It's really a bad time to buy an iPhone. If Apple decided to give me $100 for the iPhone 5 on contract I still would not pull the trigger. My wife had a iphone 4 last year and it ran like crap on iOS 6; and that was a 2 year old phone. As a verizon customer I'm getting raped $220 a month. Saving $100 on a phone that is almost a year old is meaningless (at least for me). If I was on a cheaper service with a low monthly then it might make sense. I want the latest and greatest when I get locked into a 2 year contract. Even after a year these phones show their age.
Yeah. I'm dropping Verizon and going with tmobile. I'm going to buy the 2 phones outright. I'll save about $60 a month and get much more in terms of service. I'm lucky that I live in an area with excellent tmobile coverage, including LTE. If the 5S happens to blow me away I'll sell my 5 and upgrade, but so far the rumors aren't really getting me excited at all.