Maxis ditches 2yr contracts, upfront charges with Zerolution plan

• Offers instalment plan on phone price with option to upgrade after a year
• Updates postpaid plans to offer up to 8GB of mobile data

IN an industry first for Malaysia, Maxis Bhd has introduced a mobile phone purchasing scheme that removes the upfront payment for the device and lets subscribers upgrade their phones every 12 months instead of 24 months, turning it into a more flexible instalment payment programme.
 
In a statement, Maxis said its new Zerolution plan removes all the hassles people usually associate with phone contracts. The contract now combines its Zero Cash Upfront, Zero Penalties for changing and Zero Interest easy instalment plans – without the need for a credit card.
 
“Younger Malaysians today now change their phones every 12 to 18 months – which is why inflexible telco contracts that tie customers down for 24 months are too restrictive for today’s postpaid customers,” said Dushyan Vaithiyanathan, head of the Consumer Business for Maxis.
 
“Traditional contracts force customers to be ‘locked in’ to a fixed plan for 24 months, and charge you outrageous penalties for changing plans or early termination,” he added, in an apparent criticism of the company’s previous (and industry-wide) practice.
 
“With Zerolution, you can walk into our stores without a single sen, walk out with a brand new phone, and change that phone every year – all without being trapped in a 24-month contract,” he added.

In an example provided by Maxis on its website, the upfront cost of RM2,099 for a Samsung Galaxy S6 edge smartphone would now be converted into RM156 per month, paid along with the monthly postpaid bill.
 
This includes RM111 for the phone itself, an RM15 charge for device protection (reduced from RM29 previously) and a RM30 for a ‘new phone every year’ or early upgrade fee.
 
Within 12 months, the customer would have forked out RM1,872 for the device, compared to RM2,447 previously. At that point, the subscriber returns the old phone in good working condition, and upgrades to a new one.
 
The remaining 12 monthly payments will then be waived as the customer goes into a new Zerolution billing cycle.
 
Subscribers enrolled in this programme should remember to upgrade their handsets after 12 months, otherwise they would be paying the early upgrade fee for nothing.
 
Customers can also choose not to pay the early upgrade fee. They will benefit from the Zero Cash Upfront plan but not the early upgrade scheme, and as such, will need to complete the 24 monthly payments made up of the price of the phone and the device protection fee.
 
Should the subscriber opt to cancel the contract at any time, he or she would need to pay the remaining balance of the phone which is calculated as RRP/24 x remaining months, where RRP is the recommended retail price.
   
In the above case, if the customer wishes to cancel after 12 months, the balance is calculated as RM2,099/24 x 12 which equates to RM1,049.50.
 
Unfortunately for this customer, there is no refund for the early upgrade fee, which means that the RM360 would be wasted if the plan was cancelled after just a year. This clearly incentivises the customer to upgrade to a new handset and stay on with Maxis.
 
Aside from this, Maxis also rejigged its MaxisONE postpaid plans to offer unlimited voice calls and SMS across all tiers, as well as unlimited data access to Facebook, WeChat, WhatsApp and Line chat applications.

Starting at RM98 per month, the four MaxiONE tiers will be primarily differentiated with the amount of mobile data attached, offering 1GB, 3GB, 5GB and 7GB bundles, with the highest option priced at RM188 a month, exclusive of GST.
 
Subscribers to the highest tier plan will enjoy an additional 1GB of data for the first six months, bringing it to 8GB in total.
 
Related Stories:
 
Maxis revamps pay per use data rates
 
Maxis likely to face challenges in near-term, say analysts
 
redONE winning the postpaid war against the Big 3
 
Slugfest: Malaysia’s Big 3 mobile operators’ FY 2014 performance
 
 
For more technology news and the latest updates, follow us on Twitter, LinkedIn or Like us on Facebook.