Apple kicks off iPhone trade-in program

SAN FRANCISCO — Apple Inc. said Friday that it has launched an iPhone trade-in program at its U.S. retail locations. The program will allow consumers to trade in older devices for credit on new products.

Apple confirmed the program to MarketWatch, but said it is not widely marketing the service. The new program comes ahead of the expected launch of new iPhone models next month that could include an updated version of the iPhone 5 as well as a cheaper model — though Apple has not confirmed any new iPhones in the works, keeping with its penchant for secrecy.

“IPhones hold great value. So, Apple Retail Stores are launching a new program to assist customers who wish to bring in their previous-generation iPhone for reuse or recycling,” the company said.

An Apple representative would not confirm the amount of trade-in credits that would be offered under the program. The amount will vary depending on device and condition. The 9 to 5 Mac blog said trade-in values would likely be in the $250 range for an iPhone 5 in good condition, with an iPhone 4 fetching a range of $80-$140, depending on type and condition.

Carriers like AT&T and Verizon have been offering their own smartphone trade-in programs over the summer, and Apple has been widely expected to follow suit, given that the company is now in intense competition with Samsung as growth in the high-end of the smartphone market has slowed considerably.

Analysts believe a trade-in program can help Apple hold on to iPhone users, as older devices can be used to lock in customers with new devices for another two years.

The risk for Apple is that flooding the market with older iPhones could possibly cannibalize sales of newer products that offer higher profit margins. Toni Sacconaghi of Bernstein wrote earlier this month that Apple could reduce this risk by speeding up the replacement cycle — or the rate at which people upgrade their iPhones. A trade-in program could help customers upgrade their devices more frequently, depending on the terms.

“Our analysis suggests that a decline in the average replacement cycle from (about) 2 years to (about) 1.8 years could fully offset the negative cannibalization impact from used phones to gross profit,” Sacconaghi wrote in an Aug. 12 report.

More in Herald Business Journal

Boeing could help launch orbiting space station for the moon

“We should have a lunar base by now. What the hell has been going on?”

How the Airbus-Bombardier alliance could squeeze Boeing

“It makes Boeing look like they’ve been playing tic tac toe against a chess master,” says an analyst.

More self-awareness could help build a better medical system

Marcy Shimada of Edmonds Family Medicine writes the second in a series about fixing our health care system.

Scratch-and-sniff brochures aimed to prevent disaster

Puget Sound Energy has distributed more than a million scratch-and-sniff brochures to… Continue reading

Jewelry, accessories store Fuego opens second site in Snohomish County

Northwest-based jewelry, accessories and gifts store Fuego opened a new outlet store… Continue reading

Extreme cleaning company Steri-Clean opens in Mukilteo

The first Washington franchise of the Steri-Clean company will celebrate its grand… Continue reading

Justices to hear government’s email dispute with Microsoft

A lower court ruled emails in a drug case couldn’t be searched because they were in Ireland.

Nordstrom suspends buyout after struggling to get financing

A buyout was meant to help the company continue turnaround efforts outside the glare of market scrutiny.

Most Read