In late 2016, back when I took this here blogening seriously, I felt the need to inform you kids about the newest plan from upstart mobile provider Public Mobile. Despite being owned by Telus, the large Canadian telecom which makes up a big chunk of my wife’s RRSP, ol’ Pubby ran things a little differently than the rest of its peers.
It’s an entirely self-serve operation. You had to physically order your own sim card and stick the thing in yourself. Then you have to navigate the website on your own to sign up for service. You can’t call in for help; in fact, Public Mobile doesn’t even have a phone number. If you’re confused, they make you hit up the forums of the website, where poorly paid moderators answer all your pressing questions. Alas, those rat bastards refused to play along when I asked what they were wearing.
In exchange for all of this, Public Mobile offered some uber cheap cell phone service. I personally signed up for a plan that gave me unlimited in-province calling, unlimited text messages and 12 GB of data every three months for $120. After qualifying for a few different discount bonuses (including referring some friends and signing up for credit card auto-pay), I got my cell phone bill down to around $35 a month.
The best part? Public Mobile promised the rate would stay the same as long as you kept paying your bill. I had locked myself into a very good plan for potentially a long time. After all, the company’s marketing was very clear. There would be “no surprises.”
Everything was all fine and good, until last week. That’s when the surprises started.
So there I was, sitting at work, entertaining everyone with my stories of meeting randoms off the internet, when I got a text message from the fine folks at Public Mobile.
(Click to embiggen)
My succulent plan was no more. THOSE RAT BASTARDS. MORE LIKE PUBIC MOBILE, AMIRITE?
I was pretty pissed, but was resigned to the fact that the price would be going up. $140 every three months (after bonuses) was still a pretty good deal for what I was getting, and if there’s one thing these companies understand, it’s my laziness. Most people would just shrug and move on. That’s what I was prepared to do.
Good thing the rest of Public Mobile’s customers aren’t as lazy as me. They actually did something about it. Oh, did they ever.
Thousands of them took to the internet to voice their displeasure. Reddit threads quickly blew up, as hundreds of users pledged to report Public Mobile to the CRTC for false advertising. Remember, the company promised “no surprises.” Countless more took to Twitter and voiced their displeasure, tagging local media and consumer-minded TV shows like CBC Marketplace. Apparently there are some 300,000 Public Mobile customers, and most of them were PISSED.
24 hours later, the company caved.
It sent out a new text to affected subscribers saying it wouldn’t go through with the price increase. But it did keep the possibility of hiking fees at some point alive. In an official statement, General Manager Dave MacLean said “while all good things must come to an end at some point — that point is not today.”
Cheap asses everywhere rejoiced their victory, at least for now.
The lessons learned
This wouldn’t be a Financial Uproar post without looking at the bigger picture. How can you personally profit from this information?
Let’s talk a little about being the low cost provider of something. While it can be a lucrative spot to be in a market for the right organization, it usually isn’t a smart idea. For every company like Wal-Mart, there are a million imitators that fail badly.
Let’s face it; price-conscious customers are a pain in the ass. All they care about is getting the best value for their dollars. If you target that market, be prepared to be fought tooth and nail over every price increase. Meanwhile, the top end of the market is much easier. They’ll gladly accept price hikes in exchange for a better product.
Many companies begin as price leaders before realizing it’s a crummy place to be. Westjet got its start undercutting Air Canada. These days the average Westjet fare is no lower than the competition. McDonald’s is no cheaper than Wendy’s or Burger King. Pepsi tried to be the better value proposition than Coke for years before finally giving up. And so on. There are hundreds of other examples.
Of course, Public Mobile is only a small part of Telus, which is a behemoth. At the end of the day, thousands of people leaving Public Mobile is nothing more than an annoying inconvenience. When you’ve got close to nine million subscribers, you can afford to piss off a few customers. Besides, both Bell and Rogers are doing the same thing, somehow. We’re naturally wired to hate all utilities, which is why they end up being pretty good investments.