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


WhistleOut
15 September 2016

We’re often asked whether it’s cheaper to buy a smartphone on a contract plan, or outright with a BYO phone SIM card — especially whenever Apple announces a new iPhone. Many assume that buying a phone on a contract gets you the biggest savings, thanks to telco handset subsidies, but a spate of competitive, data-packed SIM only options means the choice is trickier than it’s ever been.

To answer this question, we’ve taken a close look at both the new 32GB and 128GB iPhone 7 models and compared the price of buying the phone on a 24 month contract to the cost of buying it outright and taking up a comparable non contract plan from the same provider. We then compared the cost of buying the iPhone 7 outright and taking up 24 months of service from a BYO phone option such as Amaysim, Vaya and Aldi Mobile. 

For the record, the results are pretty similar when comparing prices for the iPhone 7 Plus, too.

Telstra

iPhone 7 32GB Data Inclusion Monthly Fee Repayments Outright Cost Total Cost Over 24 months
On Contract 3GB $75 $19 N/A $2,256.00
Outright  5GB $50 N/A $1,079 $2,279.00
On Contract 10GB $95 $4 N/A $2,376.00
Outright  10GB $70 N/A $1,079 $2,759.00
iPhone 7 128GB Data Inclusion Monthly Fee Repayments Outright Cost Total Cost Over 24 months
On Contract 3GB $75 $29 N/A $2,496.00
Outright  5GB $50 N/A $1,229 $2,429.00
On Contract 10GB $95 $18 N/A $2,712.00
Outright  10GB $70 N/A $1,229 $2,909.00

Optus

iPhone 7 32GB Data Inclusion Monthly Fee Repayments Outright Cost Total Cost Over 24 months
On Contract 1GB $40 $28 N/A $1,632.00
Outright  1.5GB $35 N/A $1,079 $1,919.00
On Contract 7GB $85 $2 N/A $2,088.00
Outright  6GB $50 N/A $1,079 $2,279.00
iPhone 7 128GB Data Inclusion Monthly Fee Repayments Outright Cost Total Cost Over 24 months
On Contract 1GB $40 $42 N/A $1,968.00
Outright  1.5GB $35 N/A $1,229 $2,069.00
On Contract 7GB $85 $15 N/A $2,400.00
Outright  6GB $50N/A $1,229 $2,429.00

Vodafone

iPhone 7 32GB Data Inclusion Monthly Fee Repayments Outright Cost Total Cost Over 24 months
On Contract 1GB $40 $36 N/A $1,824.00
Outright  1.5GB $35 N/A $1,079 $1,919.00
On Contract 11GB $90 $6 N/A $2,304.00
Outright  11GB $60 N/A $1,079 $2,519.00
iPhone 7 128GB Data Inclusion Monthly Fee Repayments Outright Cost Total Cost Over 24 months
On Contract 1GB $40 $45 N/A $2,040.00
Outright  1.5GB $35 N/A $1,229 $2,069.00
On Contract 11GB $90$13 N/A $2,472.00
Outright  11GB $60 N/A $1,229 $2,669.00

Virgin

iPhone 7 32GB Data Inclusion Monthly Fee Repayments Outright Cost Total Cost Over 24 months
On Contract 1GB $40 $26 N/A $1,584.00
Outright  1.5GB $30 N/A $1,079 $1,799.00
On Contract 15GB $100 $0 N/A $2,400.00
Outright  15GB $80 N/A $1,079 $2,999.00
iPhone 7 128GB Data Inclusion Monthly Fee Repayments Outright Cost Total Cost Over 24 months
On Contract 1GB $40 $40 N/A $1,920.00
Outright  1.5GB $30 N/A $1,229 $1,949.00
On Contract 15GB $100 $5 N/A $2,520.00
Outright  15GB $80 N/A $1,229 $3,149.00

Amaysim

iPhone 7 32GB Data Inclusion Monthly Fee Repayments Outright Cost Total Cost Over 24 months
Outright  1.5GB $24.90 per 28 days N/A $1,079 $1,751.30
Outright  7GB $39.90 per 28 days N/A $1,079 $2,156.30
iPhone 7 128GB Data Inclusion Monthly Fee Repayments Outright Cost Total Cost Over 24 months
Outright  1.5GB $24.90 per 28 days N/A $1,229 $1,901.30
Outright  7GB $39.90 per 28 days N/A $1,229 $2,306.30

Woolworths

iPhone 7 32GB Data Inclusion Monthly Fee Repayments Outright Cost Total Cost Over 24 months
Outright  3GB $30 N/A $1,079 $1,831.00
Outright  8GB $45 N/A $1,079 $2,206.00
iPhone 7 128GB Data Inclusion Monthly Fee Repayments Outright Cost Total Cost Over 24 months
Outright  3GB $35 N/A $1,229 $1,981.00
Outright  8GB $45 N/A $1,229 $2,356.00

Aldi

iPhone 7 32GB Data Inclusion Monthly Fee Repayments Outright Cost Total Cost Over 24 months
Outright  2GB $25 N/A $1,079 $1,679.00
Outright  8GB $45 N/A $1,079 $2,159.00
iPhone 7 128GB Data Inclusion Monthly Fee Repayments Outright Cost Total Cost Over 24 months
Outright  2GB $25 N/A $1,229 $1,829.00
Outright  8GB $45 N/A $1,229 $2,309.00

Kogan

iPhone 7 32GB Data Inclusion Monthly Fee Repayments Outright Cost Total Cost Over 24 months
Outright  1GB $16.90 N/A $1,079 $1,484.60
Outright  8GB $36.90 N/A $1,079 $1,964.60
iPhone 7 128GB Data Inclusion Monthly Fee Repayments Outright Cost Total Cost Over 24 months
Outright  1GB $16.90 N/A $1,229 $1,634.60
Outright  8GB $36.90 N/A $1,229 $2,114.60

Vaya

iPhone 7 32GB Data Inclusion Monthly Fee Repayments Outright Cost Total Cost Over 24 months
Outright  1GB $16 N/A $1,079 $1,463.00
Outright  8GB $36 N/A $1,079 $1,694.00
iPhone 7 128GB Data Inclusion Monthly Fee Repayments Outright Cost Total Cost Over 24 months
Outright  1GB $16 N/A $1,229 $1,613.00
Outright  8GB $36 N/A $1,229 $1,844.00

So is it cheaper to buy outright?

While you can still save money by buying on a contract, the savings might not be as significant as you might think. In some cases, you're only saving $20 on a two year contract compared with the total cost of a comparable contract-free plan on the same provider. 

In other cases, you can save as much as $600.

If you really want to save money, buying an iPhone outright and picking up a SIM from a provider such as Vaya, Amaysim, or Aldi Mobile is a very affordable proposition.

Not having a contract means you're free to come and go as you like, and step up or down in plan size on a monthly basis, according to your usage. It also means you're able to take up better value deals as they come around. Given how competitive the local telco scene has been in the past few years, we're only going to see data per dollar climb higher and higher.

Of course, buying outright does mean you need to plonk down over $1,000 in one go to buy your phone, which isn't always as palatable as a comparatively low monthly fee. Telcos are also increasingly throwing in bonuses to customers who sign up for a 24 month contract. 

With Optus, you can get a free subscription to the English Premier League. On Telstra, you can get as much as 12 months of free Apple Music, NRL and AFL Footy Season passes, and three free months of access to Netflix, Stan, and Presto. Vodafone gives you the choice of 12 months of free access to either Stan, Spotify, or the Sydney Morning Herald. Not all of these inclusions will be attractive to everyone, but they're worth considering if you're using these services. For example, if you're an avid Stan subscriber, you can save yourself $120 with a Vodafone contract. 

Even if you're not after a new iPhone, it's worth considering the pros and cons of buying a smartphone outright as opposed to on contract. If you're happy to bear the upfront cost, you can almost certainly save money by going with a SIM only offering from the likes of Amaysim, Vaya, Kogan, Aldi Mobile, or Woolworths. At the same time, many 24 month contracts work can still work out to be great value, provide nifty bonuses, and offer a much more manageable way of dealing with a big purchase.

Click here for all Australian iPhone plans.



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