On the face of it, Apple’s planned iPhone trade-in scheme is simply another way for Cupertino to make money.
The programme, revealed by sources speaking to Bloomberg, will allow iPhone 4 and iPhone 4S owners to trade-in their old devices for a new iPhone (or iPhone 5S when it eventually launches), getting money off in the process.
The handsets will then be refurbished before being sold on to new users in emerging markets, specifically China and India.
The scheme is expected to start in US Apple stores soon, with an official announcement likely at next week’s WWDC.
Step back and it’s clear that this is actually a very smart move by Tim Cook and co on a number of levels.
Yes, finances are the main driver. With a tumbling share price and flat growth, it’s another way for Cupertino to add to its bottom line.
But within that, this is a chance to keep current users locked into the Apple ecosystem by offering them a cheaper new iPhone.
Meanwhile, Apple can also deliver ostensibly rejigged handsets to punters in new markets who have been craving these products for years, but have been unable to afford them.
It also represents a multi-tiered approach to the iPhone that is far smarter than Samsung’s ‘flood the market with Galaxy devices and see what happens’ plan.
Apple will launch the iPhone 5S later this summer and likely continue selling the iPhone 4S and iPhone 5 at discounted rates.
There’ll then be a new budget iPhone for emerging markets in particular. And at the most affordable end, refurbished, used handsets that will doubtless come in cheaper than Apple’s boxfresh low-cost model.
Importantly, each of these devices will be able to run iOS 7, admittedly with a varying degree of success.
But the point stands that Apple will be selling a series of old and new iPhones that can run the same platform and receive the same updates at the same time.
That’s a powerful message in emerging markets when Android remains stuck in a fragmentation spiral and Windows Phone lags so far behind as to be an irrelevance.
Apple is basically saying, no matter what iPhone you get, you’ll have the same software experience.
In the meantime, users in the US (and possibly Europe), who have tired of their old handsets can get a taste of the latest hardware without breaking the bank.
In all, it’s a winning solution. One which could easily be regarded as one of Apple’s savviest moves in years.