Two-year-contract vs. BYO phone

[Poster]

Hi there,

I'm looking at the 32GB iPhone 5 on the Small plan, which I believe would be $71 per month on a two-year contract, for a minimum cost of $1704. 

Out of curiosity, I thought I'd look into Telstra's BYO option. Buying the 32GB handset from Apple costs $899 and, from what I can see, the BYO Small plan costs $50 per month (so $1200 over two years) which makes a total of $2099. That's $395 more than what it would cost to get the phone from Telstra.

I thought the whole contract and handset repayment thing was meant to be, well, not a scam, but that the total cost of ownership was greater than you might realise. But these figures argue otherwise. Why would you go the BYO option if getting a new phone would be cheaper? 

Am I missing something?

Thanks a lot.

[Ben_F]

The biggest thing for some people is the fact that they are locked in for 2 years, which is why some go for BYO.

B.

[Poster]

Yep, that makes sense. I guess I've never had a problem with the contract option, so have never looked at it from the other angle. And I can see how the freedom from a contract would be something some people would be willing to pay more for. I guess it's just always been a misconception of mine that signing up for two years of handset repayments was how the telcos got ya! They made it look like little tiny payments, but when you stepped back to look at the picture you were actually getting slogged, paying more over the life of the contract than you would if you bought it outright. Apparently not. 

[kheeta]

or becuase getting a phone out of telstra is like pulling teeth... slow and painful.