A new pricing plan from U.K. carrier O2 sounds awfully similar to the recent T-Mobile Uncarrier announcement.
The new O2 Refresh plan was announced this morning, and it is another sign that carriers are going to break the subsidy bond between mobile handsets on your service plan. Under the new scheme O2 customers will be paying two bills each month, one for their service and one for the price of their handset. While this sounds expensive on the surface, the amount they pay will be exactly the same as it would have been before. The difference, however, is if they choose at any time during the agreement to pay off their phone they can do so and immediately purchase a different one with no penalties or changes to their existing contract.
Should you opt to change phones during the contract, O2 encourages customers to use the O2 Recycle plan which could give them as much as £260 for trading in their old equipment.
The O2 Refresh plan will launch on April 16 with the Samsung Galaxy S3, S3 Mini, Note 2 and Ativ S, Blackberry Bold 9900 and Z10, HTC 8X and One, Sony Xperia T and Z, iPhone 4, 4S and 5, Nokia 820 and LG Nexus 4. The BlackBerry Q10 and Samsung Galaxy S4 will be added when those handsets launch.
O2 launches new tariff allowing customers to get the latest phone whenever they want
- O2 transforms the way consumers can purchase the latest mobile phones with the launch of O2 Refresh
- In an UK first, O2 Refresh offers customers the opportunity to get a new phone when they want, without having to pay out their airtime contract
- O2 Refresh will be available in O2 stores nationwide from April 16
O2 today announces the launch of O2 Refresh, the first 24 month tariff to decouple the cost of the phone from the cost of calls, texts and data. O2 Refresh has been designed for customers to get a new phone at any time, without having to pay out their airtime contract. Instead, customers simply pay the remaining balance for their phone and then start afresh.
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.
For those customers who want a new handset before the end of their contract term, O2 Refresh enables them to pay off the remainder of their Phone Plan and end their Airtime Plan with no termination fee. To make it even more affordable to get the latest smartphone, customers can trade in their old mobile for cash using O2 Recycle, getting up to £260 to put towards their new phone.
O2 Refresh also offers great long-term value for those customers who don’t want or need a new phone before the end of their contract term. Once the customer has paid the full balance of their Phone Plan, monthly payments dramatically reduce to just the cost of the Airtime Plan.
“Mobile phone technology continues to advance at a rapid pace, yet the way phones are sold has remained largely static,” said Feilim Mackle, Sales and Service Director at Telefónica UK. “Increasingly our customers are telling us that they don’t want to be tied to the same phone for two years and, with 4G coming to O2 this summer, we want to make it easier for our customers to benefit from the latest technology. For the first time in the UK, O2 Refresh will make it possible to get a new phone part way through a pay monthly contract, at any time – quickly, easily and cost-effectively.”
Choice of three plans
Customers will have a choice of three O2 Refresh Airtime Plans, which have been tailored to meet varying call, text and data requirements. For £12 a month, customers get 600 minutes, unlimited texts and 750MB of data; for £17, customers will have unlimited minutes, unlimited texts and 1GB of data and for £22 they receive unlimited minutes, unlimited texts and 2GB of data.
O2 Refresh has also been designed to give customers the flexibility to choose whether to make an upfront payment. The overall cost of the phone may be less depending on whether a customer chooses to make an upfront payment toward their mobile and which O2 Refresh Airtime Plan they opt for.
At launch, O2 Refresh will be available on a range of phones including the HTC One, Sony Xperia Z, Blackberry Z10, Samsung Galaxy S3 and Apple iPhone 5. Following the launch, O2 Refresh will be extended to include a wider range of phones, with a specific focus on high-end smartphones including the Samsung Galaxy S4*. O2 Refresh will be available in O2 stores from Tuesday 16 April and will be available online and over the phone in the coming months.
How O2 Refresh works
A customer buys a HTC One on O2 Refresh and chooses to pay £17 per month for their Airtime Plan and gets unlimited minutes, unlimited texts and 1GB of data. They then choose to pay £20 per month for their Phone Plan and pay £49.99 up front, meaning their combined O2 Refresh tariff costs £37 per month, the same as they would pay on a standard 24 month Pay Monthly contract**. The total amount they will pay for the phone is £529.99.