New Approach to Mobiles

I’ve started to change my views on what a mobile phone is and how I should pay for it. Part of my more formulated thoughts on it were shared a few months ago when I mentioned that I didn’t feel excited about any new phones on the horizon.

My Orange contract was ending sometime in November, so I was faced with a question of how to proceed. I felt that a new phone wasn’t really required as I wasn’t going to get any significant benefit from it compared to my current device.

However, Orange messed around a little bit. I had some loyalty discount on my contract so I got a free HTC Desire on an 18 month contract with 600 mins, 500 or unlimited texts (can’t remember which) and 500MB of data for £20pm. However, although it was an 18 month contract, it turns out the loyalty discount was also only for 18 months, and it was a different 18 months! It started about 4 weeks before my new contract started as I upgraded 4 weeks before the end of my previous contract.

My loyalty discounts ran out and I dropped to 300 mins and 500MB of data for £30pm! So I was spending more, for less, without knowing. Orange did deal with it – they refunded my bill down to the £20pm that I was previously on.

However, they were not prepared to give me that deal moving forward. The best they could do was a sim only contract for 600 mins and 500MB for £21 a month. In other words, £1 a month more to get the same thing I’d had for 18 months, and I got a free phone out of it!

More than anything, the principal rubbed me up the wrong way. I decided to check out giffgaff. Flexible pricing, no contracts and reasonably priced.

Callum then told me about Free. A mobile company in France offering unlimited calls to France, unlimited to calls to landlines in 40 countries, unlimited texts, unlimited MMS and 3GB of data for €20 a month!

This struck a cord with me. The value of the service is really not that high, but mobile companies are inflating the price of it – they are controlling supply and potentially controlling prices. If giffgaff can buy usage from o2 and sell it cheaper than o2 can – then o2 are overcharging!

So, I no longer feel I ‘need’ a new mobile every 12/18/24 months, and the best deals are without a handset – why not separate the two!?

The phone that most interests me is the Galaxy Nexus. Best deal is on three who charge £40pm for 2000 mins, unlimited texts and unlimited data. However, with giffgaff, I can get the same but with 800 mins for £20 a month, or with 1500 mins for £25 a month. Over the mandatory 24 month contract, that puts the phone price at £480 (24 x £20) if I only need 800 mins or £360 (24 x £15) if I’m happy with 1500 mins.

You can buy the device on Amazon from Amazon for £470.

Sure, if I really want the 2000 mins, then it’s better value to go on three, but if I want to be more flexible and buy devices as they suit me and not be tied into a contract – then the split option is ideal. giffgaff also allows you to increase/decrease your cost every month, so if I feel I’m not using the 1500 mins and want to go down to 400, I can go down to £15 a month.

Also, if I really want to, you can find the phone on eBay for under £400.

To conclude. I feel that by changing the way I think about a phone and my usage, and by splitting the two, I’m able to get a much more flexible arrangement where I can pick and choose what I want, when I want, and it won’t cost me that much more.

UPDATE: And then, the next day I found out about T-Mobile offering 2000 mins, unlimited T-mobile calls, texts and data for £36 a month! And… they say that includes tethering and voip calls!

I suspect this may be a response to three’s offering, and I hope we see the other carriers following suit and offering similarly competitive options.

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