Shop around for a sweeter mobile deal

The iPhone 4S hit UK stores last week to mixed reviews. But what does the new phone mean for the mobile market? Is it worth ditching your existing phone in favour of the latest model, or are their better deals out there?

The new iPhone looks on the surface like the previous model, but reviews suggest that it is significantly quicker and has a markedly improved camera. It also boasts a new element called Siri, a voice-controlled feature that allows users to ask questions and make requests.

Research by InMobi, a mobile advertising network, found that one in ten existing iPhone users intends to buy the iPhone 4S, rising to nearly a fifth of BlackBerry users.

But is it worth it if you’ve already got an iPhone, a BlackBerry or a handset with Google’s Android operating system? It depends largely on whether you’re among those happy to pay a premium to have the latest item on the market, or if you just want to be able to access certain features unavailable on a basic handset.

Those getting the iPhone 4S sim card for free from an Apple store will have to fork out £499 for the 16GB model in black or white, although those wanting more storage could pay up to £650 for the new 64GB model

However, the vast majority of iPhone 4S buyers will get their handsets from mobile networks including Orange, O2, Vodafone, 3 and T-Mobile, rather than directly from Apple,

The main operators have priced their deals according to the different handsets. Orange, T-Mobile and Vodafone all offer the 16GB and 32GB handsets free of charge on two-year contracts, with monthly tariffs ranging from £46 to £62, depending on individual requirements.

As for plans where the handset isn’t provided free, T-Mobile has the lowest handset price, at £239.99, although that comes with a £25.54-a-month, two-year contract where call minutes and texts are limited to just 100 each.

Orange is charging £309 for the 16GB phone for those willing to pay a £20-a-month tariff over two years. However, the text and call minutes allowance is limited. The cheapest Vodafone deal is £26 a month, where the 16GB handset cost £359.

Handset prices and contracts for the 32GB iPhone range from £20 a month over two years with a handset at £449.99 from Orange to a £46-a-month deal with Vodafone that reduces the handset to £79.

The most expensive iPhone 4S is the 64GB version. Those on the cheapest Orange deal of £20 a month will have to fork out £519 for the phone, falling to £269.99 and £99.99 where the monthly charge is £36 and £61 respectively. Vodafone’s lowest monthly tariff of £26 means paying £519 for the handset. T-Mobile’s cheapest monthly plan – £25.54 over two years – prices the 64GB handset at £449.

Ernest Doku, technology expert at uSwitch.com, said the requirement to tie into a contract for two years in order to get a free handset would deter many potential buyers.

He said: “There’s very little in it between network pricing, so choice will likely be based on the value added by the providers, such as free trips to the cinema with Orange Wednesdays, Vodafone’s cashback offer or the all-you-can-eat data on 3’s One Plan, currently making up a third of iPhone contracts sold on uSwitch.”

However, there is a way to cut the cost, with some providers, including Vodafone, paying £40 cashback on pre-orders of the new iPhone, through websites including Quidco. Other networks are expected to follow Vodafone’s lead, making it the first time cashback has been available on iPhones.

The good news is that the launch of a new model should trigger sharp reductions in the cost of previous versions. Apple is cutting the cost of the 3GS and other iPhone handsets which run on the same software as the new model.

The 3GS handset, the oldest iPhone still being sold new, is now free to users happy to tie into a two-year contract, while the iPhone 4 price could fall to double figures, although its storage capacity is dwarfed by that of the new 4S.

And Doku believes the unless you’re attracted to the 4S by the Siri feature, the longer battery life or the enhanced camera function, an earlier iPhone could be a good deal as networks offer new deals on older models.

He said: “For example, the iPhone 3GS is now available from as little as £15 per month, and although it’s an older model, it shares many of the software features of the new 4S.”

Mike Wilson, manager of mobiles and broadband at Moneysupermarket.com, said: “The iPhone 4 will come quite a long way down in price. We will see a lot of new deals. You can already get it for free if you sign up for an 18- or 24-month contract, and they will become more competitive.”

Wilson pointed out that when the iPhone 4 was launched last summer there was relatively little competition.

“It’s only in the last 12 months that we’ve seen HTC, Samsung and Android really come to the market. And while the iPhone 4 and 4S are fantastic, think about exactly what you need because there are some great deals out there,” he said.

Doku said: ““Best-selling Android alternatives on uSwitch.com include the Samsung Galaxy S II, Samsung Galaxy Ace and HTC Sensation, which offer excellent user experiences at great prices.”

If you don’t need all the bells and whistles, the lower cost options include the HTC Wildfire or, if you want a phone using the Android system, the Samsung Genio, said Wilson.

“If you want to shop around, look at Android and BlackBerry because these do a lot that iPhones do, to an extent.”