What is a SIM Only Deal?
SIM Only is a type of monthly contract that is offered by either network providers or MVNO’s (Mobile Virtual Network Operators like EE, Vodafone, O2, Tesco Mobile etc ) whereby you only pay for the SIM and with it, minutes texts and data. As the name may suggest, you get the SIM card and the SIM card only, which is the dividing factor between SIM Only and smartphone contracts. Which begs the question: What is the point of opting for a SIM Only deal? There are a plethora of benefits with SIM Only deals that you don’t get with traditional phone contracts.
The advantages of a SIM Only deal
It could cost lots less!!
SIM Only deals tend to be significantly cheaper in the long run compared to contract agreements because you’re not paying back the cost of a new smartphone, just the service. In the example, we looked at for an unlimited data contract with an iPhone 13 Pro Max the total cost is £1,658 over a two-years, however, if you were to buy the phone outright and have an identical SIM as a SIM Only deal it costs just £1,313 in total. That’s almost £400 in savings!
You’re free to choose a provider
Most SIM Only contract deals mean you’re not tied to any one provider, and some SIM Only contracts are as short as 30 days. If you don’t like the deal, you’re able to swap freely without having to worry about any remaining debts for handsets etc.
You can stick with your phone
If you’ve got an existing phone SIM-Only allows you to stick with the phone you want without compromising on your package opportunities.
The disadvantages of a SIM Only deal
Handsets are expensive
The cost of a phone, especially flagship phones in 2021, can quickly surpass the point of what we’d prefer to pay upfront. And while SIM Only is still cheaper in the long run, they require a much higher upfront cost as opposed to the typical sub £50 upfront costs of most contracts. And while SIM Only is still cheaper in the long run, they require a much higher upfront cost as opposed to the typical sub £50 upfront costs of most contracts.
The advantages of a mobile phone contract deal
No upfront handset cost required
Although technically it’s not really free, the phone that comes with the contract is usually the most expensive component of your monthly plan. Since the latest smartphones can cost upwards of £1,000, mobile phone networks make them more affordable by including handsets in their price plans, so you can spread the cost out over 24 or 36 months. This certainly makes getting a brand-new smartphone easier than buying it outright. For instance, the iPhone 13 Pro Max costs £1049 without a contract. But if you get your hands on a model with a contract deal attached to it, you can instead pay £65 for unlimited minutes, texts and 100GB of data.
Some providers will offer freebies such as chucking in a pair of headphones, an iTunes Voucher or perhaps a case for your new handset to try and lure you in.
The disadvantages of a mobile phone contract deal
You’re tied into a set mobile network provider, potentially for 24 or 36 months. This is a long time if you run into financial difficulty, or your reception is poor where you live (even though there's a requirement for all providers to ensure a certain level of network cover) or maybe you’ve now found an alternative plan after opting with your contract that offers improved benefits over your current plan. Also, it's a long time if you’re itching for a new phone!!
You’ll undergo a check on your credit history and if it’s not so good, a contract deal may not be an option for you.
In truth, different options will suit different people, however, the team at C247 agree that in our case the benefits of SIM Only far outweigh opting for a phone contract which ties you in. The flexibility of switching and choosing your own handset at any point, options you have for choosing and switching a SIM plan that’s right for you, and not forgetting the savings you experience in the long term on your hardware makes buying a stand-alone mobile phone and opting for a SIM Only deal the perfect choice in 2021.