Add the £120 that O2 will charge me to upgrade early next year and it's £51 cheaper.

I'm only upgrading as I want to ponce around with a shiny new iPhone, not much wrong with the one I have at the moment (well maybe there is nothing wrong with it!). I suspect I'll want to ponce around with next new one next June/July too.

I would also be free to swap to their £15 a month tariff if my usage changes, or use a foreign SIM in it if I wanted. I have my first wedding abroad booked so that is now a real possibility of saving me money.

There us only £30 difference in your example, for that I think at this point I'd rather the extra flexibility it gives me. Not sure yet. Not made my mind up.

Cheers

Cris.