In the U.S,. three of the four major carriers are now offering a plan that allows you to get a new device more frequently than the standard 2-year contract time frame. This sort of reminds me of the lease vs buy conundrum when you are getting a new car.
Under is a comparison for the major carriers in the U.S. Costs are based on a 16GB iPhone 5. Note that these figures do not include carrier service.
| Verizon | AT&T | T-Mobile |
| Plan | Edge | Next | JUMP! |
| Upfront cost | None | None | $145.99 |
| Number of payments | 24 | 20 | 24 |
| Eligibility for upgrade | After 6 months if 50% of phone is paid for | After 12 months | Twice every 12 months. 1st upgrade after 6 months. |
| Devices | Phones | Phones, tablets | Phones, tablets |
| Monthly cost | $27.15 | $27.00 | $21.00 |
| Total Cost | $651.60 | $540.00 | $649.99 |
| Trade at 6-month intervals (4 phones in 2 years) | $1,300.00 | Not available | $1,088.00 |
| Balance at end of 2nd year | $488.70 | $378.00 |
| Trade at 12-month intervals (2 phones in 2 years) | $651.60 | $648.00 | $795.98 |
| Balance at end of 2nd year | $325.80 | $216.00 | $252.00 |
After you upgrade, the remaining unbilled installment payments on your ‘old phone’ are waived. Note, however, that when you upgrade, you have to trade in your current device in good and functional condition or you will be responsible for the remaining balance. You also need to purchase a service plan.
If you are certain that you will upgrade more frequently than every two years then one of the plans above should meet your needs. Sometimes the decision of what carrier is not just about cost. If you end up keeping the phone for two years without trading it in, you could have done so with a standard two-year contract, purchasing a subsidized phone for $199.99.
