Is it cheaper to buy an iPhone outright with a SIM-only plan?

Summary: Tech types sing the virtues of buying iPhones outright and grabbing a SIM card from your favourite telco, but is it actually cheaper in the long run to buy yours this way?

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Whether it is cheaper to buy an iPhone upfront, through Apple itself, or to sign on to a telco plan is a long-running debate among techy types.

Last year when we asked this question, we came to the conclusion that it is cheaper over 24-months to buy an iPhone on a telco contract, but that it was better value to buy it outright and choose one of the numerous SIM-only plan options.

In the past 12-months, a lot has changed. Many of the network resellers have decreased the value in plans, specifically data, and the telcos are subtly reducing the subsidies they offer for phones on plans. In short, it’s anyone’s game for iPhone 6, so let’s break out the calculators.

To make this comparison, we’ll use the iPhone 6 16GB and iPhone 6 Plus 16GB. Included plans must offer at least $650 worth of calls and unlimited SMS, plus at least 1.5GB data — the average data inclusion for plan searches on the WhistleOut engine.

Telco Plans incl. handset repayments - over 24-months

Plan Inclusions iPhone 6 iPhone 6 Plus
Vodafone $70 Red Plan Unlimited Calls/SMS + 3GB Data $1776 $1896
Virgin Mobile $60 Plan $700 Calls + 4GB Data* $1776 $1896
Optus $60 Plan Unlimited Calls/SMS + 2.5GB Data $1896 $1992
Telstra $70 Plan $700 Calls + 2.5GB Data* $1944 $2064
*Includes bonus promotional data

Monthly Plans plus outright phone cost - over 24-months

Plan Inclusions iPhone 6 iPhone 6 Plus
AldiMobile ($35) Unlimited Calls + 2GB Data $1709 $1839
Jennee Mobile ($35) $650 Calls + 3GB Data $1709 $1839
Spintel ($36 + $25 setup) Unlimited Calls + 3GB Data $1758 $1888
Boost Mobile ($40) Unlimited Calls + 2GB Data $1829 $1959
Amaysim ($44.90) Unlimited Calls + 5GB Data $1947 $2077
Vaya ($57) Unlimited Calls + 3GB Data $2237 $2367
Live Connected ($60) Unlimited Calls + 3GB Data $2309 $2439
Telechoice ($69) Unlimited Calls + 3GB Data $2525 $2655

We have a winner?

No, not really.

In stark contrast to last year's results, there is very little difference between the cheapest On-Plan options and the cheapest BYO-phone options.

Virgin comes out on top in the contract wars with the best deal in terms of price and value. Adding 2GB of data to all plans, and not just high-cost plans (like Optus has done), should prove to be a meaningful incentive for the data-hungry iPhone crowd.

Aldi, Jeenee and Spintel hold their own well on price and inclusions alone, but miss out on key benefits offered by the big telcos. For example:

  • Both Telstra and Optus now offer data sharing on post-paid plans, which is great if you also own a laptop or a mobile broadband modem.
  • Vodafone's Red Plans include international calling credit and $5 per day international roaming for travellers.
  • For the super keen Apple fans, Telstra's New Phone Feeling bonus will let you upgrade from the iPhone 6 to the iPhone 7 for free on $70 plans or higher.

On the flip side, buying the iPhone outright means you maintain the freedom to switch to a different carrier at any time, which is a benefit many would pay extra for. This year, there isn't a significant premium on this freedom, in fact, you will actually save a few dollars by choosing one of the cheaper providers.


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