When a new premium smartphone enters the market, it's typically going to sell for well over $1,000. Some models of Apple's latest iPhones even soar above the $2,000 threshold. That's a serious chunk of change to lay down and you may have seen a number of ads online for Australian retailers offering what appears to be those very devices at a significant discount, sometimes selling them for hundreds of dollars less than RRP.
These retailers are typically importing those phones from other countries where they're sold at a cheaper rate. They'll add a small margin of profit for their troubles and undercut the "official" price along the way. This process is often referred to as direct importing, parallel importing or sometimes "grey-market" importing.
For the most part, buying a grey-market phone is entirely legal. Any device imported and sold by an Australian business has to comply with the relevant Australian safety and packaging laws, but that's far more of a concern for something like food and perishables than it is for a mobile phone that's already being sold locally by the actual supplier anyway.
There are some restrictions in place for parallel importing of certain products, but mobile phones don't fall under them. Mobile phone manufacturers might not like it much, but grey-market imports are perfectly legal.
The biggest danger to be aware of when buying a grey-market phone is shady resellers. Some people simply want to make a quick buck at someone else's expense and the import smartphone market has its fair share of dodgy dealers to avoid.
That said, you should be quite safe as long as you do your research. If you're dealing with a business that says it is based in Australia, double check. Make sure the address of the office it operates out of is legitimate, confirm its contact details are valid and seek out as many customer reports as you can. A simple online search for the merchant name plus either "mobile phones" or "complaint" should provide you with a better overall picture of how a given supplier operates when things go wrong.
If you can't find any feedback or other online references, that could be a telltale sign that you're dealing with a fly-by-night operation. Established merchants should have a genuine online presence with referrals, partnerships and user testimonies, and this should extend beyond their own websites.
To get you started, we've compiled a list of some of the most popular retailers that offer grey-market phones:
The other key issue to keep in mind with grey-market phones is that they aren't always identical to their local counterparts. There are minor differences such as the pre-installed applications that carriers often wedge into the phone's operating system and the splash screens that promote their brands every time you boot up the device. Such differences are trivial and if you're really keen you can normally download any missing applications from the Android or iOS app stores anyway.
What you really need to watch out for is network compatibility. Mobile networks operate on different frequencies in different countries and phone manufacturers often build multiple models of each of their phones to suit the frequencies and bands used in those countries. How many models of a phone there are varies by manufacturer and brand, with some devices such as Apple's iPhones only really having five or so distinct "models" to worry about. Conversely, some Samsung Galaxy product lines have had dozens of slightly different phone models tuned for their respective regional markets.
To make sure a specific grey-market phone will work here in Australia, take a look at our guide to the current frequencies used by Australian mobile carriers.
It's also worth noting that compatibility isn't a binary problem. Even if a grey-market phone supports some Aussie frequencies, those frequencies may be limited to 3G speeds rather than the faster 4G. The differences between 3G and 4G can be significant if you're a heavy data user, but for those who use their phone mainly for calls and texts, the savings might make up for the slower download speeds.
International phones shipped to Australia frequently come from countries like Hong Kong that use power connectors incompatible with Australian outlets. This means the charger that comes packed in with your phone isn't going to work out of the box.
Some import retailers will throw in an extra Australia-compatible charger or an adaptor for connecting the default charger to an Australian outlet. This isn't always the case, though.
Fortunately, a standard Australian microUSB cable or power adaptor will charge most modern smartphones (excluding iPhones) whether they were bought here or overseas. Both the microUSB standard and Apple's Lightning cable are the same around the world, so provided you have a spare charger or cable kicking around, you won't have any issue keeping your grey-market phone topped up.
The one challenge you can face here is that the "fast charger" sold with some phones might not be suitable for 240V Australian power. Check carefully before using a plug adaptor in that case, as you may need a step-down transformer for it to work at all.
The last big consideration to keep in mind with grey-market phones is warranty support. Australian consumer law states that your contract of sale is with the original merchant, which in this case wouldn't be the phone manufacturer but rather the online retailer you purchased the phone from.
Under Australian consumer law that retailer is legally obliged to warrant goods for a "reasonable" length of time even if they're imported, but it may require that your device be shipped back to its country of origin for inspection and repair. This can leave you without a phone for multiple weeks in some cases.
If you're buying a phone directly from an overseas supplier instead of a local retailer, it too must abide by the same legal constraints. The challenge here is that chasing up a warranty claim with an entity thousands of kilometres away can be a nightmare, requiring numerous emails, form submissions and delays.
Before you consider ringing up the local customer service department for the manufacturer of your grey-market phone, bear in mind that it isn't obliged to deal with any warranty or repair issues. Some brands do offer "worldwide" warranties and may at least examine your device to see if it meets warranty guidelines, and they may even offer to repair it at cost.
Other brands specifically state that they won't honour warranties for phones sold outside Australia. That said, many are willing to consider claims on a "case by case" basis, so it may be worth enquiring with them if you hit a problem with the retailer you bought the phone from. Local brand representatives may be prepared to repair your device in some cases, though it's likely they'll charge you even for devices that would otherwise qualify for warranty protection.
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