I got my nexus 4 for 'free' on a contract and even if I bought it outright and got on the cheapest plan with roughly the same features, I would've only saved $5 a month. 5 * 24( 2 year contract) is only 120 so by going on a contract I saved at least $100 on the cost of my phone. If you are smart you can save money by going on a contract.