Let’s upgrade you: To encourage adoption of iPhone 5, Apple is set to launch trade-in program for old iPhones

Apple Inc. is reportedly launching an iPhone trade-in program this month aimed at getting users to upgrade to the new iPhone 5.

The trade-in service will allow iPhone users to trade in their current iPhones for a discount on the latest model.

According to reports, Apple plans to launch the new iPhone trade-in program in partnership with Brightstar, a mobile phone distributor. The service would allow iPhone owners to trade in their current phones for a discount on new phones in Apple stores.

Out with the old: Apple is planning to launch a trade-in program in-store for iPhones this month, according to reportsOut with the old: Apple is planning to launch a trade-in program in-store for iPhones this month, according to reports

Up until now, Apple has offered a recycling program, but only offers a 10 per cent discount on iPod trade-ins. There is also a Web-based recycling service for used iPhones, iPads or Macs.

The new trade-in program will allow consumers to receive payment for their devices instantly and avoid the hassle of shipping their older gadgets, according to information obtained by Bloomberg News.

Brightstar already handles trade-ins for AT&T and T Mobile and business in trade-ins is growing at a rapid rate, with AT&T currently paying as much as $200 for working iPhone 4s and 4Ss.

Gazelle, a company specializing in electronic device trade-ins, resells outdated iPhones in emerging markets like Asia or Latin America.

Gazelle CEO Israel Ganot estimates that 20 per cent of U.S. consumers buying a smartphone this year will do so using a trade-in, an increase of nine per cent on 2011.

‘The biggest challenge for us has been to change consumer behavior,’ Ganot told ABC News. ‘It will be great to see Apple jumping into it. We expect them to put the brand and marketing behind it and lift consumer adoption.’

Tricks of the trade: Old iPhones traded in at Apple stores will be resold in emerging markets such as Asia and South AmericaTricks of the trade: Old iPhones traded in at Apple stores will be resold in emerging markets such as Asia and South America

According to Bloomberg, Apple shares have declined 38 per cent since September, weighed down by investor concerns that the company’s era of massive growth, fueled by the 2007 debut of the iPhone, is over.

The program will serve to encourage sales of new hardware in mature markets such as the U.S., where many prospective customers already own a smartphone.

Used iPhones which have been traded-in at Apple stores in the U.S. will be resold in emerging markets, where Apple’s share is lower and demand for cheap devices is greater so that the resale of Apple’s older models won’t cannibalize iPhone 5 sales in the U.S., an insider told Bloomberg News.

Selling used iPhones in emerging markets may also keep first-time smartphone buyers from committing to the Android system.

Apple was once the main player in the smart phone industry, but has lost market share to competing Android phones over the past year. Samsung Electronics Co. became the best-selling smartphone brand in the U.S. in May this year, according to a report published this week.

Latest and greatest: Apple announced the iPhone 5, the latest version of the popular smart phone in late 2012Latest and greatest: Apple announced the iPhone 5, the latest version of the popular smart phone, in late 2012

‘This will help them sell more phones, because it will lower the consumer’s out-of-pocket expense,’ Roger Entner, an analyst at Recon Analytics LLC in Dedham told Bloomberg News.

Getting more people to buy iPhones, new or used, is also becoming more important as Apple begins introducing services that are delivered via mobile devices, according to Walter Piecyk, an analyst at BTIG LLC.

‘The key is to get iPhones into as many people’s hands as possible,’ Piecyk, told Bloomberg. ‘Selling used phones is one way to do that.’

Apple will hold its annual Worldwide Developer’s Conference on Monday, June 10. CEO Timothy Cook, who has hinted that new services are being developed in addition to new hardware, is planning to introduce a new music-streaming service.
Read more: Daily Mail

One comment

  1. u can call it a development but in realiy it is another way of exploiting people internally with this material culture; from iphone this to iphone that with slight differences or non at all.

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