AT&T: iPhone 3GS sees sellouts, more new customers than any non-iPhone device

“AT&T is seeing an unprecedented uptake of the iPhone 3GS after price cuts and just recently going free on contract, the company’s wireless head Ralph de la Vega said during a call discussing summer results,” Electronista reports.

“There was still ‘tremendous demand’ for the now two-year-old phone to the point where inventory was being sold out,” Electronista reports. “It was also the phone of choice for more new customers than any non-iPhone device.”

Electronista reports, “The fall launch of the iPhone 4S and the now-free 3GS pricing were poised to lead AT&T to its best smartphone sales ever in the fall, de la Vega added.”

Read more in the full article here.

42 Comments

      1. I think so too but will withhold judgement for another week. On the latest 4.x updates, things would be snappy for a week or so, but then start lagging until a manual restart or hard reset cleared whatever was slowing it down.

  1. I’m really surprised that iPhone 3GS lives on. However, I’m actually glad, because I plan to buy a used one soon, to use with my AT&T GoPhone account (pre-paid). I currently use an original iPhone (1st gen) with it, which I bought used about 18 months ago. It’s been a good fit for my needs.

    The longer it is “sold as new,” the longer it will be supported (at least partially) by the latest iOS release. It should be supported during its two-year contract period, so now I expect iOS 7 (the version released in 2013) to support iPhone 3GS.

    1. Concur; Apple should continue supporting the 3GS with at least security and major bug fixes (now that incremental system updates are possible) for about 1.5 years (2-year contract minus early upgrade eligibility) after they officially discontinue the 3GS, whenever that happens… probably next summer, when the iPhone 5 comes out and the 4 becomes the new $0 contract phone.

      The last update for the iPhone 3G was a mere 5 months after the model was officially discontinued. Not cool…

      1. The iPhone 3G was supported (at least partially) by iOS 4, correct? It was “sold as new” for $99 until the iPhone 4 was released in June 2010. iOS 4.x was the latest and greatest iOS version until October 2011.

        So, it seems to me that iPhone 3G was supported with the latest iOS for about 15 to 16 months, even if the unfortunate customer bought one on the last possible “new product” date.

        1. The last iOS update to support the 3G was v4.2.1 released Nov 22, 2010. So even though you could update to iOS 4 (bad idea, some friends did, they got severe slowdowns but almost no useful features on the 3G), updates ended after only 5 months, like I originally said.

  2. That’s why an Apple product is always a wise investment, especially in these tough times. Compare the 3GS with an Android phone that was launched at the same time – the G1. After two years, the first Android phone of HTC (for Hopeless Techie Crap) is hopelessly stuck in heritage Android OS which is not even supported by Amazon for its Kindle app. Hopelessly obsolete & painfully slow, it’s a pricey & heavy feature phone to lug around. Android buyers be warned; you’re just a pawn in the money game of Google & handset manufacturers.

    1. so true my HTC Inc. hasn’t seen an update since I got it and I hear there are no plans to update it…once considered the best Android phone on VZW…I got sold on the specs at the time….never again

      1. Never buy in specs alone but the whole ecosystem and support. Isn’t that Apple’s whole and critical advantage over Android? Not to mention more stable and secure code. Android is for geeks only, not normal folks who just want a confident consistent experience in a solid consumer product. If it’s a gardened wall, the wall is up around a tech Eden. I can handle that.

    2. Yep gotta agree.

      Unless you plan on rooting and installing a custom ROM you may be stuck on whatever rev of android shipped on your device.

      My incredible didnt see an official release of gingerbread until this past june. That was months after the OS was released.

    1. That’s basically how I use my older iPhone currently, bought used for $115. It’s an iPod touch that can make phone calls. It costs me a minimum of $25 every 90 days, because that’s how often I have to buy addition pre-paid minutes (as a minimum) with AT&T GoPhone. Unused minutes “roll over” to the next period. I don’t use their option for data, because I am often at a location with WiFi access.

      With all those iPhone 3GS owners now starting to upgrade to iPhone 4S, there should be a glut of used ones being sold on eBay. Hoping to get one it good shape for under $150.

  3. There are some great deals out there. I switched our family of 6, including 4 girls at university, from Verizon to AT&T when the first iPhone came out. AT&T started out poorly but got very good over those 4 1/2 years. I had the only iPhone, but the rest of the family was clambering for them this time around. With that many data plans to pay for, I shopped around. I liked Sprint’s unlimited plans, which included unlimited texting. The real saving, though, was a lower cost family plan. A surprise bonus, which I haven’t seen advertised, was that they bought our old iPhones at a price well above market because of our move from AT&T. I don’t know if it’s Sprint or the 4S antennas, but the signal is much better than before. We couldn’t get enough signal at home to make calls and had to go out on our deck to text. Now, we can do both from inside, and I’m going to be able to get rid of the land line. And very little of this can be found in the typical price comparisons you see online.

    1. It’s because AT&T uses a completely different network. I live in a big city, but at the particular location of my home, AT&T’s signal is relatively weak. I also tried T-Mobile, and it was also weak. Verizon and Sprint were both VERY strong, back when I used those services. It had very little to do with phone itself (or its antenna).

  4. A sucker is born every minute.
    — erroneously attributed to P.T. Barnum

    With today’s birth rate, it happens much more often.

    And those suckers buy a 3GS, rather than a 4, to save $100 on a two year contract that costs close to $100 PER MONTH!

    Meanwhile they will have to live for the next two years with the limitations of a two year old phone.

    The saying “Penny wise and Pound foolish” also comes to mind.

    1. The word “free” makes it attractive, and makes it an easy sale for the salesperson. They probably prefer to sell an iPhone 4S, but if they are out of iPhone 4S, the AT&T salesperson still wants to make an immediate sale (and get commission)… “How about the iPhone 3GS? It’s FREE!”

        1. Yes. Bought used about 18 months ago for $115 (including shipping) on eBay. I use it with AT&T’s GoPhone service (pre-paid). I use it like an iPod touch that makes phone calls. It runs iPhone OS 3.1.3, which is probably a good thing for the old hardware.

          In my opinion, the original iPhone is the best-looking iPhone before iPhone 4. But I’m starting to look for a used iPhone 3GS (for under $150), now that so many owners are currently upgrading to iPhone 4S (all at once).

    1. Actually, I have a 3G that only recently began to feel sluggish. The screen also feels “dated.” I attribute these views to the fact I purchased an iPad 2 and have that as the comparison. iPhone 4S will be under the Christmas tree!

      1. Will you give iPhone 3G to a family member or, if they are already equipped, maybe to a kid from poor family (though it is easy technically)? Apple collects its old products, so this might the way, too.

    2. I have my original iPhone but it’s not used (saved as a sentimental souvenir). I use an iPhone 4 and I still need to update it to iOS 5. Just been waiting for the online hordes to die down.

  5. It seems that Apple has to give away phones like others (this is worse BOGO with contract – of course I know carriers pay for it). Good for them, but maybe the tone should be measured in the future when criticizing others for doing so.

    1. The “criticizing” and ridicule was probably because the competition (especially RIM) were doing FREE and two-for-one offers on their latest products, just to get the unit sales number higher.

      Apple is offering a phone design that is more than two years old at this point. And it is apparently selling quite well. What does that say about the long-term viability of iPhone as a platform.

      And it’s not any less profitable for Apple. The fine print on the iPhone 3GS Apple Store listing says, “For those who are not eligible for an early upgrade or who wish to buy iPhone 3GS as a gift, the price is $449.” Since it is now “free,” AT&T is therefore subsidizing about $450.

      A contract-free iPhone 4S reportedly costs $649 for the 16GB ($199) model. So the subsidy is about $450 there as well.

      Therefore, Apple’s profit on an iPhone sale is about the same, no matter what iPhone gets sold. That’s quite amazing, of you think about it. Apple does NOT “give away phones like the others.” The purpose (and end result) of the “free” phone for Apple is VERY different.

      1. The original ATT data plan was $20/month, which corresponds directly to the amount of subsidy that all carriers provide. 24 X 20 = 480. But the carriers are willing to do no penalty upgrades after 18 months, so the discounted subsidy is 18 X 20 = 360. Because not all subscribers upgrade that early, the amount of subsidy payback is between $360 and $80, probably in the neighborhood of $400/$410.

        Apple charges a premium for buyers of unlocked iPhones.

        1. The exact dollar number is not so important. The IMPORTANT point here is that Apple probably makes as much overall profit (per unit) on the brand-new $199 iPhone 4S as it does on the (more than) two-year-old “free” iPhone 3GS… even a bit more profit on the 32GB and 64GB models. And THAT is quite remarkable.

          So, the purpose of continuing the iPhone 3GS is to expand the iPhone audience to customers who are not willing to pay $200 (or even $50) up front, even if the total cost of ownership after two years is not that different. Apple does not care so much which model and config is being sold, as long as it’s an iPhone.

  6. I’m thinking the iPhone 5 will come out sooner than later. Probably next year in June and the iPhone 4 will take the place of the free iPhone. It’s making me seriously consider waiting for the 5. Offering a “free” iPhone is new for Apple, and the 3GS will be pretty old in another year. Cause you know iPhone years are worse than dog years.

      1. Maybe… but I think it will be September (or even August), so that revenue from the initial sales surge of the first few weeks will fall into the September quarter. I think iPhone 4S was intended for September, but additional time was needed to fully test out the near simultaneous release of iPhone 4S, iOS 5, Mac OS X 10.7.2, Siri, iTunes 10.5, and iCloud.

      1. Sure, but nether you or me know how much ATT pays for said model, and I am inclining to believe that since they had the exclusive on that model, being a GSM model, ATT is juicing it for all it’s got. Besides, once you buy an iPhone, you probably will upgrade to a new model since you are already invested in the platform.

  7. Hilarious !!!

    Sprint gets iPhone , and now it’s their top selling
    Smartphone , AT&T , can’t keep a 2 yr old iPhone
    In stock – Android people – what does that tell you ???

    And yet they’ll STILL argue with you that android is
    Better !!! LMAO !!!!

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