Revealed: The true costs of BYOD

You think letting your staff use their own smartphones and tablets is going to save you money? It might be time to think again.
Written by Nick Heath, Contributor on

BYOD won't save companies money. In fact, subsidising staff smartphones and tablets works out as a bad deal for both the business and the individual.

Companies going full BYOD and buying staff devices to use at work and home will generally face far greater costs than just supplying work devices, the Ovum BYOX: World Forum 2013 in London heard.

The BBC's head of IT strategy and policy, Paul Boyns, provided a rough breakdown of how much it could cost to give staff money to buy a personal and work device. "If we wanted to give them £500 the overall cost to us is about £700 by the time you take into account the efficiencies that we've lost, and they only get about £300 of it," he said.

Costs would be incurred in several areas: fresh tax liabilities, higher tariffs on consumer data and voice plans and subscription costs for mobile device management (MDM) software.

Consumer tariffs for voice and data for mobile devices can cost up to five times the price of corporate tariffs, according to Richard Absalom, senior analyst for consumer impact with Ovum — which means that letting staff claim expenses for charges on these personal tariffs "can easily negate any savings on the hardware".

Absalom said that swapping between personal and corporate SIMs was one possible but inelegant way around this problem, as was having more than one phone number registered to a single SIM card, as enabled by companies such as Movius.

He said staff and companies also faced additional tax liabilities from the full BYOD model. Under UK law, staff receiving money for, or being given, a device to be used outside the office would need to pay income tax on the value of the device or the amount of cash they are given.

"If they were on a 50 percent tax bracket then they would have to pay $500 if they were given a $1,000 device," Absalom said.

If the employee was given cash, both they and their company would also have to pay national insurance contributions; if the employee was given a device, just the company incurred additional national insurance charges. The staff member who was given the device would also become liable for declaring it as a benefit in kind to the tax authorities.

In addition, he said, the average MDM subscription cost between $3 and $7 a month. As employees often had more than one device, it often made sense to consider an MDM package that was licensed per user rather than per device,.

Support costs could go up due to internal helpdesk staff training to support a far wider range of devices, or down due to staff being more willing to resolve problems themselves, and with their peers, on a machine they perceived as their personal device.

It's still relatively rare for companies to reimburse staff for the cost of buying a shared personal and work device, with only 18.1 percent of staff surveyed by Ovum saying their company refunds the cost of such a machine. Where companies did stump up the funds the majority offered no more than $500.

In spite of a prediction by analyst house Gartner that half of companies may impose BYOD on staff by 2017, it seems most companies are focused on making it safer and easier for staff to use their existing personal devices at work rather than funding a BYOD scheme.

"We can't see subsidies working for us financially. If staff want to bring in their own device at the moment that's something we're helping to enable but we're not saying 'Here's some cash'," the BBC's Boyns said.

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