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US Carriers Dial Back New iPhone Discounts

It seems US carriers, known to enjoy offering subsidised discounts for new iPhones, will be dialing back their promotional incentives for Apple’s latest models.

The launch of a new phone has long seen American carriers offer incentives (as free service and discounts) to lure in customers in a competitive and saturated marketplace.

Deviating from the past, recent reports state Americans are less likely to find promotional deals on the new iPhone X and iPhone 8 models.

Analysts state the move follows customer defection rates dropping to record lows last quarter. They believe as most people already have a mobile phone, there is less urgency to offer costly promotions in a bid to win customers.

Compared to carrier deals offered during the iPhone 7’s launch, deals for the new iPhone 8 & X models have notably dialed back.

Telecom Analyst at MoffettNathanson, Craig Moffett, states of the carriers’ shift:

“In retrospect, there’s some regret on how promotional they were. The iPhone 7 trade-in offers were too easily copied by rivals, resulting in a costly move that offered no competitive advantage”.

Below is a summary of what various US carriers will be charging for the new iPhones:

  • T-Mobile: $300 off a new iPhone if trading in iPhone 6 or newer.
  • Sprint: Save 50% off monthly lease price of iPhone 8 if trading in iPhone 6 or newer, or eligible Android devices.
  • AT&T: 32GB iPad for $100 if purchasing iPhone 8 or 8 Plus on a plan which allows subscribers to upgrade phones as frequently as every year.
  • Verizon: $300 off iPhone 8 or 8 Plus if signing up for eligible plans and trading in a selected phone.

As a matter of context, the promotional offers are all significantly less than they were last year. In 2016, all four major US carriers offered up to $650 credit if customers traded in an iPhone 6, 6S or premium Android phone.

Analysts at Jefferies refer to the new promotional carrier offers as “more rational”, stating last year’s deals significantly impacted carrier margins.

Thus far, US carriers as T-Mobile, Verizon and Sprint have not provided further information as to whether they will offer promotional incentives for the iPhone X.

Using the above as a rough guide, Australian consumers are still holding their breath to see what local carriers will be charging for Apple’s newest iPhone models.

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