Thursday, December 2nd, 2010
Following on from my Getting The Best Deal On Your Next Phone, here is my first comparison chart that shows the total cost of ownership for two of the latest phones.
The idea behind these charts is to compare the tariffs for two popular phones with similar specifications. For the first one I thought I’d put the two heavyweight smartphones against each other – the HTC Desire HD and Apple’s iPhone 4.
The table below will probably look a little confusing and at first glance not make a lot of sense, but I’m going to run through each section in turn so that you can understand exactly what each section means and why you should care about it. It might take a couple of reads, but trust me, it’s worth it!
If you want to take a look at the table in full, you can download an excel version, where you’ll be able to tweak it depending on the deals that you find when you start shopping around for your next phone.
On the table below, the top two sections are for the HTC Desire HD, the bottom two sections are for the 16GB iPhone 4.
How this works
Contract length, Line Rental and Handset cost.
These three rows are all pretty straight forward. To keep this chart as fair as possible, these prices are all based on the current prices listed on the network websites and are correct as of today (2nd Dec). The only exception is the Desire HD on O2, which is not currently available direct, but is available through Carphone Warehouse.
Minutes, Texts and Data.
Again, they’re fairly straight forward, but it’s worth pointing out that most networks now offer a number of different tariffs at the same price point. To keep this comparison as fair as possible, I’ve opted for tariffs that give similar allowances. You may find with some networks that you can pay the same line rental, but get less free minutes/texts, but in return you’ll pay less for the phone.
Most tariffs now include unlimited text messages, this is subject to a fair usage policy though which in most cases caps the number of free text messages at 3000. For that reason any unlimited text tariff will have the number of texts show as 3000.
Data allowance is quoted in MB, 1000MB is about 1GB.
Effective Cost Per Month
This is where it may start to get a bit confusing. The Effective Cost Per Month is the fairest way to compare how much each option will cost you each month. The Effective Cost Per Month is calculated by adding up the total cost of your line rental and the handset cost, less any cashback from sites such as Quidco or Topcashback and any special promotions from the networks. You can see all of these costs by downloading an excel version of the chart.
The Effective Cost Per Month is colour coded either green or red, this is to show you which works out to be the cheaper option – either the 18 or 24 month contract.
It’s not always easy to look at a set of tariffs and work out which ones are good value for money, so that’s where this figure will help you. To determine the value figure I awarded points to each tariff for every minute, text and MB of data that you get. I then divided this number by the total cost of ownership to get a value for money figure. To a certain extent, how this is calculated doesn’t matter too much as no matter how it’s calculated the result is the same. What is important though is that the lower this number is the better as it means you’re getting more for your money.
Green tariffs are good value for money, orange tariffs are ok, but nothing special, and red ones should be avoided at all costs!
So Which is the best deal?
There’s no definitive answer to this question, but what the chart should help you decide on is which networks are worth spending more time looking at and which ones to avoid. It should also make it clearer to see which phone has the better offers on.
Sim Free HTC Desire HD
If the deciding factor was cost, The Desire HD would be the clear winner as it has a lower Effective Cost Per Month (which means it’s cheaper to run), a better value for money rating (which means you’ll get more minutes, texts and data for less money) and it has lower up front costs.
Download and Experiment
If you understand all that and want to have a play with the spreadsheet yourself, feel free to download a copy of it in XLS format. There’s a bit less colour coding on it and you’ll notice that there are also a few extra rows in each table. I won’t go into detail on what these are on here, but you’ll find explanations on the first tab of the spreadsheet.
If you have any questions or want me to put one of these together for any other phones, let me know using the comments section below or message me on twitter.
Tuesday, November 30th, 2010
Choosing your next mobile phone is never an easy task and with so many great phones around that all have very similar features, deciding on the exact model may boil down to what it’s going to cost you.
I spent many years working for the biggest mobile phone retailers in the UK and know tariffs inside out, so for me, choosing a new tariff is easy, but with so many options now available making the right choice can be incredibly hard if you’re not that familiar with how the networks, tariffs and contracts work.
To try and make it easier for you to get the right package, we’re going to do some of the hard work for you. Each month we’ll be compiling information from all of the main UK networks to show you just how much your next phone is likely to cost you.
We’ll give you some hints and tips on how you can bring your bill down, compare the networks for the most popular handsets and tell you about any great deals that we find online. I want to stress though that we’re doing this purely to help you out. We don’t make any money or earn any commission from any networks by sharing this information with you.
There is quite a lot of information here, so you may want to bookmark this page and come back to it as and when you need to. This post covers:
Before you start shopping:
Everyone gets excited when it’s time for a new phone, but rushing out to the retail parks and signing up for the first deal that you see is the worst thing you could do. Even independent dealers that offer multiple networks will still steer you towards the deal that is best for them rather than what’s best for you, so shop around. Check both the independent retailers and the network stores – and remember, you’ll often find different deals online to what you’ll find in the stores.
It’s worth looking at your last 3 months bills too. This will give you a good idea on how many minutes, texts and picture messages you’re using each month. Most networks should also let you know how many MB of data you’re getting through each month too. If this isn’t shown on your bill give your network a call and ask them. Data usage could make a big difference to the tariff you choose.
Choosing your phone:
Often your friends will tell you to go and get a certain model of phone, normally their recommendation will be the most impartial opinion you’ll get. Friends won’t tell you to get a bad phone, and if they do, maybe they aren’t your friend after all!
To avoid any problems get to a store and go hands on with a phone before you sign up to anything. Most shops now have live handsets on display that you can play with, and familiarise yourself with. There’s nothing worse than blindly signing up to a lengthy contract, only to find that when you get the phone home a key feature is missing or that you can’t work out how it works – especially as most networks don’t allow you to return a phone.
Try to put a short-list together of potential handsets. There may be two handsets that are equally matched in specification, but the deals on them may be significantly different. The HTC Desire and Samsung Galaxy S are a great example of this. Both phones are very similar, but you’ll often find a better deal on the Galaxy S than you will on the Desire, for no reason other than the Desire came out first and is well known. If you’re not too clued up on phones, websites like GSMArena are a great place to go to find out and compare specs on handsets.
Coverage is not so much of an issue now as all networks are just about as good as each other, however, there are localised black spots that can cause misery if you don’t know about them. Thankfully though, the networks coverage maps are available on their website and make it pretty easy to see what’s going to work where you live. Spend some time checking area’s where you are likely to use your phone to make sure that the signal is sufficient.
If you’re looking at getting a smart phone such as the iPhone or HTC Desire HD, it’s not coverage that you’ll want to compare, but the type of coverage that you’ll get. Without getting overly technical there are generally 3 types of coverage available, each one will provide you with different speeds when you’re accessing the internet on your phone.
- 2G/GPRS – Slow. This will give you internet speeds comparable to dial up internet. It’s enough for calls, but if this is all your network is offering, look elsewhere.
- 3G – Moderate. This is the minimum level of coverage that you should be looking for. Internet will be reasonably fast. Again, if you aren’t in a 3G area by now, switch to another network.
- 3G+/HSDPA – Fast. This is the best coverage that you can get, but it hasn’t been rolled out everywhere yet.
Don’t forget that there are more than just 5 networks in the UK now. Most supermarkets now offer their own mobile services and can undercut the big 5 by a fair amount. The handset choice is often limited, but coverage is just as strong as they all piggy back off one of the big networks. Tesco use O2′s network, Asda use Vodafone’s and Virgin use T-Mobile. If you have landline, TV or broadband with Virgin, you’ll normally get an extra discount if you take out mobile services with them too.
To check the coverage for each of the networks, you can use their coverage maps on their websites.
Be Prepared if you want to keep your number:
The biggest stumbling block to people taking out a new contract is their phone number. Not many of us want to keep changing our phone number, so before you go shopping, call your network and ask them for your PAC code. It’s important that you ask for your PAC and not your PUK. These codes sound similar but are very very different!
You’ll need to call your network to request the PAC code. Network stores on the High Street are generally unable to provide them. When faced with the never ending list of automated options, choose the one for “If you’re thinking of leaving”. You don’t normally have to wait too long, but you may have a challenge on your hands to actually get the code out of the operator.
The department you’ll be put through to is called retentions, and their sole mission in life is to prevent you from leaving the network. While this sounds like a bad thing, it can often work in your favour as they can often offer deals that no one else can, but the options are sometimes limited.
It pays to have done some shopping around before you call them as they will often ask which network you’re going to and what deal you’re getting. In most cases, they will at least match if not better the deal. If you’re happy with your network, this is a great way of playing the system and getting a better deal out of them than you would have if you’d just upgraded normally.
Remember though, requesting your PAC code doesn’t commit you to anything – if it isn’t submitted to another network with in 30 days, it will expire and your contract will continue as normal. If you’re not sure that the deal that they’re offering is right for you don’t worry. You don’t have to sign up to it there and then despite what they say. You can always take the PAC and then call them back at a later time to accept any deals that they’ve offered.
Free Gifts & Cashback
All that’s left is to find the best deal for you out of the thousands that are available. Network websites are great for finding out about the tariffs, but you won’t always get the best deal from them. Independent retailers will often offer some kind of incentive for you to take out the contract with them, this could be in the form of a free gift, cashback or discounted line rental. Beware though, there is often a catch, especially with cashback offers. With my time in retail I dealt with hundreds of cashback deals, most went through smoothly and without any problems, but there are occasional problems.
Free gifts can be tempting, but don't always give you the best deal
Most cashback or discounted line rental deals are ‘by redemption’. This means that you have to pay the full rate each month and then send off to apply for the money back. If you’re going with a well known high street retailer, you shouldn’t have a problem with this kind of offer, as long as you send them the appropriate bills when you’re supposed to. If you’re slow sending them off or they go missing in the post you may miss out though, so make sure you mark the dates on your calendar and always send your paperwork off to them using recorded delivery.
Some retailers now offer an automatic cashback – this just means that you’ll get your cheque without having to do anything, but it comes at a price. As the retailer can’t rely on people forgetting to apply for their refunds, the amount that they pay out on these kinds of deal is normally considerably lower than it is on a standard redemption deal.
Free gifts are normally a bit more straight forward than a cash back deal, although you normally have to wait a while before you get your freebie. Always shop around when it comes to free gift deals though and do some maths before signing. Often it can work out a lot, lot cheaper to go for a cashback deal than it would be to get the free gift. For example:
On e2save, the Samsung Tocco Lite on O2 is available for a one off cost of £8.81, with a free Playstation 3 Slim worth £249 on a £25 tariff offering 300 minutes and unlimited text for 24 months. The same phone/tariff combination with the same retailer is available with a £350 cashback deal – that would save you over £100.
In addition to cashback from the networks, there is another way to earn cash back when you buy a new phone, and that’s through cashback websites such as Quidco.com or topcashback.co.uk. These websites are a great way to save money when shopping online. The way that they work is that online retailers pay them a commission for every sale that they refer to them. Quidco then pass some of this commission on to you. Depending on the retailer, this can be a small percentage of the order value, or in the case of mobile phone and utility companies, it can be hundreds of pounds.
Quidco cash back for e2save is currently £46 cash back for a completed Pay Monthly phone contract and £60 cash back for a completed Pay Monthly phone contract that has a free gift. This cash back is always in addition to what ever the retailer is offering. Using the same example the deals would work out to be:
||Cash Back (Redemption)
||Cash Back (Auto)
|Value of Free Gift
|Cash Back from Retailer
|Cash Back from Quidco*
*cashback amounts are subject to change and exclude any membership fee deductions.
Time for a New Phone
If you’ve done your homework and checked everything listed above you’re now in the perfect place to go shopping for a deal. By now you should;
- Know which networks will/won’t work for you
- Know which handsets you would be happy with
- Have your PAC code (if you want to keep your number)
- Know how many minutes, texts and MB of data you need
- Know who’s offering the best deals and cash back
Over the next few weeks I’ll be looking at some of the most popular phones and compiling a Total Cost of Ownership chart for each of them to give you a better idea on the costs involved. I’ll keep an eye out for some of outstanding deals and will post details on where you can find them.
The first comparison chart should be available later this week and will compare the HTC Desire HD and the iPhone 4.