Cellphone Upgrade Mania: Is the Newest Model Worth It?

NEW YORK (MainStreet) — Every year the big cellphone manufacturers - namely Apple and Samsung, but also LG, HTC and others - roll out new phone models wrapped in glitzy advertising campaigns aimed at spurring us to buy.

The Samsung came out a few days ago. The new iPhone will join the party later this year.

The blunt question: do you need the latest model phone?

Really?

It will cost upwards of $600 without a two-year contract and, note, to stay current in the upgrade parade it's imperative to stay free of contracts which is easy enough with Verizon (the Edge plan), T-Mobile (Jump), AT&T (AT&T Next) and Sprint (EasyPay).

Understand: plans that allow upgrades quicker than the usual two years cost more. A Verizon Edge customer, for instance, commits to pay $27.15 per month for 24 months for an iPhone 5S. That is $651.60.

You have to pay half that before upgrading to a new phone - meaning that, in effect, this is a one year contract.

A wrinkle is that Verizon will buy the one-year old-phone from you, so you will pay $325.80 for one year's use of the device.

Bought with a two-year contract, that 5S costs just $199.99.

Verizon sweetens the Edge deal by discounting eligible service plans $10 per month.The math is complicated. But anyway you cut it, Edge costs a bit more and you also relinquish the old phone at upgrade.

Are the extra costs warranted by performance hikes?

Consider, when Apple introduced the iPhone 5S last year, it touted these features: "A chip with 64-bit architecture. A fingerprint identity sensor. A better, faster camera. And an operating system built specifically for 64-bit."

The only breakthrough is the fingerprint sensor which, honestly, is a fine thing but until Apple pairs it with a widely usable payments tool, it is something of a yawn.

The newly introduced Samsung Galaxy S5's features include a 16 megapixel camera, a super sharp display, and - this may be the real winner - waterproofing of the device.