Australians are turning their back on potential savings by not shopping around for a different and possibly even slower internet plan despite the obvious savings, according to new research from SpinTel.
SpinTel, the largest independently owned ISP in Australia, says a third of customers were actively looking for a better deal in the past six months but 70 per cent said they would never consider a slower speed even though it could save them hundreds of dollars per year.
The study was conducted among more than 1,000 Australians including more than 830 internet decision makers and it revealed a third don’t understand Mbps or internet speed.
This means many are struggling to find and understand better value and are stuck with plans that are not suited to their needs.
SpinTel CEO Liam Bal says higher speeds don’t always equate to a better online experience.
“Better transparency around how much internet speed is actually required for everyday activities could help customers save money and make more informed choices,” Bal said.
“Most consumers don’t realise that a slower speed, at a reduced cost, can easily meet their needs while saving money.
“For example, a household with 1-2 people streaming, video conferencing and browsing would have a great experience and ample speed with a 50Mbps plan, yet 70 percent of consumers think the faster the better, and pay up to $50 per month extra for speed they don’t require.”
SpinTel’s research found 31 per cent of Internet decision makers would switch providers even if it meant only a minor price reduction while 22 per cent are still thinking about it and 41 per cent haven’t considered a changing provider.
The study showed contract obligations are also complicating things.
More than 20 per cent of internet decision makers in Australia are not happy with their provider while 64 per cent would switch even for a small saving if they could exit their contract.
More than half are locked into contracts and unable to switch but would move to another provider if they weren’t locked in.
The research also revealed Australians online activities with the main uses being internet browsing (94 per cent), shopping online (88 per cent) and engaging with social media (83 per cent).
Other activities like Zoom calls (41 per cent) and gaming (47 per cent) which require a certain amount of bandwidth reveal increased consumer knowledge would lead to cost effective plans tailored to their needs.
One way of saving money that’s not being utilised by customers is bundling their telco services.
Up to 40 per cent of Australians don’t bundle because they’re confused or don’t have complete trust in the internet service provider resulting on more potential savings.
One of the main reasons is not wanting to put all their services in the hands of one company for fear of losing control over their individual services or being stranded in an outage.
SpinTel’s Bal says internet plans should be 100 per cent flexible with no lock-in contracts to give customers more freedom to pick up and move between plans and ISPs as their needs change.
“Internet providers have a clear opportunity to alleviate confusion and build trust with consumers,” Bal said.
“Providing better transparency and education on what speeds are actually needed for daily activities can help customers save money and feel more confident in their choices.”
So how much speed do you need to be able to have a good experience on the internet.
Speeds of up to 20Mbps are more than enough for HD video streaming even though you can probably get away with less than 10Mbps.
Meanwhile, speeds of between 20 and 40Mbps is plenty for 4K video streaming and online gaming.
Netflix says that 25Mbps is enough for 4K Ultra HD streaming on its platform.
Activities like video calling in HD requires just 3Mbps download speeds to enjoy a high quality experience on services like Microsoft Teams, FaceTime, Skype and Zoom.
SpinTel was founded in 1996 and offers mobile, mobile broadband and wireless broadband plans powered by the Optus mobile network.
SpinTel was also awarded Australia’s best provider across mobile, NBN, Internet and Broadband by WhistleOut, Product Review, Canstar Blue Finder and Money Magazine.
