iPhone 4 price comparisons

Each time Apple releases a new iPhone I ask myself is buying it on contract the wise thing to do? If you are in the USA you have no choice it is AT&T signing your life away for 2 years: End Of!

It used to be like that in the UK too, but with the iPhone 3GS PAYG was introduced and that changed the game. Still on O2 and the iPhone was locked to the O2 network. But then O2 lost its monopoly and other carriers got in on the act. The result is that with the launch of the iPhone 4 we will have 4 carriers available and the iPhone will be available both on contract and SIM free.

So with all these options available what is the best way to own an iPhone 4? Read on to find out…

Well firstly you have to make a decision about how long you want to own it! That may sound a bit silly, but if you are like me you will be wanting the iPhone 5 (or whatever) in 12 months time. This means that I will have to suffer a penalty for early upgrade (if they will allow it) or as I did last year take the hit and have another contract until the old one expires.

I have costed out the options below for the full term of the contract on the assumption that you will have to pay them. Ownership for more than one year will change the costings, but even so the SIM free option would still be just £679 with no ties for 18 months.

As you can see it gets complicated and there are quite a few decisions to be made. So lets start looking at a comparison of Contract and PAYG iPhones. I make the assumption that you will select the lowest voice tariff, as nobody buys an iPhone to make voice calls…

The table below is based on the 16Gb iPhone 4:

T-Mobile and 3 are yet to declare, but from the looks of things if you want an iPhone 5 then getting an iPhone 4 SIM FREE is the way to go.

In my case things are slightly more complicated.

I still have 6 months to go on my current O2 contract. I can get an early upgrade, but that will cost me £100 and I will then still have to pay £209 for the new phone on an 18 month contract. Then I have to pay for the airtime £540 total cost for me to upgrade to iPhone 4 is £849.

So what if I let my existing contract continue: SIM Free iPhone 4 £499, £30 a month for 12 months (with unlimited data as I am not changing the contract) Total cost £859 and I get to keep unlimited data and can upgrade to iPhone 5 for no penalty…

Or alternatively I can let my existing contract run out then switch to PAYG. SIM Free iPhone 4 £499, £30 a month for 6 months £180, £10 for 6 months £60 Total cost £739 and no ties.

Conclusion:
If you are looking to get an iPhone 5 next year and you dont talk a lot on the phone then which ever way you look at it PAYG works out best. If you have an existing iPhone 3GS contract with 6 months or more to go then things get more marginal. I suspect that I will be opting for the SIM Free and letting my contract run out.

Downsides are having to buy the iPhone upfront, but the upside is only being tied into a 12 month contract. And if you compare this with the Orange offerings on a like for like basis the Tescos option looks to be the smart choice, although the draw of not having to buy the iPhone upfront may be a win for Orange.

Decide for yourself. Tesco – Orange

Tesco is to sell iphone

Hot off the press is news that Tesco have joined in on the iPhone war here in the UK. On the Tesco Direct website confirmation of their move has already been made. It is suggested they will do both the 3G and the 3GS but nothing as yet on pricings.

It is also to be noted that this is a joint partnership with O2 so we could speculate that the rates will stay the same but if tesco history of price slashing is anything to go by we may see them set a president for Orange and Vodaphone to follow.

Let the wars begin?

Should be in before Christmas.