The New iPhone Isn't Worth It

We've all heard the hype and seen the queues, but is the new iPhone just for people who can afford to throw money down the drain?

It was one of the most eagerly awaited dates of the year. On July 11th, crowds gathered, queues mounted and thousands of gadget-lovers' hearts fluttered. 

The new iPhone 3G went on sale.

And then strangely, unexpectedly and - no doubt for Apple fans - impossibly, life for me and everyone else who failed to buy the phone has just, well, carried on as normal...

So, in an effort to understand what all the fuss is about, I toddled down to the Apple Store this week to have a quick play around with one. Is the new iPhone worth buying? Or, when it comes to value-for-money, is it over-hyped and over-priced?

Old dog, new tricks?

Aesthetically, the new iPhone looks similar to its predecessor (the only noticeable difference is the back, which now comes in either black or white plastic). However, it's the inside that counts with this gadget, and there are three main improvements Apple has made since the last iPhone launch:

1. The new iPhone comes equipped with 3G technology, allowing you (where coverage is available) to surf the internet at faster speeds. This makes browsing the internet a more pleasant, and quicker experience.

2. With the 2.0 software upgrade (let's not get too technical now), the new model has better tools for synchronising your email, allowing it to function like a Blackberry. Corporate email can now be sexy, providing a great tool for business users on the go.

3. The new phone also has GPS, meaning it can pinpoint itself accurately via satellite. This allows the device to offer more services tailored to your location, such as the ability to find nearby restaurants and businesses and map them according to where you are. A bit too Big Brother perhaps, but a handy tool nonetheless.

Like its predecessor, the iPhone is also incredibly easy to sync to your PC or Mac. You simply plug it in, and it will update your device with all the music and photos in your library.

iValue? or iRip-off?

So, that's how it compares to the old iPhone, what about the actual costs? Let's talk figures.

You can get an iPhone either with a brand new contract (minimum 18 months) or as an upgrade. If you already have an iPhone, you don't even have to wait for your current contract to expire before getting the new model. Simply agree to a new 18 month deal, and you could walk away with the phone for free.

However, if you want to buy one on a contract, you may end up with a plan that is incredibly poor value. At the moment, the iPhone is only available on the O2 network, with a minimum price plan costing £30 a month. For that you get just 75 minutes and 125 texts.

That's very poor value for money, and you'll also have to fork out at least an extra £99 for the phone itself.

If you're willing to pay more each month, you can get the 8GB phone for free, however (but not the 16GB). Here's a table of the different tariffs available:

But whichever plan you go for, you'll find the iPhone tariffs are very uncompetitive when you compare them with alternative plans currently available.

For example, T-Mobile's `Combi' plan gives you 700 minutes and unlimited texts for the same price of £30 a month, plus a free phone. You could even opt for the new Nokia N95, which also comes with 3G and GPS technology.

Alternatively, if you're willing to use your own phone, T-Mobile will give you 1,400 minutes and unlimited texts with their SIM only `Solo' plan. Either way, the difference in value is clear.

At the moment T-Mobile's `web n walk' service also comes free with selected Combi plans and phones, (normally costing £7.50), allowing you unlimited access to your email and the web. This way, if you do choose to get an alternative to the iPhone, browsing the internet won't end up costing you a fortune.

Squeezing value

If you're determined to bag the iPhone, then I would recommend you pay a bit extra and go for the £35 a month tariff, instead of the cheapest tariff, which is £30 a month. For an extra £5 a month, you'll get 500 minutes and 600 texts - much better value for medium to high users.

On this plan, the iPhone can work out cheaper than a Blackberry. For example, if you were to choose a Blackberry on an O2 tariff, you would have to fork out at least £35 a month - plus an extra £10 a month in order to get unlimited web browsing.

That's £45 a month in total.

However, you do get 100 more minutes with the Blackberry than you do with the iPhone, and twice as many texts, as well as unlimited O2-to-O2 calls. So you need to consider how you use your phone when deciding which is better value for money.

Mobile Web Users

The fact is, the iPhone is only worth it if you like browsing the web on your mobile. All iPhone plans include unlimited Wi-Fi (wireless internet access) at 9,500 spots up and down the country together with unlimited web browsing. This means that a poor value plan on calls and texts has a welcome bonus.

It is important to emphasise this, because other phones which allow you to browse the internet do not automatically include free web-browsing in the tariffs they come with. So you could be charged a bomb for taking advantage of the technology you paid for when you bought the phone. 

If you do need internet on the move, however, don't just automatically opt for the iPhone. Think about what you actually use the internet for and you may find you can get the access you need on a much cheaper tariff. For example, if you're a Facebook addict, Orange's pay as you go Dolphin tariff gives you 20 minutes of daily Facebook access when you top up by at least £10 a month. Little perks like this could end up making a vast difference to your monthly costs, so make sure you when you are picking a phone, you pick the right plan to match.

One last point to bear in mind is that, as with all new technology, the iPhone is certain to come down in price in time - the only question is when. Buy now, and you could be stuck in an expensive 18 month contract with little room for manoeuvre.

If your heart is set on bagging an iPhone, I suppose there's nothing I could say to convince you otherwise. And although I say the iPhone isn't good value for money, if you're a web user who rates the good design of your phone above all else, then it may be worth it for you. 

Either way, bear in mind that with the iPhone locked to only one network, this is a rare occasion when shopping around won't help.

Stock of the 16GB model is low at the moment, although the 8GB model is widely available across Apple, O2 and Carphone Warehouse stores.

Finally, whatever you decide to do, before signing on the dotted line, consider whether the iPhone really is a luxury you can afford - as in this case, being stylish has a very expensive price tag.

More: Find The Perfect Mobile Phone Tariff / Avoid These Mobile Phone Rip-Offs!