iPhone Owners Swamp Resellers with Trade-ins
iPhone 5 (left) and iPhone 4S (right)
iPhone owners who had the foresight to lock in a quote from an electronics reseller have two things to celebrate today (Sept. 12) — the availability of the iPhone 5 and a peak trade-in price for their old phones.
The new iPhone 5 shifts the pricing for older models, which in turn, will affect trade-in prices. Following past protocol, the iPhone 5 16GB will cost $199 with a two year contract, iPhone 4S drops to $99, iPhone 4 is free on contract and the 3GS has been eliminated.
For now, resell prices are holding steady at Gazelle, an online company that buys back Apple products. Currently, an iPhone 4 16GB AT&T in top condition will net up to $180, an iPhone 4S 16GB AT&T up to $290. And, you can still get up to $63 Gazelle for a now discontinued iPhone 3GS.
"It's quite a crazy day," Anthony Scarsella, Gazelle's chief gadget officer, told TechNewsDaily. "We're buying thirty iPhones every minute."
But iPhone owners shouldn't expect trade-in prices to remain at their current levels.
"We are expecting prices to come down soon," Scarsella said. Last year, iPhone trade-in prices dropped 25 percent over the week following the launch of the iPhone 4S.
While the fervor generated by the new iPhone was expected, resellers had concrete numbers weeks before today's launch to support an unprecedented demand for iPhone 5. So far, Gazelle has seen a 700 percent increase in iPhone trade-ins over the past month, compared to the month preceding the iPhone 4S announcement last year, Scarsella said. The top trade-in is the older iPhone 4, but iPhone 4S is running a "very close second."
Will iPhone 5 take market share from other operating systems? Android trade-ins have remained steady week over week and Gazelle has not seen a spike today. Scarsella attributed this to the fact that the new iPhone doesn't offer more than what new Android phones such as the Galaxy S III already have.
But based on trade-ins, the future of BlackBerry looks bleak. BlackBerry trade-ins have increased 30 percent in the past week. "BlackBerry users are abandoning that platform for the iPhone," he said. Trade-ins of the BlackBerry Torch 9800 increased 100 percent in volume.
And while today's announcement did not include the rumored iPad Mini, which already has accessories waiting in the wings [link to come], Scarsella says it will happen. He expects a rush of iPad 2 and original iPad trade-ins come October.