Mobile customers losing £112 on the wrong contracts, according to new research from HandsetExpert.com
Mobile phone customers are losing out on average £112.86 by signing up to monthly contracts rather than opting for SIM Only deals, research from HandsetExpert.com shows.
The worst culprits are high-data tariffs which can leave users over £400 out of pocket for a 24 month contract.
Major new research, conducted by HandsetExpert.com, analysed a staggering 1,316,835 contracts available to UK customers for 50 different mobile phones across 13 different tariffs from 40 UK retailers and mobile operators.
The total cost over the course of the pay monthly contract was then compared with the cost of purchasing the phone without a contract (‘SIM Free’) and a comparable ‘SIM Only’ mobile phone contract separately.
Their main findings show:
- 77% of all mobile monthly contracts are more expensive than buying the same phone and taking a SIM Only tariff
- Lower-cost handsets purchased as part of a pay-monthly contract are significantly overpriced
- It is only monthly contracts with low-data and under 500 inclusive minutes which represent good value for the consumer
- The best deal on a monthly tariff – compared to a SIM Only - offers a saving of £86.00 over 24 months for a Motorola Moto X Style on Talkmobile from The Smartphone Company, looking at tariffs with 1GB data.
- The worst monthly deal which will cost the user an extra £400.97 is when getting the HTC One M9 on Vodafone from Mobile Phones Direct, looking at tariffs with up to 2000 minutes.
Dr Shahrum Gilani, who founded HandsetExpert.com so people could compare monthly contracts with SIM Only prices, said: “Our findings show the importance of shopping around. Buying a phone and SIM Only contract separately requires an initial upfront payment, but in the long run it can save a lot of money.
“Low-cost handsets on high-data tariffs are the worst offenders; there are often much higher value phones available on the same tariffs offering better value for money.
“The only area where consumers seem to get a good deal with a pay monthly contract is on tariffs with low data and talk allowance. Even here the saving is minimal – up to £5 a month maximum.
“And don’t forget if you go over your allowance on these lower-end contracts you can be hit with additional data fees which can really sting.
“We have designed HandsetExpert.com to allow people to compare the monthly deals from all providers with the same or a better deal by opting for a SIM Only deal.”
ends
About HandsetExpert.com:
HandsetExpert.com is an independent recommendation and price comparison site for mobile phones and SIM Only contracts, based in London, UK. Founded in 2014, we pride ourselves on our ability to find the best deals and prices available and providing helpful, unbiased information. With our easy-to-use interface, and unique features such as our SIM Only vs Pay monthly comparison engine, we ensure our customers always find the right phone and tariff for them.
About founder Dr Shahrum Gilani:
Dr Shahrum Nedjati-Gilani is the founder of HandsetExpert. He is a graduate of the University of Cambridge and University College London, and has a doctorate in Computer Science. His career and interests have spanned a variety of topics in science, engineering and technology. Dr Nedjati-Gilani is a published author in the fields of imaging and vision, and is using his skills and expertise to make HandsetExpert.com the ultimate recommendation site for phones and tariffs.
Notes to Editors
- Methodology:
- Phones: We considered 50 smartphones currently available for purchase in the UK retail market, covering a range of budgets from budget to premium. In cases where there are multiple versions available (e.g. the iPhone 6s, available in 12 storage space and colour configurations), we consider the cheapest option.
- Contracts & Tariffs: We defined 13 tariff categories, based on either data allowance or inclusive minutes, and considered Pay Monthly and SIM Only contracts that fell within these categories. For Pay Monthly contracts, we calculated the total cost of ownership (TCO) by multiplying the monthly payment by the duration of the contract measured in months and adding any associated upfront costs. For each phone and tariff category combination, we found the contract with the lowest TCO. In the case of SIM Only contracts where the contract length is less than that of the Pay Monthly contract, we multiplied the monthly payment by the duration of the Pay Monthly contract. In the case of SIM Only, we also included Prepay ‘bundles’ offering a monthly allocation of minutes, data, and texts.
- Pricing data sources: We acquired contract and pricing information both directly from retailers and via services that provide data feeds on behalf of retailers. The data was acquired at midday February 3rd, 2016.
- To read the full research paper, with detailed methodology, results, analysis, and figures, visit http://handsetexpert.com/pay-monthly-vs-sim-only-analysis-february-2016-paper.pdf
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About HandsetExpert.com:
HandsetExpert.com is an independent recommendation and price comparison site for mobile phones and SIM Only contracts, based in London, UK. Founded in 2014, we pride ourselves on our ability to find the best deals and prices available and providing helpful, unbiased information. With our easy-to-use interface, and unique features such as our SIM Only vs Pay monthly comparison engine, we ensure our customers always find the right phone and tariff for them.
About founder Dr Shahrum Gilani:
Dr Shahrum Nedjati-Gilani is the founder of HandsetExpert. He is a graduate of the University of Cambridge and University College London, and has a doctorate in Computer Science. His career and interests have spanned a variety of topics in science, engineering and technology. Dr Nedjati-Gilani is a published author in the fields of imaging and vision, and is using his skills and expertise to make HandsetExpert.com the ultimate recommendation site for phones and tariffs.
Notes to Editors
Methodology:
o Phones: We considered 55 smartphones currently available for purchase in the UK retail market, covering a range of budgets from budget to premium. In cases where there are multiple versions available (e.g. the iPhone 6s, available in 12 storage space and colour configurations), we consider the cheapest option.
o Contracts & Tariffs: We defined 13 tariff categories, based on either data allowance or inclusive minutes, and considered Pay Monthly and SIM Only contracts that fell within these categories. For Pay Monthly contracts, we calculated the total cost of ownership (TCO) by multiplying the monthly payment by the duration of the contract measured in months and adding any associated upfront costs. For each phone and tariff category combination, we found the contract with the lowest TCO. In the case of SIM Only contracts where the contract length is less than that of the Pay Monthly contract, we multiplied the monthly payment by the duration of the Pay Monthly contract. In the case of SIM Only, we also included Prepay ‘bundles’ offering a monthly allocation of minutes, data, and texts.
o Pricing data sources: We acquired contract and pricing information both directly from retailers and via services that provide data feeds on behalf of retailers. The data was acquired on January 15th, 2016.
To read the full research paper, with detailed methodology, results, analysis, and figures, visit http://handsetexpert.com/pay-monthly-vs-sim-only-analysis-january-2016-paper.pdf
