O2 smartphone contract splits handset costs from tariffs for easier upgrades

O2 smartphone contract splits handset costs from tariffs for easier upgrades

Summary: O2 has launched a new 24 month tariff that decouples the cost of the handset from the cost of the services, meaning customers can upgrade their handsets whenever they want, or alternatively, cut the cost of the contract by not upgrading the device at the end of the term.

SHARE:
1

O2 has launched a new mobile smartphone contract that splits the cost of the tariff from the cost of the handset, meaning that customers can upgrade their device whenever they want.

The new tariff, called Refresh will be available for customers to sign up to from 16 April and offers customers the option of paying for their handset separately to the airtime left on the contract.

"When a customer signs up to O2 Refresh, they choose a Phone Plan and an Airtime Plan. By signing up to and paying separately for their phone and airtime, customers are given complete transparency, while paying the same overall as they would on a standard 24 month Pay Monthly tariff," the company said in a statement.

The Refresh plan is being offered on at three different levels to appeal to a wider range of customers. For £12 per month customers get 600 minutes, unlimited texts and 750MB of data. Bumping that up to 17 per month removes limits on call time or texts and increases the data allowance to 1GB. For £22 per month, that data allowance can be increased to 2GB.

The Phone costs can vary, but for example, if a customer decided to opt for the HTC One and pay £49.99 up-front for the handset, they would then pay £20 per month for the remainder of the contract. In addition to this, they would also be paying the service agreement charge, so, £12, £17 or £22 for the duration of the contract.

By decoupling texts, data and mobile minutes from the cost of the handset, customers have the option of upgrading a handset early by paying off what is left of the Phone payments. It also allows customers that don't want to upgrade their handset at the end of the 24 month contract to simply continue paying for their service tariff.

At launch only certain devices will be available on the Refresh tariff, including: the Samsung Galaxy S3, S3 Mini, Note 2 and Ativ S, Blackberry Bold 9900 and Z10, HTC 8X, HTC One, Sony Xperia T and Z, iPhone 4, 4S and 5, Nokia 820 and LG Nexus 4. O2 said that the upcoming Samsung Galaxy S4 and BlackBerry Q10 would also be available on the deal.

Topics: Smartphones, Mobility

Ben Woods

About Ben Woods

With several years' experience covering everything in the world of telecoms and mobility, Ben's your man if it involves a smartphone, tablet, laptop, or any other piece of tech small enough to carry around with you.

Kick off your day with ZDNet's daily email newsletter. It's the freshest tech news and opinion, served hot. Get it.

Talkback

1 comment
Log in or register to join the discussion
  • excellent!

    now if only I could get one of them to issue 12 month contracts for those of us that don't mind paying more for the device initially/spreading payments over 12 months... to be honest it's been getting to the stage now that you're almost better off buying an unlocked phone on a credit card, paying it off and getting a sim only deal; these are as low as £6 now.

    I understand that the cost of high end phones has more than doubled in the last 5 years, and so it takes longer to cover the cost, but I've long been against the culture of a free phone and large payments for a long time... sure a lot want it, but it's hardly any extra effort for them to offer the alternative to those that want it.

    it's a nice idea.. now let's see if anyone else can better it. Let's be frank, o2 dn't get the smartphone thing. I joined them with the original iPhone, when you got unlimited data... then every other network got the iPhone and unlimited data plans, so O2 decided to be rediculously stingey with their data allowances. 2GB on a 42 quid a month deal? three will give you unlimited, tmobile will give you unlimited, ee will limit your data, but make it 4g; while giving you unlimited calls and texts.

    O2 have been so far behind the others for the last year or so. They really need to do more to keep on to their customers. When I was looking for a plan for my iPad, despite having been with them for years, and knowing how bad customer service three have, it was still a no-brainer. 15GB for the price of 2GB with o2.. and three had hspda+
    MarknWill