What is a data plan?


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What is a data plan?

A couple relaxing with their computer and mobile phone

What's coming up

In this activity, you'll learn what a data plan is, how it works, and how you pay for it.

You'll also find out how data forms the basis of the cost of your whole internet service.

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You always use data

Whenever you use the internet with your mobile phone, tablet, computer or other device, you use at least some amount of data. Everything you do on the internet requires data, from a simple web search, to watching a movie, and everything in between.

Some things use a lot of data – like watching movies – and some things use only a small amount of data – like reading a news website.

Everything you do on the internet uses data
A smartphone showing 75% of data has been used this month

How is data measured?

We measure water in litres, and we measure power in watts. The term we use to measure data is gigabytes. The word 'gigabytes' is often abbreviated to 'GB' when writing to make it easier. We pronounce ‘gigabytes' like this:

Gig – ah – bites

How data is sold

Internet providers offer monthly plans, at a set cost. This monthly fee includes a certain amount of data, or a certain amount of gigabytes. For example, a home internet plan that costs $50 per month might include 200 gigabytes (GB) of data, but a mobile data plan that costs $30 per month might include 5 gigabytes (GB) of data.

As you will notice, home data is cheaper than mobile data.

A comparison between how much data you get on a home internet plan vs a mobile internet plan
A diagram showing how much data has been used from a total of 200GB

Using less data

If your monthly home data allowance is 200 gigabytes, and you finish the month having only used 80 gigabytes, the remaining data is forfeited. You still have to pay the full amount of your internet plan, even if you don't use all of the data allowance.

This is the same for most mobile data plans – if you don't use up all your data in a month, you still pay the full amount and you lose any data you didn't use. The next month, you start with a fresh amount of data to use.

Using too much data

If your monthly home data allowance is 200 gigabytes, and you use up the full 200 gigabytes before the end of your billing month, you will run out of data. If this happens, some internet providers will charge you extra for the data you use on top of your allowance.

Some other internet providers will slow down your internet for the rest of the month, so you can't keep using up so much data.

You can choose to ‘top up' your data and pay for extra. Talk to your internet provider about this.

A diagram showing that 120% of data has been used this month
A breakdown of a monthly household budget

Controlling your bill - home internet

A home data plan doesn't cost less if you use less than your allowance, but it will cost more if you use extra data. Still, a data plan can be a good way to help control the cost of your internet.

Unlike electricity or gas, your internet bill should be the same every month, which lets you plan ahead.


eSafety Tip

Keep an eye on how much data you use on your mobile and home plans. You can do this through an app (short for 'application', which is a small computer program for mobile devices) from your provider. Ask them to help you download the app and use it in order to check your data usage.

Controlling your bill – mobile data

If you reach your data allowance, some mobile internet providers will automatically give you more data, but will charge you for this. Again, talk to your mobile internet provider about making sure this doesn't happen.

A diagram showing options for data on a mobile data plan
A comparison of how much data costs on a monthly data plan

Home and mobile data plans

A mobile data plan is similar to a home data plan, in that you get a set amount of data a month, and you are charged extra if you use more data, but not less if you use less.

A mobile data plan, however, provides far less data for more cost. A large mobile data plan, for example, might provide 50 gigabytes for $60, but some home data plans provide unlimited data for the same cost.

Well done!

This is the end of the What is a data plan? activity. You've learned that internet providers set the cost of a home or mobile internet plan based on how much data is included.

Using less than the allowed amount is fine. But if you use more data than allowed, you might have to pay a surcharge, or have slow internet for a little while.

Up next, you'll learn about internet contracts, in the Getting a data plan activity.

Someone sending emails on their laptop computer