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Koodo Tab Increase.


From what I've seen, Koodo is the Canadian carrier who most reflects how European carriers go about providing phones to their customers: not much in the way of commitment; low plan prices; high initial phone buyout - even with the tab (depending on the phone of course). I think it would be a good idea to further that reflection by Koodo slightly increasing it's legendary tab from $150. Even if it started out by only increasing it for loyal customers it would be a start. Koodo's customers get a bit more of a break on the initial phone price, and Koodo has customers who are (on paper) committed for a little while longer.

28 replies

Userlevel 6
Although it would help people pay a lower initial cost with a higher tab limit, it would present a problem to the core of Koodo's subscribers. The brand is aimed at a younger crowd (nothing wrong with that!) and most of the time the accounts they subscribe too are quite cheap (even full featured ones). So let's say the bread and butter plans at Koodo are priced at $30. At the 10% rate the current tab model works with, that's $3 a month that goes to repay the tab. That's 50 months right there just to pay back $150. Would you keep the same phone for 50 months? Of course not, but since the tab is low, you never owe Koodo an unreasonable amount of money to either get out or buy another phone. Now let's take the example of the other approach. Late last year, Telus had a promo for the 64GB iPhone 4S. Basically, they gave it to you if you signed up for a 3yr contract. All fine and dandy, but their retail price of the device was around $800 if I recall correctly. If you were to leave for whatever reason and break the contract after 12 months, guess what kind of bill you'd receive... (800/36)*(36-12) = 533 + taxes. Not cool at all. Pay $533 for a phone you've had for a year and for which the wow factor wore off already? That is the kind of situation Koodo wants to avoid. And keeping the tab low is one good way to achieve that, although it appears illogical to spend more up front.
Some random Mobile Master wrote:

Although it would help people pay a lower initial cost with a higher tab limit, it would present ...

i completely agree, you just read my mind and put it in more sophisticated words in all honesty. and furthermore to what you added, if you did cancel your "plan" with koodo, lets say within a year, you'll still owe koodo around 100$ because of the tab, you had not completely finished paying the tab of your new phone
i completely disagree at the moment, increasing the tab while koodo only takes 10% of your monthly fee is not good at all, however if they did increase the tab and begun taking 20% of your monthly fee, then it would be a different story.
Userlevel 3
They won't be able to increase the tab unless they decide they want to lose money. There is a CRTC hearing right now where canadians have voiced their concerns about contracts. And the CRTC is considering mandating contracts that are no longer than 2 years. So, think about the tab. If they were to increase it to say, $250, and your monthly bill averages $40 then at 10% it would take you over 5 years to pay it off. If this new regulation comes into effect they would have to give up on about $150 that you didn't pay back. ($250- {24 months X $4})= $154 I don't think they'd be that stupid to lose money.
Userlevel 7
EmilX wrote:

They won't be able to increase the tab unless they decide they want to lose money. There is a CRT...

EmilX, that regulation, IF it came into effect would not effect Koodo or WIND whatsoever as they use a tab system. The regulation won't force Koodo into changing the "tab" into a 2 year contract. Everything will stay the same for Koodo (excl iphone contracts). And that's if that mandate is passed, which I doubt in my opinion from what I've read and my knowledge on the topic
Userlevel 3
EmilX wrote:

They won't be able to increase the tab unless they decide they want to lose money. There is a CRT...

Yeap it will. Tab in the regulator's eyes is a contract. Wind already forgives after 3 years not yet because they are forced though.
Userlevel 2
EmilX wrote:

They won't be able to increase the tab unless they decide they want to lose money. There is a CRT...

I don't see the problem, Koodo will just increase plan prices to so the tab is paid off in 2 years.
EmilX wrote:

They won't be able to increase the tab unless they decide they want to lose money. There is a CRT...

I don't get it. How would it change? Don't you have to pay back your tab balance if you leave? You can't just walk away with balance remaining on your tab.
Userlevel 3
EmilX wrote:

They won't be able to increase the tab unless they decide they want to lose money. There is a CRT...

The can't just raise prices of plans James. They would be losing business if they are the only ones increasing the price.@Bob You are right you do have to pay off your tab, but what the CRTC is proposing that whatever balance you take on at the time of buying your phone, the monthly installments would have to be high enough to eliminate your debt in 2 years.
Userlevel 7
EmilX wrote:

They won't be able to increase the tab unless they decide they want to lose money. There is a CRT...

No, the tab system is completely different and this type of system wouldn't apply.
This would apply to fixed term contracts only. The tab is not a fixed term contract, it would not be under the same restriction.
Userlevel 3
Marcus Fenix wrote:

This would apply to fixed term contracts only. The tab is not a fixed term contract, it would not...

Nowhere have I seen the CRTC make a distinction so far on the type of contract they are considering changes for. I beleive the tab will be equally affected.
Userlevel 2
Marcus Fenix wrote:

This would apply to fixed term contracts only. The tab is not a fixed term contract, it would not...

...which would mean most carriers here would be affected by this, as everyone is using some variation of a tab/flextab/supertab type contract these days...
Userlevel 6
Something does't work here... For someone on the $60 plan over 24 months, $144 of the initial $150 tab has been paid back. Someone on the $20 plan only has $48 paid back against the initial $150 tab. Now if Koodo was to forgive the tab after 2 years, the $60 subscriber would clearly be at a disadvantage here because the $20 one would see almost $100 given to him for free, as a courtesy for being on the cheapest plan for 2 years? If customers want subsidies, the current tab model doesn't work. The only way to be fair to everyone would be to split the phone price (or the remaining price if customer has a down payment for the phone) into 24 installments, substract 10% of that amount (because that's what Koodo does with the tab anyway) and add that total amount to the monthly plan cost. Yes, it makes your monthly price higher, but that's what you have to pay to get a more expensive phone. The Big3 does a bit of the same, the difference is they bundle the device subsidy with the monthy plan (which in turn explains why they're so much higher). I still think that we should buy our phones outright, factory unlocked, and simply let the carriers fight on plan pricing only. The current model of pricing based on the number of times you call customer service and brag about loyalty has to die.
It would be great if the CRTC implemented some changes on the Canadian carriers. Personally, because I'm with Koodo, and because I've seen how the tab idea has caught on with other carriers, I would love for Koodo to be the first to make positive changes for the mobile world in Canada. I was doing some online shopping the other day for phones in England, and the way it works over there is: you have no commitment to the carrier longer than 24 months; the initial price of the device is dependent upon how much you are willing to pay monthly. Thus, if you want an SIII Mini you could get it for $0 on a 24 month term, if you're willing to pay $40+ a month. Or you could get it for $79 if you only want to spend $20-$30 a month. Basically the cost of the phone is being distributed among the 24 months but the amount varies depending on your choice. I know Eastlink are doing something similar with their 'EasyTab', where, if the device balance is not paid off by Eastlink after 3 years, they wave it for you (which is like a contract but not worded that way). With Koodo you do have the choice of how much of the tab you want to use, but the same amount is still coming off every month. This is all just food for thought, so I'm not pinning down anything here as a well worked out idea. But the mobile system is heading for a change in Canada, and I would like for Koodo to be ahead of the game. P.S - As an after thought, Koodo could offer higher tab deductions depending on the device price, how much the client is willing to spend, and even monthly plan price. What do you guys think?
i got an Lg phone in november 2010, that phone stopped working about 6 months ago (touch screen stopped working, battery wouldn't charge) and i was out of luck...you still owe on the phone that wasn't built well enough to last through to the end of the tab. I owe $90 on a phone i threw out 6 months ago...
Userlevel 7
mike moddey wrote:

i got an Lg phone in november 2010, that phone stopped working about 6 months ago (touch screen s...

There are many people who have phones who last them for years and through their tabs that I've seen personally. Also, Koodo (and other carriers) don't make the phones, the manufacturers do. It's the manufacturers who need to do something.
mike moddey wrote:

i got an Lg phone in november 2010, that phone stopped working about 6 months ago (touch screen s...

Like Ahmad said, it's not the carrier's fault.
mike moddey wrote:

i got an Lg phone in november 2010, that phone stopped working about 6 months ago (touch screen s...

i still feel there should be tab forgiveness after 2 years, give people incentive to stick around.
Userlevel 3
mike moddey wrote:

i got an Lg phone in november 2010, that phone stopped working about 6 months ago (touch screen s...

Forgiving the tab after 2 years might give customers the opportunity to leave. Of course good plans would be incentive to stay. My carrier in Saskatchewan used to let you upgrade your phone with a full hardware credit after two years even though the contracts lasted three. I think other carriers do the same. So I think their idea is to never let someone reach the end of their contract but perpetually keep the customer on a two year cycle. The downside is you lose a year if you wait to ride out your contract before upgrading. So if Koodo forgave the tab after two years it may come with strings such as getting a new device on the tab. Personally, I'd rather see better plans than a bigger tab. If I decide to buy a $500 to $700 phone I'd like that reality to hit me when I decide rather than paying for it over the next two to five years. I don't know if others feel this way.
Userlevel 6
mike moddey wrote:

i got an Lg phone in november 2010, that phone stopped working about 6 months ago (touch screen s...

^^ Fully agreed. When you buy outright, you get to see first hand the market value of mobile devices. Maybe it would make people more cautious too, currently they're mostly see as throwaway devices since people falsely believe they're free since they've been handed out to them when signing a contract. It's a bit like the Gillette strategy. Almost give away the nicest razor handle possible, and exploit afterwards by selling blades 1000x what they're worth. Then, you can sign Roger Federer AND Tiger Woods to appear in your TV ads.
Userlevel 6
This past christmas I was down in the states and saw that a couple companies (metro pcs and cricket) started phone financing. It very simple, you pay a relatively small amount up front and you pay down the remaining price of the phone in monthly installments added to your bill. Sort of reverse tab. That maybe appealing to some here to. What do you guys think?
Userlevel 6
Chris Petersens wrote:

This past christmas I was down in the states and saw that a couple companies (metro pcs and crick...

My fear with this would be insane interests (unless they give 0% financing). Most probably, before resorting to this, they'd simply instruct people to use a credit card. Koodo would put itself at risk too. Right now, Koodo risks a max of $150 everytime someone gets a phone on a tab. If they financed more expensive devices with montly installments, they'd risk much more. Suppose they finance a $550 SGS3, and charge you only $50 down. That's a $500 risk right there. More than 3X more riskier, compared to $150. I can't see this happening anytime soon on Koodo. And frankly, I'm glad it won't, because it would surely translate into higher plan prices (to offset the risk of some users, they'd have to charge everyone a bit more).
The telus way I find is great for cellphones. They take a certain amount off your device balance every month and say that you want to get a new phone afterwards you just pay whatever the device balance is and you're golden. The tab system annoys me because its a certain percentage taken off towards the tab every month.
Userlevel 6
Nelson Guevara wrote:

The telus way I find is great for cellphones. They take a certain amount off your device balance ...

It depends on the province you live in Nelson. Currently, Quebec and Manitoba are like this, with others likely to follow soon. Also, carriers themselves are adopting a unified system like this one, so soon enough, "early cancellation fees" will be a thing of the past and only device subsidies will turn into due amounts when cancelling a contract. Also, what you describe is also how the tab works, same principle. If you're on a tab and want to upgrade, you simply use whatever amount of tab you have available at the moment of purchase + you pay the remaining price of the phone + taxes and away you go. The main problem with the tab is the time it takes to pay off completely on the cheaper plans, but then again, it doesn't keep you from upgrading.

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