Unfortunately, I’m going to be saying goodbye to giffgaff in the New Year. I’ve absolutely loved being with giffgaff for the last 18 months and for what I’ve needed recently they’ve been the perfect company. When I do leave, I’ll miss a lot of things like payback, free g2g calls/texts and the extremely good value goodybags.

However, I’m going to be leaving giffgaff in favour of a contract deal – which, unusually, I think is a pretty good deal. It’s with O2 (so I’m not going that far astray!) but I’ve bought it from dial-a-phone (who are owned by phones4u so can’t be too bad).

I’ve just ordered the new HTC Sensation XE with the beats earphones (never used a beats product before, but I’m told they’re very good). The phone has a 1.5Ghz dual core processor, 8MP camera with flash and autofocus, wi-fi, GPS, 1GB flash storage and micro-SD expansion, the latest version of android with the probability of an upgrade to ICS, 4.3" qHD screen, and various other cool things. In terms of specs, in a number of ways it’s better than the latest iPhone 4S (I’m astonished by the 1.5Ghz dc CPU in a phone). Big step up from my current phone – Nokia 5230.

With the contract I get 200 minutes, unlimited (with FUP of about 3000) texts and 500MB data. The minutes should be fine for me, texts no problem at all (rarely use more than 300 texts in a month), and the data SHOULD be ok. Whilst I’d like to have 1GB or more, I can suffice with 500MB and will just have to watch the usage. I will miss the unlimited internet on giffgaff!

For this package, I’ve paid £19.99 upfront and agreed to pay £21.50 a month for the next 24 months. Bit steep, you say – but when you work it out it isn’t actually that bad at all.

To buy the phone SIM free (for use with networks like giffgaff) it would cost me around about £420 (link). Then you add the fact that with giffgaff I’d spend £10 per month on a goodybag – over 24 months that’s £240. So grand total comes to £660 over 24 months. To be fair, one could argue I could make a lot of that back with payback – but that involves extra work so I’ll ignore that for now.

With the contract it’s £19.99 + (£21.50 * 24). Also, minus the fact I’ve earned £50 cashback with quidco for the contract purchase. This means the total cost comes to £485.99 if my maths is right, over a period of two years.

Obviously I’m loosing out on some things – and the giffgaff goodybag is better (in terms of the monthly allowance) than the contract. My biggest loss will be the truly unlimited internet – but right now I’m told in my giffgaff statement that the maximum data I’ve used in a month is 570MB – so I could easily trim that down. Obviously I know my data usage will increase slightly with a proper smartphone – but I’ve got wi-fi to counteract that.

I also have added bonuses – because I can’t take out the contract until I’m 18, a parent has taken it out for me and agreed to pay it until my 18th birthday as my Christmas present (next April), so the actual cost to me is slightly less (about £120).

So overall, it works out better to go with the contract. I’ll be very sad to leave giffgaff – but it just comes down to the sheer cost in the end. When you do the maths, pay as you go isn’t always the best way! I hope that giffgaff have a really bright future ahead of them though – they’re doing really well so far.

In any case – stand by for an HTC Sensation XE review in a couple of weeks time!