Carphone Warehouse offering free iPhone 5 for £39 a month

The Carphone Warehouse is offering the iPhone 5 16GB for just £39 a month - the cheapest way to buy an iPhone, according to the retailer.

The offer is with O2 and will give you 900 minutes, unlimited texts and 100MB data, which probably isn't enough for most smartphone users.

If you're willing to increase the upfront cost to £49 though, you'll get a much more reasonable 1GB data, plus unlimited calls and texts for £37 a month on Vodafone.

The Carphone Warehouse's third top deal is an iPhone 5 16GB for no upfront cost and a charge of £46 a month on Orange. For your pennies, you'll get unlimited data, calls and 3GB data.

Graham Stapleton, Chief Commercial Officer at Carphone Warehouse recommended users carefully consider how much data they need before opting for a tariff with a low data limit (such as the cheapest iPhone deal above):

'We know that iPhone owners typically consume more data than those using any other handset.

'In fact, iOS users average around 400MB of data per month and - as streaming, gaming and browsing on the move become increasingly popular - average smartphone data use is projected to rise to nearly 1GB per user by 2014.

That's why two of our top three deals include the large data limits of 1GB and above. Active smartphone users should carefully consider whether a tariff with a higher limit is right for them, remembering that a larger limit will accommodate for any increasing appetite for data and avoid any potential additional charges in the future, ultimately saving money.'

Earlier this week, the iPhone 5S was leaked, suggesting it may be a device compatible with a wider range of 4G bands, allowing it to work on the Vodafone, O2 and Three LTE networks when they launch next year.

The current iPhone 5 is only compatible with Everything Everywhere's 4G frequencies.