Shorter contract means cheaper iPhone

While the lowest monthly cost seems attractive, as iPhone contracts are so much more expensive than the same tariffs with other phones (compare on onecompare*), the real key is contract length.

That’s because when your iPhone contract ends, you can then legitimately unlock it and put any Sim in, saving yourself a fortune each month – so the sooner you’re out of contract the better. And as only Tesco offers an 12-month contract, even though it's far more expensive at the beginning, the shorter contract term makes it cheapest overall.

As the table below shows, if you can stretch the high upfront costs, the Tesco deal comes out on top. If you'd rather spread the cost a little more over the contract, or you need more minutes, check out the other deals below.

If you took one of the Tesco iPhone deal above, unlocked it after 12 months and switched to, say, a SIM-only deal, you could get the same package for £15/month still with unlimited data. Take T-mobile's PAYG Sim with unlimited texts and data and the savings could be even bigger.

It is worth noting though, that you can’t get the £60 additional cashback from Tesco as you can with some of the others as you need to go instore, or call 0800 001 4150 to get it (only PAYG deals are available online). Yet even factoring that in it’s still cheapest for most.

Allowances:

Tesco gives you £60 of credit to split between texts and and calls instead of fixed amounts of each. This sounds like a lot, but since Tesco charges 20p/min flat rate for calls, and 10p/text, it actually amounts to a maximum of 300 mins OR 600 texts per month at standard rates. You also get 12 months unlimited data and Wi-Fi at BT Openzone hotspots (same as O2).

Allowance is also boosted by Tesco's favourite numbers scheme, which gives you half-price calls and texts to your 5 favourites. For full info on this and other Tesco packages, check the Tesco Mobile site.

Lower upfront costs: 18 month deals

If you don't want to pay so much upfront for the handset, you'll need an 18 month deal, starting at £30/month. Both O2 and Vodafone only offer customers 75 inclusive minutes per month on these contracts, though Vodafone offers twice as many texts as O2.

Overall Orange wins on calling and text allowance, with 150 mins and 250 texts (still less than Tesco above), though it's worth noting here it also has the lowest fair usage 3G data allowance, at 750MB/month (though it reduces allowance rather than charging if you exceed it).

Vodafone offers a 1GB monthly allowance, but you'll pay a potentially steep 50p/day if you exceed this, while O2 and Tesco have no set limits, but 'fair usage' applies.

O2 & Orange, double minutes from £40/month all in

O2 and Orange offer 600 mins rather than Vodafone's 300 as standard on their £35/month tariffs. Yet with a bit of work you can double this for the first nine months. This is because with both it's possible to save around £100 on the upfront iPhone cost by taking out a £45/month contract instead of £35/month. Yet...

You needn't stay on that tariff for the 18-month contract; O2 and Orange let you downgrade after 9.

This means while you'll spend £90 more than you would've in the first 9 months of ownership by taking a £10/month more expensive contract, you'll have saved £100 on the initial cost of the phone, leaving you £10 up overall. Plus for the first nine months you'll have double minutes, as the table below shows.

Unfortunately it isn't possible to do this on Vodafone, as it'll only let you downgrade a month before the contract ends. The Vodafone £35 contracts do have slightly lower upfront costs though. Full Vodafone £35 deals info

While the overall cost after downgrading still doesn't beat taking out the base level £30 contract from the start, if you'll use the extra minutes it's a good option.

It's a nice loophole, but the networks may well be calling your bluff; they hope you'll take out the £45 contract then forget to downgrade in time.

Set some reminders.

The iPhone's calendar's a good place to start; skip 8 months ahead and write your future self a note about arranging the downgrade. To be doubly sure, use our Tart Alert. Just tell it when the 9 months'll be up, and it'll text you a reminder 6 weeks in advance, giving you plenty of time to make the switch.

Grab up to £65 cashback on top

If you want an iPhone (any model) on Orange, order via Go Mobile on either Topcashback or Quidco* and you can get £65 cashback. Quidco takes the first £5 you earn each year as an admin fee, so the cashback will amount to £60 off for its new users.

Other networks:

For iPhone 3G S (16 or 32GB) models on other networks' contracts, Mobiles.co.uk, which is part of the Carphone Warehouse group, is offering £60 via Quidco*, or £55 via Topcashback*, which is completely free to use.

It's worth noting that the transaction will track at 1p for a couple of weeks, before being updated to £40, and then £60 a week later. You should get the money within a month after this. Added to the £10 overall saving from taking a more expensive contract then downgrading, this amounts to £70 off.

Unfortunately this cash is never guaranteed, as sometimes cashback sites don't 'track' deals in progress, but with headline deals like this it usually works. To find out more about how these sites can pay you, and how you can make the most of them, read the full Cashback Sites guide.

iPhone unlocking

Since O2 lost its iPhone exclusivity, it's now possible to legitimately unlock UK iPhones. Currently O2's the only provider that has released unlocking info. Pay monthly customers needn't pay a penny to free their handsets, while there's a one-off £15 charge for Pay As You Go customers.

To do it, you just need to complete its unlock form on O2's site and wait. It can take upto 14 days, and iTunes will confirm the unlock while syncing. Now you can use the phone with any Sim card. Full details.

This section will be updated when other providers' unlock info becomes available.

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