Koodo Mobile shifting towards a three-tier Tab system (Small, Medium, Large)

Ian Hardy

July 9, 2013 11:49 am

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Koodo Mobile will be changing around their Tab structure. According to a few internal docs we received the fierce sub-brand of TELUS will transition from offering one $150 Tab to three tiers of Tabs options. We’re hearing this new way of business might go into place on July 15th, but that’s not confirmed. As for the details, the Koodo Tab will range from “Tab Small” at $0 – $150, “Tab Medium” at $150.01 – $300, “Tab Large” at $300.01 – $500, and No Tab. All the finer details are below and Koodo had also increased the Tab contribution from 10% to %15, plus promises that a “Tab 24 guarantee” that “all customers will clear their Tab within 24 months.”

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(Thanks tipster!)

  • silver_arrow

    I would much prefer if all the carriers did this. If you want to pay more you get a smaller subsidy and if yo want it free you take a large subsidy. No “This is what you get, take it” and more letting you choose how o pay it off.

    Though they should wave the monthly tab charge depending on the price of your plan.

    Also really glad to see them wiping away the tab after 2 years and not 3.

  • Aaron Hoyland

    So is this Koodo’s way of aligning their plans with the new CRTC Wireless Code that’s coming up, since your tab is “guaranteed” to be paid off within 24 months?

    • brittbee13

      certainly sounds like it! I wonder how the big three will deal with it

    • ineptone

      This is how Telus looks to be dealing with it. By testing the program via Koodo, with its smaller subscriber base and fewer top tier phones, Telus is probably looking to determine whether or not this is a viable payment platform to implement throughout their carrier portfolio.

    • Liberal Phone Person

      no, the crtc says that the tab needs to depreciate “in equal amounts” until the balance is 0 after 24 months. So anything other than reducing your balance by (subsidy/24months) is inadequate.

    • casey

      “The early cancellation fee must not exceed the value of the device subsidy. The early cancellation fee must be reduced by an equal amount each month, for the lesser of 24 months or the total number of months in the contract term, such that the early cancellation fee is reduced to $0 by the end of the period.”
      It hast to be 0 by the end of 24 months and can not exceed that of subsidy. It can be 0 before 24 months so long as it is done in equal amounts. This allow tab systems to be paid off before the end of two years.

  • Johnny

    It sucks that people with their own phone still get only 10% off their bill while other customers get 15% off their tab…

    • George

      I’d rather get pay 10% less out of my own pocket each month than have Koodo pay down my Tab quicker. Just saying.

    • Gohy

      why? if you get 10% off say a $40/month plan,that translates to $4/month savings ($96 over 24 months).

      But if you get a “free” tab phone and sell it for say $300, that translates to a savings of $12.50 (which is like a discount of 31%).

      BYOP discounts are a ripoff but the carriers don’t want you to know that!

      Only (perceived) advantage of BYOP is you can leave anytime. But you can set aside the money you make from selling the phone and use it to pay off your tab if you ever want to leave.

    • alphs22

      If you’re on the Medium Tab (Up to $300 off a phone), add $5 tab charge to your bill every month. So over 2 years, subtract $120 to your “savings”.

      I do agree that if you’re going to stay with the same carrier for 2 years, may as well get the tab. However BYOP customers aren’t locked to any sort of agreements to offset the difference.

    • alphs22

      People with their own phone aren’t locked into a 2-year contract/tab…

    • Johnny

      Yes, but I highly doubt that my 60$ unlimited+3GB plan costs them a lot of money. My point is that I need no tab from them as I paid my phone upfront…They could give me a better price on my plan.

    • alphs22

      You are getting a better price – 10% less.
      If their plans -10% are still no good to you, you’re free to jump to another carrier…

    • ando bobando

      Yeah, it only makes sense that the discount should come down accordingly. I’ve long thought that the 10% doesn’t come close to the subsidy repayment portion of the contract prices anyway.

  • Davidyyz

    Curious to see the prices of the “Tab Large” plans.

    • MarkLastiwka

      If you do a bit of math, you can figure it out. For large plans, they charge you $10/month that goes to your tab. They guarantee 24 months to pay out. That means the part you contribute is 24x$10 = $240. If you get $500 off your phone, in order for them to recoup, they will need to get $260 from the 15%. $260/24 = $10.833/month. That amount is 15% of $72.22. The min charge for the large plans will probably be somewhere around there.

      Edit: On second thought, the math doesn’t work out exactly for the medium plan (under the above requirements, you would need a $50/month plan, but koodo only requires $30/month). It looks like $72.22 will probably be on the upper end (maybe $60/month)

    • Graham Fluet

      I wonder if they will rebrand larger existing plans, so we can keep our promos? But I doubt I’ll be able to keep my $56 Unlimited nationwide/ 2Gb data plan though…

    • JP

      You could keep it on a Tab Medium but not on a Tab Large.

    • Liberal Phone Person

      probably similar to the iphone plans.

  • Matthew P

    Great news! on the old system, if you were on a cheap plan and had a tab balance it would take sometimes as long as 50 months to pay it off!

  • Sweet

    So they’re actually going to charge customers a $5 fee every month for the medium and large TAB plans ? Let’s do the math. Let’s say you’re on a $60/month plan and the medium TAB plan. Koodo will contribute $9/month to your TAB, but will charge you $5/month, leaving you with a net benefit of $4/month which is 6.7% of your monthly bill, and less than that if you take a cheaper plan. In that case, you’re better not signing up for a TAB plan and getting the 10% monthly discount. Or did I miss something ?

    As one person put it: “It’s an attack on people who don’t understand math.”

    • JP

      Pretty sure the Tab Charge goes to pay off the phone on top of the tab contribution so it’s a $14 contribution every month.

    • Sweet

      In that case, they should have called it a credit, not a charge. Very misleading on their part.

    • Ih8mndays

      Unless I’m wrong here, but it seems like $5 or 10 a month is a pretty cheap way of affording a higher end phone. Let me see…$500 off the price of a phone – cost of tab over two years (24 x 10 = 240) = $260 savings, interest free over the two years.

      Not sure who doesn’t understand that math.

    • Sweet

      It’s not the math that’s the issue, it’s the meaning of “charge” and where the money goes that’s the issue.

    • ineptone

      Actually, it would be the $240 over two years in addition to the 15% of your monthly bill being credited to your tab. So, for example, if you had a $60/mth bill it would cost $19/mth x 24 mth or a total of $456 for the device. Which is still a noticeable savings when talking about a $500 device.

    • peteve

      If you can take full advantage of the plan, it would be ‘savings’. But if you choose a plan of $50 while a $30 plan can meet your demand, you are indeed paying $20/mo for 24mo towards the phone.

    • alphs22

      You’re still not understanding this correctly
      The tab charge is a $5 charge the customer pays. However, all of it goes down to paying the tab.
      So every month your tab balance goes down by $5 + 15% of your bill. However, what you pay will be your bill + $5 tab charge.

    • Sweet

      OK. Thanks for clearing that up.

    • alphs22

      You missed the part where you get $150-$300 off the price of a phone with the tab.

    • Sweet

      True.

    • alphs22

      Well this is going to vary depending on the situation. What if your plan is $40 rather than $60? Or $50?
      In the end it’s up to the consumer to do their own calculations and see which is better for them.

    • peteve

      both 5/mo and 9/mo go to the tab

  • Jean-Francois Messier

    I have been using Koodo for the last 5 years, mainly because of the freedom of choice we had, way before others. The last thing I would want is to get out of the phone locking thing where you need to pay again to get your phone unlocked from your provider. I never wanted three-year ot two-year contract, and this was my main reason to go to koodo.

  • Liberal Phone Person

    this is the right way to do it. you want 350 off your phone? fine. add $10 per month for 24 months. You dont want money off your phone? don’t have to pay it.

    • Ih8mndays

      agreed

    • lkjlkj

      yes you have with Koodo. Because you only get 10% discount while you should get more.

    • alphs22

      Why should you get more discount? Because you said so?

    • hfghgfhf

      because they can offer 15% to those buying their phones.
      Buying a cellphone from Koodo is as stupid as buying a computer from Rogers with your internet connection.

    • peteve

      It’s kind of encouragement for people to be on Tab.

    • Jim__R

      I would say, not necessarily.

      I bought my Nexus S for $300 from Koodo. Nobody had it cheaper at the time.

      Not too long ago I bought my Galaxy S2X from Koodo for $250. I don’t think you’ll find any comparable Android phone for that price.

      Bought some LG Optimus Ones for family members quite a while ago for $150 per. At the time, that was a very decent price.

      If you’re not looking for the phone with the latest and greatest specs (and price!), a Koodo phone can be a good deal.

      My 2 cents.

    • alphs22

      So you’re complaining that buying a cellphone through Koodo’s tab gets you 15% whereas BYOP only gets you 10%. But then you turn around and say buying a phone from Koodo is stupid.

      See the contradiction in your argument?

  • Yeas

    Long as they don’t assign certain rate plans to different tiers (like Virgin) this could be a great idea. Control how you want to pay.

    • Theo

      That’s what they just did

  • MarkLastiwka

    Nice structure. Now Koodo just needs to get more High End phones. Hopefully the addition of Medium and Large Tabs is sign that they will be adding more High End phones.

  • crimsonablue

    By adding a tab charge, it’s effectively doing the same thing as Virgin’s Silver Gold and Platinum plans, except it’s a separate charge instead of rolled into the cost of the plan

  • Rogers

    Eat a dick, Rogers.

  • Cy

    Finally something that makes sense! Fido had no competition when it came to higher end phones with low monthly plans. It would have taken me 5 years to pay off my Nexus 4!

  • ineptone

    I wonder if this tiered TAB/discount system will be applied to current customers’ accounts? Given that it’s a rolling month-to-month contract system, unless you opted for a subsidized iPhone, there should be no reason it isn’t. As a BYOD customer I wouldn’t mind seeing a 10% discount on my monthly bill.

    • casey

      If you look at the pictures its only available on new agreements and upon upgrade of existing agreements. If you are a current customer nothing is changed.

    • ando bobando

      You can get that 10% discount now. I’m getting it. I just walked up to a kiosk and said “hey! I want this discount!”

    • ineptone

      Thanks for letting me know. I appreciate it. At the moment I just receive the 10% towards a positive TAB balance but I’ll never use it due to my buying unlocked devices outright.

    • ando bobando

      Yeah, I was in the exact same situation. They also let me keep my existing positive tab balance, so a few months later when I decided to get the Nexus 4, I was able to use my positive balance and bring my account down to $0, and then just paid the difference in the price of the phone. All while still getting 10% off each month!

  • sicsicpuppy

    i see there’s a tab charge for tabs higher than $150 .Smart lol

    Either way ,been with Koodo for the last 5 months , couldn’t be happier .FU Rogers

    • ToniCipriani

      More so just a reminder to people that phones aren’t free. Which a lot still refuse to believe.

  • lkjlkj

    Damn it. Koodo starts discriminating again against those who buy their own phone. Why don’t they give a 15% monthly discount instead of 10%? Heck, it should even be 18% to account for interest.

    • alphs22

      Generally when you lock into any agreement for any period of time you get a better deal vs. going month to month. Your agreement guarantees revenue to them.

      It’s not discriminating – it makes perfect business sense.

    • hfghgfhf

      The consumer looses in the end. That means less competition and more control from the telcos.

    • alphs22

      Koodo offering more tab options to the consumer means less competition and more control?

      I’d like to hear your train of thought there.

    • hfghgfhf

      before today, you had the same discount no matter if you had your own phone or used the tab. It changed for the worse.

    • alphs22

      This isn’t true.

      It changed for the better for people getting tabs. Nothing changed for those bringing their own device – hence nothing got worse.

  • Eric Ly

    Interesting that it says all customers will have their tab cleared in 24 months. Hopefully this includes the customers they currently have. I have about $20 left on the tab with them currently. When it is $0, do I get 10% off my bill or will 15% of my plan go towards a positive tab? Before 10% of my plan went towards a positive tab which I used to upgrade my phone.

    • ToniCipriani

      Pretty sure it won’t. Since when did ever new (good) changes other than price increases ever get retroactive for existing contracts?

      Like some others pointed it this is just to align with the new wireless code.

    • casey

      The picture reads new and renewals only. So if you don’t do either of those things you will gain a positive tab.

  • Split4u

    What does it mean “Koodo guarantees the Tab will be paid off in 24 months or less”??

    Let’s say I have the 39 $ plan and 150 $ tab. How can I get to 150 in 24 months even with a 15 % tab without having the 39 $ plan raised in price?

    I might have a reading comprehension fail, please explain to me somebody..

    • accord1999

      Most likely whatever is left in the Tab is wiped clean.

    • Split4u

      wow that is awesome then. Can somebody confirm this?

    • Grant Jeffrey

      15% of $39 is about $6. So $6 x 24 months = $144.

    • kamal

      Tab says 0-150, if you pick up a $39 plan and koodo contributes 15% of $39 is about $6. So $6 x 24 months = $144. You Tab balance will begin at $144. In case you lower you plan to $30 i think they will make you pay the difference to recover the $150 in 2 years, if everything wipes clean in 2 years anyone can select the highest plan and then degrade it to wipe it….just my 2 cents, think you wont be allowed to change plans once you select the tab or pay a difference..still Koodo leads by example

  • Glentel Blows

    Just come to TelephoneBooth, Wireless Wave, Wireless ECT.. OR our newest monopoly telecom retail purchase in target stores! We at Glentel will show you the best plan/carrier to hook-up with to best compensate the company (Glentel) or for salesperson gain. Cause you know, at Gentel if I’m not selling enough Bell/Rogers mix I don’t get bonus. Wait! Did I just sell you a phone, make you buy warranty and purchase an accessory? Here have a “free gift” *hands client free accessories they don’t need, fails to disclose accessory credit to boost accessory sale to make next platue of commission.*

  • rgl168

    IMO this is a way towards separating the device subsidy from the monthly plan. More subsidy -> higher the tab -> more amount the customer is responsible for paying off.

  • fraughtwith

    There one thing that I’m not seeing discussed here. The one price variable at play is the full cost on the phone. If the 24 month fulfillment makes it appear like Koodo will be losing some money to settle those tabs, you may assume that they’ll raise the starting price of the handsets to compensate for this.

  • Graham Fluet

    AWESOME, I was hoping they would do something like this so I can upgrade my phone!

    • Guest

      Wait… I just looked closer and realized I won’t be able to keep my $56 double data unlimited nationwide plan if I use the large tab.

    • kamal

      i have the same too, you are better off taking the medium and $300 discount on the new phone..you should save more than spend $75 on a large plan which can probably give you 1 GB Data ( like their iphone contract plans )

  • fraughtwith

    Seems like there’s some conflicting info in the bullet points too. On Tab Medium the bullet point says can be used on any plan, but the grid indicates plans that are $30 or higher.

    Seems more likely that the grid is correct.

    Leads me to ask one more question. Why would you chose anything less than the maximum within the Tab range if it’s guaranteed to be paid off in 2 years? Even if you planned to pay off the phone early, you would still chose the maximum discount unless your phone’s full cost is less than the tab total.

    • Tom

      Increase upfront discount = limited to only the most expensive monthly plans.

      Fido is already doing something similar – they have a set of decently priced Tab24 plans and a set of absurd Tab36 plans (iPhone only) that charge way more for way less than the Tab24 plans.

  • kamal

    one more week or soon Virgin/Fido will come up with these exact same deals :-) Koodo made Fido come up with the $60 plan and now it looks like fido/virgin have no choice other than to follow koodo…from my personal experience koodo is the best value for the $ we spend..they just need more phone selection

  • God

    When you think about it, on the 500 tab you are really only getting a 260 dollar subsidy as you are paying that other 240, just as a payment. I would be ok with that if you had more plan choices, but tab large plans don’t sound that great. Tab medium you get a 180 subsidy, if you are on the 30 dollar plan, you pay in 108.

    So if you do it right, you can walk away with a profit, but I doubt that it will be possible.

  • JP

    Just looking over your calculations, the tab charge stops when the phone is paid off and your chart doesn’t factor that in.

  • fraughtwith

    I definitely missed that point. Made the change to the spreadsheet and now tabs are clearing up much faster in most cases.

    The only thing I’m not sure of now is if the 15% and tab charge apply on month one. I’m assuming it does because Koodo is saying the tab will always be paid off by 24 months.

    Thanks for your feedback.