Split your smartphone bill -- but beware the risks

Hidden costs and technology limitations can vaporize your savings -- and breed unhappiness

Split your smartphone bill -- but beware the risks
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Wih employees doing work and personal activities on their smartphones and tablets, businesses fear they are subsidizing personal activity with their hard-earned revenues. Meanwhile, employees using their own devices suspect they're subsidizing their employers, who already get more productivity and availability from that mobile usage.

It's no surprise, then, that various service providers are offering split-billing services to figure out how much data employees use, to then figure out what portion of that data usage it should reimburse for personal (BYOD) devices, or what personal portion it should charge to employees using corporate (COPE) devices.

Be careful if you're considering such a service. They overstate the potential savings, and they can't determine the usage allocation as precisely as you might think. Plus, they incur their own costs.

The split-billing landscape

Split billing has been possible for a few years at some carriers (AT&T has been the most aggressive in the United States), but the employee and employer both had to use the same carrier, an unlikely reality given the prevalence of family plans that lock employes in to specific carriers regardless of their employer's carrier relationship.

But in the last year, changes in iOS and Android have let apps monitor data usage for the devices and, usually through the support for multiple, on-demand VPNs, monitor data usage through specific connections.

The mobile expense issue is hardly a new concern for IT, but it gained new impetus last year when a California court ruled that employers requiring employees to use their personal mobile devices for work must reimburse workers for the business portion of the cellular service. Despite what the mobile management industry would like you to believe, the court did not rule that optional usage had to be reimbursed -- only for required use. The court also did not set a formula for how to calculate reimbursement.

Syntonic is the best known of the split-billing services, and it has the advantage of not being tied to a specific mobile management provider. Movius also offers split-billing technology, both directly to enterprises and through cellular carriers. Good Technology acquired split-billing provider Macheen last year and last month launched its own service, but it is tied to its mobile management service.

Watch out for with split billing

Split billing may be a worthwhile idea for your company, but it could also be a waste of money or a morale -- and thus productivity -- killer.

The cost. Providers like Syntonic claim that companies pay $100 per month per employee, and they cite surveys that at least 70 percent of the usage is personal. Thus, they claim you could save $840 per year per employee by using their technology.

I'm sorry, but if you're reimbursing employees $100 per month for data service, something's wrong. A single-line plan with unlimited voice and text and 4GB of data costs $90 before taxes at AT&T, and a single-line plan at Verizon costs $75 for 2GB (its max for a single line). The per-user price for family plans drops by about a third.

You might have some salespeople or field staff who need that kind of cellular data usage, but you shouldn't be reimbursing everyone at that level. The real savings will be less than what the split-billing providers claim.

Also, you have to pay for the split-billing service, plus have your IT and accounting staff manage and analyze the records to calculate the reimbursements or bills, then handle the payments to or from each affected employee. This overhead will easily cost $10 to $30 per month per user. Your actual savings decline even further from what the providers claim -- and may even evaporate.

In today's world of data buckets rather than metered usage, the metered approach of split billing leaves a potentially contentious issue open: Who pays for the unused data in BYOD scenarios? After all, employees have to buy cellular data in chunks, and most people overbuy as a safety measure. They'll certainly do that if they know the device has to be available for work.

If an employee pays $40 per month for 2GB of data, uses 0.5GB for work (because they have Wi-Fi at the office, right?) and 1GB for personal, who pays for the unused 0.5GB? That's $10 in one month alone for one employee. Is that an argument you want to have?

The technology. These services have two ways to measure data usage, none of which is exact:

  • Measure the data traffic during specific hours. That means personal work done during those hours is counted as work usage, and work usage outside these hours is counted as personal usage. What fun it will be to address that!
  • Measure the traffic used by specific apps, either those that connect to the provider's server or those installed from a corporate app store rather than the Apple or Google app store. That leaves apps like the browser, social media, messaging client, email client, calendar client, and even office productivity apps in potential limbo, as they handle both work and personal accounts. Or it forces the user to have duplicate apps for such services, which becomes both a management challenge and a usability issue. (Android is better at handling dual applications than iOS is, but most businesses use iOS.)

In other words, the split-billing systems can only track approximations of usage. When you start issuing exact reimbursements or bills, expect that fact to come up as people scrutinize the reports.

The voice issue. These services can't track and allocate voice usage -- that is, phone calls. You could try to use a VoIP service for either personal or business use, so the phone calls are tracked as data, but the audio quality of these services remains poor.

For smartphones, anywhere from $20 to $40 of the monthly carrier cost is for the so-called access fees that pay for phone calls and SMS texts. How will you allocate that cost?

The simpler solution for most companies

There are undoubtedly companies that can wisely choose and deploy a split-billing service and manage it cost-effectively, to get savings without alienating employees. Also, other companies may have other auditing and compliance needs to invest in such technology, even if it imposes a cost or emotional toll.

But I suspect for most companies, split billing creates more problems than it solves, at least today. A better approach for them is to have an inexact reimbursement policy, where based on employee role, a certain stipend is provided. (I've outlined such a mobile reimbursement policy previously.)

After all, split billing is also inexact, though it pretends otherwise. However, its apparent precision will invite a lot of nitpicking when people see the reports. A clean set of reimbursement buckets won't invite that nitpicking.

Sure, you may overpay a little for some employees' use, but you will be in compliance with the California court ruling, you won't have the admin costs of a split-billing system, and you won't be providing supposedly exact figures for employees to second-guess. A savvy company will figure out the right reimbursement bucket breakpoints and end up financially even -- and not piss off its employees.

For those who really need strong separation for compliance or legal reasons, don't forget the old-fashioned approach: Employees get their own smartphones for their own use, and you provide them another one for work use. Today's thin, light smartphones make that less of a burden than ever.

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