5 reasons to buy the iPhone SE without a contract

No thanks, telcos, we'll take it from here without contract

We know you've been waiting for the iPhone SE  and the good news is, it's finally available in Malaysia.

Priced at RM1949 and RM2449 for the 16GB and 64GB variant respectively, you can purchase it on Apple Malaysia’s online store or from authorised Apple resellers in the country.

The not so good news is that the full price is prohibitively expensive, which means you might sign up for a contract from one of the four major telcos to subsidise the cost.

However, if it was us, we'd rather buy it outright than be tied to a telco, and here are the reasons why.

1. The contract is just too long

A telco contract typically ties you up to a 24-month period. This is way too long, considering how fast-paced technology is today. With new phones being released every couple of months, a two-year contract is simply too long. In a couple of months, Apple is expected to release an update to its main iPhone (iPhone 7, maybe). 

A shorter contract, like Celcom’s new 6-month contract for Celcom First Platinum for the iPhone SE is a lot better but of course, the phone subsidy is a lot lower too.

2. The ever-changing telco scene

The telco scene in Malaysia is showing signs of change. Even before the whole Maxis fiasco that enraged most tech-savvy Malaysian users, other telcos like U Mobile, Digi and Celcom have been launching very competitive plans to attract customers.

Of course, after the whole Maxis disaster blew out of hand, the other telcos launched even more interesting promotions for subscribers. If you were tied to a telco plan, you would’ve missed out on all the excitement.

You'll probably be sulking at your contract that probably has another two to three months to go. The desire to just cut it loose and get a new phone might be attractive, but you would be subjected to a hefty penalty if you terminate it.

In other words, it's a lose-lose situation.

3. The penalty is just not worth it

Of course, you can terminate your contract anytime you want, but as mentioned before, you might be subjected to a hefty penalty.

Take Maxis, for example. If you terminate your Zerolution bundle (which is the only way you can purchase an iPhone SE with subsidy from the telco), you will not get a refund for the optional upgrade fee you’ve been paying. On top of that, you'll need to pay back a pro-rated retail price of the device depending on the number of months left on your 24 months repayment period (RRP/24 x number of months left).

So basically, you're still paying for the full price of the phone if you terminate early.

U Mobile has “Contract Freedom” that does not charge you any penalty for terminating their contract. However, their device bundle plans are not attractive as their normal postpaid plans but we’ll focus on that later.

Celcom charges a penalty of RM300 for 6 and 12 months contract, and RM1500 for 24 months contract (at reducing balance).

Finally, Digi also charges a termination fee, but that amount will be determined by the telco.

4. SIM-only plans with no contract are cheaper

U Mobile’s postpaid plans are definitely the most affordable among the major telcos in Malaysia. For only RM28 a month, you get 3GB of monthly data, 3GB of Video-ONZ, and 50 minutes of calls to all network. For those who need more, the U Mobile Hero Postpaid costs only RM70 a month with 15GB of data (till end of 2016, after that it will revert to 7GB), and unlimited calls to all networks. Sadly, these plans are not available in device bundles.

The regular bundle for Android devices starts from RM65 a month (Ultimate Device 65) with similar offer to U28, and iPlans starts from RM40 a month (i40), with much less offerings in the plan.

Maxis only offers the iPhone SE with its MaxisONE Plan 128 and above so for those who do not need 10GB of data, it's a complete waste. Might as well opt for MaxisONE 98, save RM30 a month and get the phone without contract. In the long run, you would have saved RM720 if you skipped that expensive plan.

Digi’s promotion for its postpaid plans (Digi Postpaid 80/78) are not applicable for device contract sign-ups, so that's out of the question for Digi users.

Celcom is probably your best bet now if you insist on getting a subsidy from the telcos. For the first time in a very long while, you can opt for a 6-month contract for Celcom First Platinum, which makes a lot of sense, especially when you are committed to paying RM150 a month. Celcom First Blue and First Gold come with 12-month contract, which are still long, but it’s better than getting tied for two whole years.

5. The “value” of the iPhone SE will drop after a couple of months

While the recommended retail price of the device may remain the same for at least a year, especially for Apple products, the “street price” may not.

Authorised Apple resellers sometimes have promotions (Machines was offering the iPhone 6s/6s Plus at RM500 off back in February).

Don't forget, there are people selling off their Malaysian units brand new in box that they “won in a contest” for a slightly lower price, and you can purchase the phone from online shops like Lazada and 11Street and apply coupons for an additional discount.