U.S. carriers compete for highly desirable Apple iPhone customers

“Much as Apple’s unveiling of a larger iPhone is an opportunity to lure customers away from rivals, cellular carriers view the arrival of iPhone 6 and 6 Plus as a ripe chance to do the same,” Marco della Cava reports for USA Today. “‘We don’t have many iPhone customers as compared to the other big carriers, so we see this as a huge switching window opportunity for us,’ says T-Mobile spokesman Clint Patterson. T-Mobile is offering to buy out existing cellular contracts for up to $650 per family, offered in the form of a MasterCard debit card. While Patterson wouldn’t say how many new customers the program has lured since the iPhone 6 went on pre-sale Friday, he pointed out that a month after initiating the buy-out plan T-Mobile gained 2.5 million new customers. In August, it hit 2.7 million for the month.”

“While Sprint is offering a similar buy-out program, it expires on Oct. 31. Consumers who want to make the switch get a prepaid Visa card loaded with $350 to pay off an existing cellular contract,” della Cava reports. “Those new iPhone 6 and 6 Plus customers must then commit to Sprint’s two-year, $50-a-month Simply Unlimited plan, which is a $10-a-month savings over the regular pricing.”

“With all this jockeying back and forth whenever a hot new phone is released, it begs the question if long-term contracts might all soon go the way of the rotary phone,” della Cava reports. “”The trend is definitely people moving away from a tiered agreement,” says Sprint’s Kristen Wallace, noting that the carrier now offers iPhone 6 fans the option of leasing their smartphone much as they would a car.”

Read more in the full article here.


  1. Hearing this sort of flies in the face of all the jacktards who are constantly braying about the end of subsidies for iPhones. Those losers really enjoy trying to spook Apple shareholders with their persistent drivel.

    I know this is in the U.S. but I’m sure even in China the Big Three carriers are going to do their level best to continue those iPhone subsidies even if the government gives them heat. iPhone users are just too valuable to them to lose. I heard there will be a delay for the iPhone 6 coming to China but when it does get there, the demand will undoubtedly be sky high and the carriers are not going to tell the Chinese consumer they can’t offer subsidies for a product with such high demand.

    1. Quite so. The noise about subsidy (and its possible demise) is pointless.

      T-Mobile eliminates subsidies over a year and a half ago. There are no two-year contracts there anymore. Yet, when you go to get a phone on their site, you still see numbers such as $0, $50, $199… These aren’t prices (with contract); these are down payments (and it clearly states that in fine print). You still have two years to pay off an interest-free loan for the phone, and you still need a good credit to qualify. Fundamentally, though, the two (the phone and the service) have been finally separated and there is no concept of “subsidy” anymore. The distinction is rather fine, but the difference is colossal: you can pay off your loan at any time, and your monthly bill goes down by the amount of monthly loan instalment. You can switch your service anytime, change it, suspend it, terminate it, there is no obligation to continue paying until the end of a contract (there’s no contract). All you have to do is pay any outstanding balance for the phone (if it isn’t paid off).

      The old concept was making carriers tons of money at the expense of the customer. Most ignorant consumers took pride in finishing their contract and staying on “month-to-month”. The idea was “They ain’t tying me down again with the old ball-an-chain again!”. So, they would simply continue paying their monthly plan well beyond contract expiration, so that they can be ready for the next major phone announcement, and then upgrade without having to pay any early termination. The problem was that their monthly plan never went down after their contract expired (and the phone was paid off). From that moment on, they were donating free money to their carrier (until they signed a new contract and got a new subsidised phone). This was absurdly foolish, and carriers loved it (laughing all the way to the bank). T-Mobile was first to break this cycle and hopefully, we’ll see others follow them.

      1. I just had to explain this to my wife today – I usually just take care of the phones, but today she was complaining that her current phone is fine, and why should we pay all that extra money etc… I’ve also had to explain it to a bunch of friends, and they still don’t want to believe it (or just don’t grasp it). Maybe I’ll just point them to your comment here @Predrag 🙂
        It’s about time ATT/Verizon is outed for this crap.

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