Wednesday, June 09, 2010

iPhone usage analysis

I'm going to be replacing my iPhone 3G with an iPhone 4 shortly.  I got my current phone on an 18 month £30 contract - the cheapest available at launch.  I calculated that a PAYG option would have been cheaper for me but O2 didn't launch it until a few months had elapsed.

Given my usage pattern over the last 2 years, would I still better off with PAYG?

If O2 make it easy to see historic usage graphs then I couldn't find it.  After some laborious copying in to a spreadsheet I ended up with:

Talk minutes: average 23, min 9, max 51
Texts: average 40, min 22, max 78
Data in MB: average 165, min 107, max 292

This usage pattern was achieved whilst on a contract: for the first 18 months it included 75 minutes and 125 texts, and currently includes 600 minutes and 1200 texts (£20/month).  I used the phone fairly frivolously because I was always well within my allowance.

What about data?  O2 used to be "unlimited" but now has a 500MB limit, after which they reduce the speed.  This is according to the O2 rep responding to comments in the O2 blog where they announced the 500MB cap.

"If you go over your data limit and don't buy a Bolt On then your data speed will gradually slow down. You won't be charged further.

So it looks like a 500MB "limit" is fine for me.  I've only exceeded 200MB twice in two years.

iPhone revisions seem to be an annual occurrence so an 18 month contract seems odd.  Choosing 12 or 24 months is probably wiser, depending on whether you really need to have the latest handset or if you can survive the second year with a superceded model.

I currently get my broadband with O2 and I get a £5/month discount for also having a mobile with them.  The rest of the family are on Vodafone so if I switched mobile providers I'd lose the discount.  I've been content with O2's coverage although I think Vodafone would be better.  So unless Vodafone have a significantly cheaper option for the iPhone I'll be sticking with O2.

I've used over 90% of the storage on my 16GB 3G.  The current selling prices for the 16GB and 32GB 3GS are £237 and £282 respectively.  So whilst there is a £100 premium for the bigger version you should recover about £45 of that if you sell it after 2 years.  Given photos at 2.5 times the resolution of my 3G, and HD video recording, it seems prudent to make sure I've got sufficient storage so I'm only looking at the 32GB version. 

The low use and cost options that look like candidates are:

1) £30/month for 18 months.  £323 for 16GB version.   100 mins, unlimited texts

Over 2 years: £323 + £30*18 + £10*6 = £923

2) £25/month for 24 months. £249 for 16GB  version. 100 mins, unlimited texts

Over 2 years: £323 + £25*24  = £923

3) PAYG.  £599 from Apple (O2 aren't doing PAYG until they stop being able to fill their orders with contract customers).

O2 PAYG: When you top up with £10, you get 500MB and 300 texts to use within the next month.  So if you spend less than £10 on calls each month they you will be carrying over some credit each month.  Calls cost 25p a min for the first 3 minutes a day then 5p a minute for the rest of the day.

I used an average of 23 minutes when I was on contract - I'll use a bit less than that on PAYG, say 20 minutes.

20 mins * 25p/min = £5.00 on calling costs.

So each month I top up I'll end up with an extra £5 of credit.  At some point I will stop topping up and will instead spend PAYG credit on the Web Bolt On which costs £7.50 for a month of data plus texts at 10p and minutes at 25p/min.  Once my balance drops too close to zero I'll revert to £10 top ups again.

So the pattern may look something like this:

Month 1: £10 topup, data and 300 texts included, £5 spent on calls, balance £5
Month 2: £10 topup, data and 300 texts included, £5 spent on calls, balance £10
Month 3: £10 topup, data and 300 texts included, £5 spent on calls, balance £15
Month 4: £10 topup, data and 300 texts included, £5 spent on calls, balance £20
Month 5: no topup, spend £7.50 on Web Bolt On, £3 on 30 texts, £5 on calls, balance £2.

So 5 months costs £38.  24 months is about £190.

Total cost for 2 years of iPhone 4 32GB = £599 + £190 = £789.  Or £1.08 per day.

And if you can sell your iPhone after 2 years for £200, it's only £589 for 2 years = 80p per day.  Which is cheaper than a small coffee or bottle of coke.

Just for interest, if you used your iPhone like an iPad and could live with no phone calls nor texts (you will actually have 300 texts/month for 3 in 7 months):

Month 1: fund £10, balance £10
Month 2: buy Web Bolt On for £7.50, balance £2.50

you end up spending about £110 for 24 months (ending up with some credit).

My iPhone 4 is now ordered.  O2 have sent me a micro SIM and scheduled a switch over date to PAYG.  Can't wait.


Chris said...

Another option to think about is the O2 iPhone simplicity tariff on a 12 month contract. This works out as:
£449 for the 16GB iPhone
£15 / month for 2 * 12 months
(Sorry no link to the tariff details, O2 are "updating their site" right now, but I seem to remember it's comparable to the £35 iPhone tariff)

Which gives you a total of £809. This beats options 1 & 2 in my mind; you get a decent amount of included texts and minutes for £30 or £40 less than the contract price, and most importantly it gives you the flexibility of being on two separate back to back 12 month contracts... perfect should WWDC 2011 have something to catch your eye :)

So lets call this option 4... I'd say it's a choice between options 3 and 4, but I bet you wouldn't get much change out of the £48 that option 3 saves you after the occasional heavy-usage month over two years.

Chris said...

Forgot to mention:

Seems to suggest there will be a PAYG option at launch :)

sam94 said...

How about using the IBM tarrif? How about getting a family price from Vodafone? How about getting an O2 PAYG sim and topping up with £10 every 3 months to reduce your broadband price. How about a change in usage based on the new function?

Chris said...

Dude, I forgot about cashback :) Quidco & Reward Gateway both offer £25 cashback on O2 SIM only 12 month contracts, so assuming a similar deal is around in 12 months, you can nab that twice & save another £50.

So £759 for 24 months with 300 minutes & unlimited text, data and wifi. That's gotta be difficult to top ;)

Russell Finn said...

Or maybe a mix of PAYG and (4), since the first year includes the data.

449 - PAYG purchase
8*12 = year 1 calls/texts 96
15*12 - year 2 data + lots of calls/texts
-25 cashback for the contract on the second year
= £700 for 2 years.

How sure are we that the cashback will be forthcoming?

Russell Finn said...

A quick look at Vodafone's contract options:

16GB, £189 + 24*£25 with 75 mins, 250 texts, 1GB data. This is similar to O2 but the up front cost is £60 less.

The price jump to get to 32GB is £91 - £9 less than O2.

PAYG costs are 20p a minute for talk and texts are 10p which is perhaps slightly better than O2. But I can't find a handset price for an iPhone 3GS from Vodafone - don't they sell it?

sam94 said...

that's a lot of money. may be worth adding insurance to the bill