Most cellphone contracts in South Africa offer the convenience of including a “free” cell phone in the deal – but how much of that cost is built into the monthly fee? Wouldn’t it be cheaper if you just bought your own phone and just paid for your usage? Below we’ve compared the difference between what you pay for contracts which include phones in comparison to what you pay for contracts without a phone.
Currently for contracts that exclude the device are offered by Vodacom, MTN, Cell C and 8ta. From Vodacom, you can get a Top up 135 contract which costs R85 per month which gives you the line and the option to top up as you go. This option gives you the freedom of a dedicated line without a huge fixed cost – you can top up or save as you wish. Vodacom also offers a R99 per month contract which includes 2GB of data. The deal currently offered by MTN is at R39 per month for 500MB of data. Cell C has two no device deals currently on offer, starting with the Straight Up 50 contract which only costs R50 per month. The other contract available from Cell C is the Smart Data 2GB contract which costs only R99 per month and includes R2GB of data. The advantages of using these no device contracts are that you don’t have any huge cost looming every month and many of them are quite flexible so you can really find one that suits your requirements. The downsides are that the initial cost of purchasing a cell phone is quite high and you may not be able to fork out the money all at once; in addition, your contract won’t include any cell phone insurance, so if you break or lose your phone, the network won’t repair or replace it. Lastly, no device means no upgrade – so you’ll have to keep replacing your phone when it becomes obsolete.
By contrast, contracts which include the cell phone may be more expensive, as illustrated in the examples below, but will ensure that you always have a reliable phone.
Cell C’s Straight Up 100 S4 package is a 24 month contract that costs R399 per month. This package includes a Samsung Galaxy S4, one of the best phones available on the market valued at around R8, 500 to 9,000.00 – not a small amount by any stretch of the imagination.
On the Smart S contract from Vodacom, at R439 per month you can get an iPhone 5 which retails at around at least R6, 500.00. This price divided by the 24 months you would pay on a cell phone contract including a phone is around R270.00, meaning you’re saving about R168 each month which adds up to R 4, 032.00 in the long run. So basically the contract including the cell phone makes you pay around 80 percent of the phone price anyway – so much for free cell phone included! With this in mind, you should probably buy your cell phone separately from your contract. However, it’s not always that easy to find a couple of thousand extra in your bank account, which complicates things. Alternatively, if you’re very patient, you buy a really cheap phone initially and save the money towards a better phone in the long run.
Whether you decide to buy a phone and get a contract separately or if you get a contract which includes a device will depend entirely on what you can afford and your personal preference. If you have a phone already, or if you’re picky about your phone then perhaps getting a contract with no device included is the best choice for you. Alternatively, if you don’t have the money readily available for a phone and can’t afford to keep replacing it, then go with a contract that includes a phone – it will be more affordable and reliable.