UK network 02 has launched a new tariff named O2 Refresh, where the aim is to simplify the process of upgrading hardware, without any costly early termination fees. It has done so in a similar way to T-Mobile’s Uncarrier plans, with a little of Vodafone’s Red Hot phone leasing scheme thrown in.
At its heart, O2 Refresh splits the bill in two, providing one for the airtime contract and another for the phone, then allows both to be paid off at any time without a penalty. Here’s how it works: Say you want the HTC One, and would like the £17 per month airtime contract which provides unlimited calls and texts, plus 1GB of data. You sign-up for the airtime plan for two-years, and then do the same on a separate agreement for the phone, which costs £20 per month with a £50 upfront payment.
The phone will go on to cost you £530, and once it’s paid off, you’re left paying nothing but the £17 airtime bill each month. However, the idea is not to get this far, as you can pay off the remainder of the phone plan, cancel the airtime plan, and then chose a brand new phone at any time. All without paying any extra. O2 also has a trade-in scheme, where you can sell your phone back to the network to offset some of the cost.
Three airtime plans, and a good choice of phones
O2 will offer three monthly airtime plans, the aforementioned £17 per month option, plus one with 600 minutes and 750MB of data for £12, and a £22 option with 2GB of data and unlimited calls and texts. As for the phones, the HTC One will be joined by the Sony Xperia Z, the BlackBerry Z10, the Samsung Galaxy S3 and the Apple iPhone 5. Once they’re released, the BlackBerry Q10 and the Galaxy S4 will also be added to the list.
As the Refresh pricing appears to be the same as a regular contract with O2, it’s more about making signing up for a phone less complicated, and enabling people to take control of their mobile contract plans. It’s a strikingly similar ethos to T-Mobile’s thinking behind its new system, just without the launch-day theatrics. What it’s not though, is particularly stunning value, as buying an unlocked phone and getting a rolling contract SIM through GiffGaff or Three will inevitably work out cheaper. However, O2’s way at least provides the option to upgrade when you like, provided you’ve got the cash to pay off the phone, and it’s very difficult not to applaud a scheme that doesn’t tie you down to one phone and a contract for two years.