Apple confirmed that it would soon start an iPhone buyback program. The company’s goal is to increase sales of new devices through this buyback of older models. These devices will be sold again in emerging markets , so that Apple can continue to increase its market share.
Bloomberg mentions this move as a novelty, but this is not entirely true: Apple has already had a program to accept iPhone from a previous version as part of the payment for the new iPhone 5 last August (US only). The value of the credit offered by Apple was up to $345 in the Apple store for a 4 or 4S used. This was just before the release of the current 5 .
By partnering with mobile phone distributor Brightstar Corp. Apple’s intention is to make the upgrade to the latest model easier than ever . In the US, AT&T currently pays up to $200 for an iPhone 4 or 4S, which allows users to buy an iPhone 5 at zero cost, as long as they sign a two-year contract with the company and at the chosen rate (or higher).
According to Israel Ganot, CEO of Gazelle Inc, an online mobile commerce company:
This also means that Apple intends to increase its secondary market , since according to sources at Bloomberg, the collected used iPhones are resold in emerging markets, where demand for iPhones is high, but Apple’s share is low or even non-existent due, in part, to its high access price.
The new partnership with Brightstar will allow the company to execute this redemption program in Apple’s retail stores with immediate payments, as explained in iPhoneinCanada. This makes it easier for the customer, as it eliminates the hassle of having to send the old device to another company offering such services, wait for payment on the device, and then travel to an Apple Store to purchase a new iPhone 5.
Of course, this is a rather strange move for Apple, but it will probably result in an improvement in Cupertino’s company’s profits and at the same time in a significant increase in market share in certain countries . Furthermore, this move could seriously hurt the second-hand market among private individuals, at least in the countries where Apple is implementing this plan.
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