Legacy Unlimited Plan: Throttling, Repricing and a Self-Preference
Solent Mobile sells a legacy 'Truly Unlimited' postpaid plan at 35 per month to 12,000 subscribers, all on 24-month contracts with no price-variation clause. Three per cent of them exceed 1 TB per month and generate 31% of busy-hour downlink traffic on the two cell sites that are congested at 92% PRB. Finance has proposed: (1) throttle anyone over 50 GB to 1 Mbps until the next billing cycle; (2) keep the 'Truly Unlimited' name in advertising; (3) give 7 days' notice by SMS; (4) raise the monthly fee by 8% from next month for all 12,000; (5) exempt the operator's own streaming bundle from the throttle. The regulator's rules require transparent, non-misleading tariff information, at least 30 days' notice of contract changes, and permit traffic management only where it is non-discriminatory and proportionate. Churn modelling gives 6% if handled well and 18% if not.
1. Assess each of the five proposals against the rules and against proportionality.
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1. Throttle over 50 GB to 1 Mbps - not proportionate as designed. The congesting population is the 3% above 1 TB; a 50 GB threshold captures many ordinary users while leaving the actual 31% of busy-hour load almost untouched (a 1 TB user still passes 50 GB on day two and then sits throttled at 1 Mbps, which does help - but so do moderate users who did nothing wrong). A 1 Mbps cap is also low enough to break interactive video and large downloads, which reads as effective blocking of a service sold as unlimited. A defensible design: a high threshold (e.g. 500 GB) or a busy-hour-only speed reduction to 2-5 Mbps, applied identically to all applications.
2. Keeping 'Truly Unlimited' - misleading. If a material restriction is attached, the name and the advertising must say so, prominently, at the point of sale and in the tariff summary. This is the single highest-risk item with the regulator.
3. Seven days' notice - non-compliant. The rule is 30 days for contract changes; SMS alone is also weak evidence of informed consent.
4. 8% mid-contract increase - breach. There is no price-variation clause, so the contractual price holds for the term. The lawful routes are: apply at renewal, seek explicit consent with a penalty-free exit right, or grandfather.
5. Exempting the own streaming bundle - discriminatory. It is exactly the self-preference the non-discrimination rule targets, and it invites a competition-law complaint from any zero-rated competitor.
2. Design an alternative package of measures that relieves the two congested sites and stays compliant.
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Three tracks, in parallel.
Network (the real fix). At 92% PRB on two sites, this is a capacity shortfall, and throttling 12,000 people is a slow way to buy capex time. Add a carrier or sector split at both sites, or offload with small cells at the hotspot - typically weeks, not years. Target below 70% busy-hour PRB before any tariff change is needed.
Tariff (compliant, no mid-contract breach).
- Grandfather price and terms for the current 24-month term; no 8% increase until renewal.
- At renewal, offer a migration to a named tiered product with explicit thresholds and speeds, with a one-month incentive (extra data or a device credit) and a penalty-free exit.
- If additional revenue is needed now, sell an upsell (higher-speed tier, roaming bundle) rather than a unilateral rise.
Traffic management (proportionate). If management is still needed after the capacity work, apply it as: application-agnostic, busy-hour-only, threshold high enough to target the 3% (e.g. 500 GB, or top-1% per cell), reduction to a defined speed (2-5 Mbps) rather than 1 Mbps, clear notification at 80% and 100% of the threshold, and monthly reporting to the regulator on how many subscribers were affected and why. No self-preference for the operator's own bundle - the same rules apply to all traffic.
Communication: 30 days' written notice, tariff summary in plain language, and a FAQ naming exactly what changes.
3. How would you measure usage and word the 'unlimited' claim so that both the regulator and a churn-sensitive board can live with it?
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Measurement first, because the number defines the fairness.
- Measure per-subscriber busy-hour usage in the cell where congestion occurs, not monthly aggregate. A subscriber consuming 1.2 TB overnight when the cell is empty is not the problem; the top 1% during the congested hour are. Publish the metric you use.
- Confirm the metering is the same engine that bills, with an audit trail and a dispute process - if a customer is throttled on a meter that cannot be reconciled, the credibility of the whole scheme collapses.
- Notify at 80% and 100% of any threshold with the specific remedy and reset date, and give a self-serve usage view.
Wording. The claim 'Truly Unlimited' cannot survive any restriction. Acceptable constructions are of the form: 'Unlimited data with no cap. Speeds are reduced to 2 Mbps during busy hours after 500 GB in a billing period; full speed resumes at the next cycle.' Everything material must be in the headline tariff summary, not only in the terms and conditions - a restriction buried in clause 14 is not transparent.
The professional-ethics point for the board. The 8% uplift and the 7-day notice were proposed because they are cheap, not because they are lawful. The reputational cost of a regulator finding on misleading advertising plus a contract-breach finding is far larger than the revenue at stake: an 18% churn outcome on 12,000 subscribers costs roughly 75,000 per month in recurring revenue, which exceeds the value of the uplift. Put the compliant option to the board with both numbers, and record the decision and its reasoning - that record is what protects the individuals who made the call.