With recent discussions regarding a lower-priced iPhone, and how Apple might answer the “mid-range” or “low-range” handset market, today Analysts are predicting that the iPhone 3GS will actually become free with a 2-year contract following the iPhone 5 launch.
According to a note to his investors, RBC Capital Markets General Manager Mike Abramsky suggests that Apple will finally offer up the iPhone 3GS for free with a 2-year contract ($399 full price) in order to more directly and aggressively address the large number of cheap and free Android phones available, and help to counter its momentum. Abramsky invisions this tactic as more than doubling the iPhone’s market, bringing it to 150 million phones versus its current 64 million.
Additionally, Abramsky claims, this will dramatically increase Apple’s growth outside North America. The iPhone 3GS also offers an available $15 data plan – significantly cheaper than offerings for the iPhone 4’s data. Abramsky also claims that this may affect Verizon’s sales, as they do not have a $15 data plan, nor do they have an iPhone 3GS.
The iPhone 3GS has continually remained available while coming down in price. Initially available starting at $199 for a 16GB version on a 2-year contract, the iPhone 3GS dropped to $99 after the iPhone 4 launch, and is currently available for a relatively low $49 on contract with AT&T.