Analyst: Apple to Offer iPhone 3GS as Pre-Paid Option

| Rumor

Apple’s three year-old iPhone 3GS may find new life as the company’s first official pre-paid iPhone option, according to Jeffries analyst Peter Misek (via Forbes). In a research note published late Sunday, Mr. Misek stated that Apple had signed an agreement “with a major global distributor” to look for opportunities to extend the life of the 3GS, including pre-paid options on carriers around the world.

Prepaid iPhone 3GS

TMO Artist’s Rendition of Pre-Paid iPhone 3GS

The iPhone 3GS was first released in June 2009 and was Apple’s flagship device until the iPhone 4’s launch the following year. Apple then kept an 8GB version of the 3GS for sale as a lower cost alternative to the iPhone 4.

With the iPhone 4S launch in October 2011, Apple reduced the wholesale price of the 3GS to $375, allowing some carriers to offer it free to end users on a two-year service contract.

Now, with the phone nearly three years old and the next iPhone expected this fall, many predicted the 3GS would be discontinued. If Mr. Misek is correct, however, it appears that the phone will continue to live on as an inexpensive option for users not willing or able to commit to a wireless service contract.

With Mr. Misek expecting Apple to drop the wholesale price of the 3GS to between $200 and $250, the new low-cost, contract-free iPhone would compete well against Android and Windows Phone-based handsets in many countries and with many consumers for whom pre-paid phones are preferred, as well as introduce new customers to Apple’s lucrative app and media ecosystem.

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Comments

BurmaYank

Cricket Wireless (US, Worldwide & Mexico) is already ready to go with CDMA iPhones (but currently, only jailbroken ones, until/unless Apple signs such a deal with Cricket as what’s discussed above)!

FlipFriddle

Count me in!

Lee Dronick

I am fixing to get ready to dump my landline. However, I don’t want to give out my cell number to just anyone and then deal with the junk calls. So I am looking at my options in that regard. I am considering a prepaid phone. I have two iPhone 3G phones, one is gathering dust and the other is my alarm clock, I could jailbreak one of them. Or I could see if I can get cheaper landline service, no long distance, no caller ID (though that is handy).

dhp

It’s very likely two of those would end up in my house. I love my iPod Touch, but I have to carry a pre-paid phone around, too, because I just can’t justify the cost of the current iPhone plans. And of course I couldn’t have one if my wife doesn’t get one.

ctopher

@dhp - I’m posting “Me too!” like some braid deal AOLer (Thank Weird Al!)

I cannot justify the cost of most phone plans. I use the very inexpensive Virgin Mobile which costs a lot for talkin’ but not much for havin’. (I have to add $20 every 90 days and it’s $0.18 per minute. I rarely have to add more than the minimum) The Verizon pre-paid is even too much for me.

But if Virgin Mobile or the Trac Phone series of providers get access to the iPhone 3G I think I’d shell out for one. I’ve looked at the “smart” phones available on these cheapie carriers and I cannot justify their one-time price, but an iPhone? I think I would do it!

dhp

@ctopher - “Me too!” back at you - I use Virgin Mobile as well.

looper

I dunno—this might be the road to “fragmentation” in the Android sense, where a brand new Android phone can come with any version of the OS from 2.2 to 4.x, and no upgrade path if I buy at the low end.  All new iPhones come with, or can be upgraded for free to, the most recent version of iOS; however, I have an 8GB 3GS that I got right after the price dropped to $49 with contract, in early 2011, and it is _sluggish_.  Unless iOS 5 is a “streamliner” update like Mac OS X 10.6 was, focused more on speeding things up than on new features, I have to wonder if it will support the 3GS.  Apple wouldn’t want even low-end customers like myself to pick up a new iPhone and have a dog-slow UI as our “welcome” to the device; so if the 3GS isn’t phased out, will iOS lose its advantage (attractive to developers, in particular) of rapid and near-universal (on new or recent devices) uptake of the latest version?

Joe

I already have a prepaid iPhone. I bought a GSM iPhone 4 off of Craigslist for $300 (really $200 because I sold my old iPhone 3GS for $100), bought a AT&T/Straight Talk BYOD SIM card kit for $15 and pay $45 for unlimited talk/text and basically unlimited data. It’s a great deal and I can’t think of any other service I’d want.

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