The Contract-Free iPhone Is Simply The First Sign That A New iPhone Is Nearing: "
This morning, the Internet was abuzz with the news that Apple would begin selling unlocked iPhones. The only problem? It’s not true. In fact, it’s no different from what Apple did last year at this time: sell contract-free iPhones at unsubsidized prices.
But that doesn’t mean this move is entirely uninteresting. You may be wondering why Apple is doing this? And why now? Well, it seems fairly obvious that’s it’s an attempt to move inventory before a new piece of iPhone hardware launches in the June or July timeframe. Remember, that’s just a few short months away already.
When Apple first ships its iPhone hardware, it requires that you also purchase an AT&T contract with the device. This is both practical (supplies are tighter), but also because AT&T pays Apple a ton of money for each subsidized iPhone sold. But as time goes on and new hardware nears, Apple is more concerned with moving existing inventory to make way for the new device.
A $500, $600, or $700 (depending on the model and size) phone isn’t going to sell a ton of units — especially since it’s not unlocked — but there will be those who pay the premium to ship it overseas or are comfortable doing the relatively painless process of unlocking the phone themselves (which voids the warranty). Unfortunately, in the U.S., even if it is unlocked, the phone will only be able to work on T-Mobile as well as AT&T, since those are the two (major) GSM carriers. A different chip (CDMA) would have to be in the iPhone for it to work on the nation’s biggest network, Verizon (or Sprint, for that matter).
Because of the price and restrictions, this move will probably have minimal impact on actual sales. So don’t be surprised if when the fourth generation iPhone is announced, if we also hear about a price cut for the current iPhone 3GS down to $99 (just as Apple did last year with the iPhone 3G).
So, it was a nice pipe-dream for a few hours this morning that Apple was going to be changing its policy and selling the iPhone unlocked (as Google offers as an option for its Nexus One). After all, many would take it as a sign that they’ve grown weary of AT&T and could soon partner with another carrier in the U.S. But really, this is just the first of undoubtedly many signs that a new iPhone is coming.