Apple to Offer iPhone 3GS Free on Contract?

iPhone 3GS

Tomorrow’s iPhone event is just around the corner. Today, analyst Mike Abramsky with RBC Capital Markets said he expects Apple to introduce a new iPhone this week, possibly an “iPhone 5” or “iPhone 4S”. In addition, he doesn’t  expect Apple to introduce a second, cheaper iPhone model, but instead reduce the prices of its existing lineup.

In fact, he predicts that the iPhone 4 price will drop to the $99 subsidized price, and $499 without a contract. Abramsky also believes that  Apple will retain the iPhone 3GS in its lineup, offering it for free with a two-year carrier agreement, or $399 contract-free.

This would be a significant change from past years because Apple has usually discontinued its two-year-old iPhone models. Last year, when the iPhone 4 launched,  the iPhone 3GS was dropped to $99 with a contract, and later on the price was reduced to $49.

Last June, he expected Apple to offer the iPhone 3GS for free once the iPhone 5 launches.

We expect Apple to reduce the price of the prior iPhone 4 to $99 subsidized ($499 unsubsidized) and the iPhone 3GS to $0 subsidized ($399 unsubsidized, see 11/06/29 note for more detail and rationale); the prior iPhone 4 may be available only with 8GB memory.

Apple is expected to unveil its next-generation iPhone and  iPod touch  on  October 4th  at 10 AM PST,  during a press event. Numerous rumors have suggested that these would be an iPhone 4Sand an  iPod touch  with 3G capabilities (which I don’t see happening).


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Parth Dhebar

Parth Dhebar is a 18 year-old entrepreneur. He is the founder of Simple Reviews, a blog focused on reviewing iPhone and iPad applications. Parth is a recognized name in the industry, known for covering Apple news. He is an editor at Techie-Buzz covering news on Apple. You can follow him on Twitter @pdparticle.