What do ‘free mobile phones’ really cost?

Which? takes a look at ‘free mobile phone’ deals and finds out what price you’re really paying.

Orange recently revealed its pricing for a subsidised iPad, offering the tablet for £200, but locking customers into a £27 a month contract. This has prompted many to comment that the lifetime cost is £847 whereas a similar deal on a PAYG contract would only cost £769.

This type of pricing is nothing new – particularly with mobile phones – and proves that ‘free’ is often very far from the truth.

HTC Desire HD deals

Checking out the deals on our website for the HTC Desire HD, we found the cheapest lifetime cost for an 18 month contract – excluding cashback and line rental deals – was £539.99, which included an upfront cost of £179.99 for the handset.

The cheapest –over the lifetime of the contract – deal to include a ‘free’ Desire HD ends up costing £630 – almost £100 more.

Sony Ericsson Vivaz deals

Looking at the Sony Ericsson Vivaz Pro for similar deals it’s an even bigger difference – costing £120 more for a free handset rather than paying £149.99 for the handset.

Nokia X6 deals

Some differences are more subtle, but can have a big effect on your pocket over the whole length of the contract. By paying just £11.71 upfront for the Nokia X6, it’s possible to get £5 off the monthly cost of an 18 month contract for the same amount of minutes.

This takes the lifetime cost down from £450 to £371.71. That’s almost an £80 saving for the sake of paying just over a tenner upfront!

Research pays

While most of the cheaper deals do include fewer minutes and texts, it shows it may often be better to pay a little upfront, rather than being bumped-up to the next deal for the sake of a cheaper handset – especially if you know you are not going to use those extra minutes or texts.

You can do some lifetime cost analysing yourself. Just head over to our brands page, pick a phone you like and check out the deals. We calculate the true monthly and true lifetime cost of each deal, so you can make sure you’re getting real value for your money.