Q: Should you buy a refurbished or second-hand phone? A: The short answer is no. The long answer is maybe, under some circumstances.
A refurbished or second-hand phone has a large element of risk. Dodgy end-of-life batteries, warranties not worth the paper they are written on, wrong firmware, Telco carrier incompatibility or carrier locked, difficulties getting repairs and much more.
New phones enter Australia in two ways. The correct way is to be fully certified by the three major Telco’s for use on their Australian networks. These are sold either directly from the Telco or via major retailers like JB Hi-Fi, Good Guys, Bing Lee, Harvey Norman, Officeworks, and Retravision.
The chances are that if you buy from a lesser known retailer, it will be a grey market/parallel import, and that opens up a world of pain.
Genuine Australian phones have
- Australian firmware to enable proper billing and tower to tower hand-off
- Modems that support at least LTE Bands 1, 3, 5, 7, 8, 28, 40 and 42 to cover all Australian 4G bands. Of these bands 1, 3 and 28 (4GX, in-building coverage and small cell areas) are vital and the others may location-based, e.g. Canberra needs 40 to get Optus. Vodafone uses band 5 in many areas.
- Can make a 000 call without a SIM (international models can only call 911)
Unfortunately, there is no app to tell you all the bands the phone supports, but if you have the exact model number, you can do a Google Search and usually find the bands it has.
Another way to find if it is supported here is to go to Settings, About Phone and Regulatory.
If you see a C-Tick if it’s certified for use in Australia. No C-tick means it is an international model that may have all required LTE bands but its riskier – avoid it like the plague.
Second-hand is risky to the buyer and the seller
The biggest issue is that you never know the pedigree of the phone unless you can see the original purchase invoice from a reputable brick-and-mortar retailer.
A huge number of second-hand phones started life as parallel or grey imports from dodgy online sellers. These phones were never meant for Australia. Dead giveaways include a not being able to find the C-Tick logo under System, About Phone, Regulatory Labels and international power adaptors.
For sellers, its dangerous to invite someone into your home to see it. Frequent media reports show bashings and robberies as organised gangs see this as easy entry to your home.
There is also a Gumtree/eBay scam alert where a potential buyer emails that he cannot get over to see it but is happy to buy sight unseen and pay the freight. Using a payment loop-hole, the seller is conned into thinking the phone has been paid for and then ships it to a bogus address never to see the phone or the money again.
There is a lot of attention at present on refurbished phones.
There are some schemes offered by Boost (Alegre), Brightstar (major distributor of phones to retailers), Macquarie Group’s numobile (only sells with a Telstra plan), and Apple Certified refurbished iPhone. Samsung has a similar scheme in the US, but it is not here yet.
GadgetGuy is yet to investigate these schemes, but at least you should get a genuine Australian handset from a company that will honour its warranty. What we want to know is whether these phones have a guarantee on the battery life left (easy to measure – see later) and the Australian pedigree.
These companies control millions of leased smartphones via Telco plans or corporate sales. Nu Mobile alone says it has over 1 million smartphones under lease.
BTW – a lease is different from rental or purchase plans. Businesses with an ABN pay a monthly amount (usually the cost of the phone amortised over 24 or 36 months) and return the phone to the Telco or leasing company. They don’t ever own it.
Under a Telstra lease plan If the phone is in good condition, there are no extra charges when returned. If it is scratched or damaged, the business has to pay $229 (minor damage), or $499 (if damaged beyond repair).
However, Telstra has stopped selling phones on lease since 25 June 2019, so this major source of phones for refurbishment will eventually peter out. Telstra now offers a straight purchase plan not subsidised by voice and data plans.
So, at the end of the lease, the Telco or leasing company has a worthless phone unless it can be resold, refurbished or recycled (in order of value).
What is refurbished?
Only Apple operates a genuine refurbished phone market. Apple guarantees you receive a “like new” device with genuine Apple replacement parts (as needed) that has been thoroughly cleaned and inspected. Refurbished iOS devices come with a new battery and outer shell. Every device comes with all accessories, cables and operating systems.
All Apple Certified Refurbished products are packaged in a brand-new white box and will be sent to you with free shipping and returns. They have a one-year limited warranty with the option of getting additional coverage by purchasing AppleCare.
So, it’s safe, but you will pay a lot more – Apple refurbished items are typically only 15% off the new price.
Otherwise, the term refurbished is much abused.
GadgetGuy says unless at a minimum the battery has a couple of years life left (250+ cycles) in it then you are buying a ticking timebomb (see battery information below).
Many refurbishers will spruke comprehensive checklists and Australian warranty (that they provide and may not honour). Some suggest that international phones have new Australian firmware loaded (impossible unless you are the maker and the modem supports Aussie LTE bands). In reality, most just factory reset the phone, clean it up, fit a soft plastic screen protector (to hide scratches), shrink wrap it, and that is about it.
What should you pay for a second-hand or refurbished phone? What is the market value?
As a guide Telcos say that a phone loses value at about 3% a month so after 24/36 months it is worth 28%/-8% of its original value. Frankly, a phone over three years old is worthless – only the price you are willing to pay.
And you need to add or subtract depending on the condition. A phone that has always been in a case and is pristine may be worth say $50 more.
Why is a refurbished or second-hand phone over three years old worthless?
In two words, ‘battery life’. A rechargeable lithium-ion battery has a theoretical maximum recharge cycle of between 300-500 times. Battery capacity (the ability to hold a charge) decreases to about 70% capacity after 250 cycles (typical annual use) and then depending on how it has been treated it may drop to 50% by the end of year two and as low as 0% at the end of year three.
Don’t be fooled – the percentage battery indicator on most phones screens is based on the percentage of charge, e.g. if it only holds 50% or the rated charge and the indicator shows 75%, then it has 37.5% capacity left. That is why phone makers will not change the indicator to show battery health (its remaining capacity).
In the iOS iPhone/iPad world, the free Coconutbattery app will reveal battery health and cycle count. Remember, the cycle count needs to be as low as possible – the maximum is about 500 cycles.
In the Android world, the free Accubattery also shows percentage battery health. For example, my almost one-year-old Samsung Note9 is currently at 90% battery health, so its 4000mAh capacity is now closer to 3600mAh. I use Qi charging most of the time that is kinder than USB charging.
A battery replacement is not easy – it requires screen removal (using a heat gun), and the battery replaced. If not done properly it can ruin any IP ratings or damage the screen. Expect to pay about $100 for most professional battery replacements.
GadgetGuy’s take – Q: Should you buy a refurbished or second-hand phone? A: Caveat emptor
Two main issues – You must have Australian firmware (not just certified for sale in Australia – marketing hype) and decent battery life. The first requires quite a lot of investigation. It is easy to test the battery by installing a free app before you buy.
Ironically, the masses of used smartphones were once shipped overseas for use in third world countries, are now being resold here.
Our best advice is to forget refurbished, swallow your brand loyalty/snobbery and look for a new pre-paid, mass-or-mid-market with a genuine Australian warranty from a reputable retailer – not those shonky online ones that will probably sell you an international model not meant for Australian networks.
There are some incredible new phones for bargain prices.
Nokia covers the market from $149 to $699 and watch out for flash specials at JB Hi-Fi
Motorola g7 and g7 Plus for $399/499 offer great value – the g7 Plus is pretty special
OPPO has the new Reno Z that at $499 has the largest MP camera in the market
Alcatel has the 1 and 3 series that offer a whole lot more from $179 to $279.
Samsung is back with its new Galaxy A-series from $279 to $649 with some spectacular specifications.
You can watch Channel Seven GadgetGuy Val Quinn’s take here.