefully Rogers and/or Fido will remove the 3-year contract requirement they currently have in place, charging more for the phone like some European operators are doing.

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