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You could just about buy one second hand for that money yes, but the one they'd be giving him should be new and it's a better phone than the Experia it's replacing. S2 is well worth £70 in my opinion.
all sorted eventually they replaced my xperia with the same model phone. quite pleased but the customer service is a joke. thanks to the girl at the insurance who sorted everything in about 10 minutes,that two phone calls lasting a total of 30 minutes didnt.