A few days ago, Apple launched their newest flagship gadget items: iPhone 6 and iPhone Plus. Their arrival has opened up doors for Verizon Communications to devise a new contract plan to attract new and existing customers.
The company is now offering iPhone 6 to customers under a two-year contract in exchange for their old iPhones. According to reports, the new ‘trade in old model’ offer by Verizon makes the latest iPhone almost free against a two-year contract.
The offer entails a US$ 200 gift voucher that can be spent toward purchasing the basic 16-gigabyte version of the iPhone 6, which comes in at US$199.99.
Many observers think that this is a good move on the part of Verizon because they are banking largely on the popularity of the Apple brand to bring in more customers under the carrier’s wings. This would, in turn, ensure significant incremental revenues at the company’s wireless services segment.
While Verizon is busy promoting its 2-year contract plus a free iPhone 6, Sprint Corporation has also come up with its new US$ 50 unlimited plan offering clubbed with iPhone 6. In addition, Sprint’s new campaign “iPhone for life” adopts a new strategy of allowing customers to own a new iPhone every two years upon signing up such contracts. According to reports, the new promotional strategy will potentially allow Sprint to win back customers lost to rival T-Mobile US Inc.
For US$ 20 per month, Sprint is offering customers a basic 16 GB iPhone 6 beginning 19 September 2014, which they can trade in 24 months time from now for the latest iPhone Apple releases at that time. This amounts to US$ 480 in device payments. Technically, it represents paying more for the iPhone in instalments rather than getting it free of cost.
Customers can also select the option of financing the phone over two years for US$ 30 a month after a US$ 58 down payment or else settle for a two-year contract and pay monthly instalments of US$ 20.
However, according to reports Sprint’s current plan is much lower in comparison to the plans that offer iPhones at a hefty US$ 85 per month instalment, which amounts to US$ 1,040 for a two-year plan. Sprint maintains that its US$ 20 instalment is a huge slash from the conventional plans and promises greater value for customers.
With the iPhone 6 grabbing all the attention, everyone expects more operators to join the bandwagon. However, while they may lead to incremental revenues arising from new subscribers, it does call for a reality check for the operators whose profit margins may suffer given hefty waivers on equipment sales.
With the wireless market becoming increasingly saturated, only time will tell how profitable the iPhone 6 turns out be for telecom carriers, given that several such gadget items launch and promotional offers hit the streets every month. However, the upcoming quarterly results will mirror the true financial picture of these carriers post the iPhone 6 promotion, making actual gains and losses more vivid for the companies and investors.
The company is now offering iPhone 6 to customers under a two-year contract in exchange for their old iPhones. According to reports, the new ‘trade in old model’ offer by Verizon makes the latest iPhone almost free against a two-year contract.
The offer entails a US$ 200 gift voucher that can be spent toward purchasing the basic 16-gigabyte version of the iPhone 6, which comes in at US$199.99.
Many observers think that this is a good move on the part of Verizon because they are banking largely on the popularity of the Apple brand to bring in more customers under the carrier’s wings. This would, in turn, ensure significant incremental revenues at the company’s wireless services segment.
While Verizon is busy promoting its 2-year contract plus a free iPhone 6, Sprint Corporation has also come up with its new US$ 50 unlimited plan offering clubbed with iPhone 6. In addition, Sprint’s new campaign “iPhone for life” adopts a new strategy of allowing customers to own a new iPhone every two years upon signing up such contracts. According to reports, the new promotional strategy will potentially allow Sprint to win back customers lost to rival T-Mobile US Inc.
For US$ 20 per month, Sprint is offering customers a basic 16 GB iPhone 6 beginning 19 September 2014, which they can trade in 24 months time from now for the latest iPhone Apple releases at that time. This amounts to US$ 480 in device payments. Technically, it represents paying more for the iPhone in instalments rather than getting it free of cost.
Customers can also select the option of financing the phone over two years for US$ 30 a month after a US$ 58 down payment or else settle for a two-year contract and pay monthly instalments of US$ 20.
However, according to reports Sprint’s current plan is much lower in comparison to the plans that offer iPhones at a hefty US$ 85 per month instalment, which amounts to US$ 1,040 for a two-year plan. Sprint maintains that its US$ 20 instalment is a huge slash from the conventional plans and promises greater value for customers.
With the iPhone 6 grabbing all the attention, everyone expects more operators to join the bandwagon. However, while they may lead to incremental revenues arising from new subscribers, it does call for a reality check for the operators whose profit margins may suffer given hefty waivers on equipment sales.
With the wireless market becoming increasingly saturated, only time will tell how profitable the iPhone 6 turns out be for telecom carriers, given that several such gadget items launch and promotional offers hit the streets every month. However, the upcoming quarterly results will mirror the true financial picture of these carriers post the iPhone 6 promotion, making actual gains and losses more vivid for the companies and investors.
Comments
Post a Comment