Optus is selling Apple Watch and iPhone bundles on contract
Optus is offering up a variety of Apple Watch Sport smartwatches with selected iPhone 6s and iPhone 6s Plus plans, but device repayments don't offer much of a saving.
Buying a smartphone on contract means that you don't have to cough up money for it upfront, and also sometimes means you get the phone itself for less than it would cost if you buy it outright. The telco absorbs the price difference and makes up for it with the phone contract charges which you have to pay over 24 months, and that’s well understood. In some cases, buying outright remains cheaper, and you can use our Mobile Phone Finder to work out the cheapest way to purchase any phone.
If you bundle in additional devices, however, the situation gets more complicated. Optus’ latest deal offers the Apple Watch Sport in either 38mm or 42mm sizes with the iPhone 6s and iPhone 6s Plus on a 24-month contract. If you want both devices, that saves you having to pay up front, but our analysis suggests you won't save any money on the watch by doing so.
The deal doesn't cover every watch or phone variant. You can't bundle an Apple Watch Sport with older models such as the iPhone SE or iPhone 6 or iPhone 5s, although those phones are compatible with the Apple Watch. There's also only a limited range of choices for the watch itself on contract. For those who like a smaller watch face, Optus offers the Apple Watch Sport 38mm Space Grey Aluminium Case with Black Sport Band or Apple Watch Sport 38mm Rose Gold Aluminium Case with Lavender Sport Band. If you prefer a larger watch, the offerings are the Apple Watch Sport 42mm Space Grey Aluminium Case with Black Sport Band or Apple Watch Sport 42mm Gold Aluminium Case with Midnight Blue Sport Band.
If you opt for one of Optus' more expensive plans, you'll find that the cost of the iPhone is subsidised. However, that isn't the case with the Apple Watch. Optus charges a flat $18 per month for the 38mm watches and $21 per month for the 42mm variants, whichever model of iPhone or Optus plan you pick. Here’s how that pricing adds up over the life of the contract, and how it compares compared to Apple’s current Australian outright pricing:
|Optus Apple Watch option||Monthly additional cost||24 month total cost||Apple RRP|
|Apple Watch Sport 38mm Space Grey Aluminium Case with Black Sport Band||$18||$432||$429|
|Apple Watch Sport 38mm Rose Gold Aluminium Case with Lavender Sport Band||$18||$432||$429|
|Apple Watch Sport 42mm Space Grey Aluminium Case with Black Sport Band||$21||$504||$499|
|Apple Watch Sport 42mm Gold Aluminium Case with Midnight Blue Sport Band||$21||$504||$499|
In other words, you'll pay a few dollars extra for the Apple Watch on contract. That's not necessarily a massive penalty; after all, if you bought the watch with a credit card or via a personal loan, the interest charges would be much higher. But the usual risk of contract buying applies: there may well be a new Apple Watch model during the time you're paying off your original deal, and you won't have benefit of knowing that "at least I got it a bit cheaper than retail".
It's not clear whether there will be an upgrade. Apple hasn’t made much noise about updating the Apple Watch in 2016, but we wouldn’t be confident that nothing will change over a two-year contract, especially when you take the inevitable WatchOS updates into account. If Apple does launch a new Apple Watch model, the first generation model might be left without key features, and the older model might well become cheaper.
Note you do still get a handset discount on some of these plans for the iPhone 6s or iPhone 6s Plus. Here are the currently available Optus iPhone 6s and 6S Plus plans (without the Apple Watch bundled).