Optus has quietly axed its leasing plans, freeing the Australian telco industry from phone contracts where you don't actually own your phone. An Optus spokesperson told us today that this move was made in order to simplify the company's plan offering.
Optus' leasing plans were similar to its 24-month contracts, except that you had to return your phone at the end the term. These plans typically mirrored Optus' main range, but were $10 cheaper per month. Essentially, you saved $240 over the course of your contract, but didn't own your phone.
If you're currently on an Optus leasing plan, you have a few options based on how far you are through your plan:
If you're still in the first year of your lease and want to upgrade, you can recontract to a new leasing plan. You will however pay a cancellation fee and all remaining monthly device charges. This does mean you will own the phone you were leasing, however.
If you're in the second year of your lease, you can trade up to a new phone on a 24-month contract for $99. You will however have to return the phone you're leasing. If the phone isn't in good working order, you'll pay a damage fee of up to $499.
If you're at the end of your lease (after 24 months), you will need to return your phone to Optus or buy it at "fair market value", which will be advised at the time. If you choose not to buy the phone and it isn't in good working order, you'll pay a damage fee of up to $499. If you're deciding, you can continue the lease for up to six months by paying the monthly device charge and plan fee, but we'd advise against this.
Optus' decision to remove its leasing comes around a month after Telstra did the same thing as part of its big plan restructure. Vodafone never offered leasing plans.
On the whole, we see this is a good thing for consumers. More often than not, leasing plans simply didn't represent good value, as a saving of $240 across two years isn't enough to offset not owning a phone you've spent 24 months paying for. Especially given that most flagship smartphones tend to have a much higher resale value on the second hand market, even after a two-year stretch.
Alex Choros
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