O2 has launched its Refresh tariff, which decouples a handset from a customer’s usage.
This meant customers could get a new phone mid-contract, without having to pay out their usage contract.
The 24 month contract would be available from April 16 and meant customers would pay the remaining balance for their phone, then start afresh.
O2 said it gave transparency to the tariff transaction by giving a customer separate phone and airtime plans, that in total cost the same as a standard 24 month Pay Monthly contract.
Customers who wanted to upgrade devices would be able to pay off the remainder of the phone plan and end their airtime plan with no termination fee. Customers could also trade in their old mobile with O2 Recycle, the company said, for up to £260.
Customers not upgrading would find monthly payments reduced to the cost of the airtime plan once the full balance of the phone plan had been paid off, O2 said.
There would be three airtime plan options, including a £12 a month option including 600 minutes, unlimited texts and 750MB of data, up to £22 a month for unlimited texts and minutes, and 2GB of data.
The contract would be available on specific phones, including the Samsung Galaxy S3, BlackBerry Z10, HTC One, Sony Xperia Z and the iPhone 4, 4S and 5.