Many customers buying a new iPhone are buying them without a plan. While it may be tempting to buy a subsidized iPhone, the fact is, in the long run, you may end up paying more by being stuck to a 2 or even 3 year plan and once you make that commitment, you cannot change providers if you are unsatisfied unless you pay a heft early termination fee. In addition, travelers cannot swap their SIMS for a local SIM card in order to get significantly lower rates. According to Apple’s website
“If you buy a SIM-free iPhone, you will need to purchase a GSM-compatible nano-SIM card separately. In the United States, you can purchase such a SIM from AT&T or T-Mobile. When you travel internationally, you can use a nano-SIM card for iPhone 5c from a local GSM carrier.”
Apple mentions AT&T and T-Mobile, which are the two top GSM providers in the United States. I would like to point out that there are plenty of other carriers, called MVNOs (basically, smaller carriers using AT&T’s and T-Mobile’s networks) that offer competitive plans as well. There are quite a few out there and each has its target market but just a few that come to mind are H2O, Red Pocket, Lyca and Simple Mobile.
Apple also mentions the concept of buying a local SIM card. Buying a local SIM card doesn’t mean that you necessarily have to go to that destination and buy it once you are there. There are several online sites, including Cellular Abroad, you can purchase local SIM cards before your trip. Rates drop dramatically for calls and even more for data. You can expect to pay about 1/5th or 1/10 of what you would pay with AT&T, Verizon, etc. even with one of their voice or bundle packages.
However, if for ease of use you do want to use AT&T or another providers service while traveling internationally, be sure to get a bundle. Some carriers will automatically charge you for the bundles you use while others will make you guess in advance how much you need and then charge you astronomical fees if you exceed your plan.
My recommendation is this. If you are going overseas either for a short period of time or you know you will not use or not need to use your phone, then getting a bundle and roaming with your current provider can make sense. If, on the other hand, will be there for more than a few days or need or want to use your phone for Google Maps, find reviews of restaurants you are thinking of eating at, want to check emails or Skype back home without worrying about racking up a huge bill, then do yourself a favor and get a local SIM card.
A word of caution about local SIM cards. Some retailers present their SIM cards as being local SIM card when in reality, these are SIM cards that do work in those destination but have to roam to do so. While they work and while you probably will save money, unless you are going to several countries during the course of a trip, try to get a local SIM card.
Here is a list of local SIM cards for some top destinations: