Cricket Wireless Sees iPhone Sales Plummet
February 28, 2013 8:21 AM
comment(s) - last by
Carrier could have $100 million worth of unsold iPhones by midyear
The iPhone 5 has been a
for most carriers around the world. However, Cricket Wireless – the no contract prepaid network operated by Leap Wireless -- isn't having luck selling the iPhone 5 and is seeing stock levels climb as consumers opt for other devices.
Leap Wireless says that it believes it will sell about half as many iPhones as it committed to sell during the first year of its contract with Apple, which ends in June. Leap Wireless believes that the poor sales could leave it with as much as $100 million worth of unsold iPhones by the middle of 2013.
Leap Wireless has 5.3 million subscribers and areas where it can sell the iPhone are limited by its limited network coverage. Leap was the first of the major prepaid carriers in the US to offer the iPhone last year.
Perhaps the biggest challenge facing Leap Wireless and other prepaid carriers who offer the iPhone is one of cost. While carriers that require a contract, such as AT&T and Verizon, are able to
subsidize the cost of the iPhone
making it significantly cheaper up front, Leap charges the full retail price of $500.
Considering that pre-paid carriers tend to attract customers shopping on a budget coming up with $500 could be a stretch for many subscribers leading them to “cheaper”, subsidized phones.
Wall Street Journal
This article is over a month old, voting and posting comments is disabled
2/28/2013 10:49:14 AM
Let the market decide, I for one will not be renewing my contract with a new subsidized phone. Instead, I will pay full price and simply go month to month.
2/28/2013 1:35:52 PM
Yes, but it sounds like (at least in this case) you're not an idiot. Most people are, and they're easily cowed by marketing and propaganda.
2/28/2013 3:36:32 PM
I would love to let the market decide. Unfortunately the carriers won't let it. Except for T-Mobile, they all charge you the same monthly service fee (which supposedly includes subsidy) whether or not your phone is subsidized (in contract).
You buy a $700 iPhone for $200 and a 2-year contract at $75/mo. The $500 price subsidy over 24 months + interest works out to about $25/mo. So the service actually only costs $50/mo, and the extra $25/mo is to pay for the phone. But after the 2 years are up, the carriers continue to charge you $75/mo. Meaning the market perceives the extra $500 for the phone as "free" when in reality it's the carrier stealing money from them once their contract is up.
The FTC really needs to force carriers to turn these subsidies into a loan. If you want a carrier-subsidized phone, fine. But the subsidy has to show up in your bill as a separate line item, and it has to disappear once your contract is up.
"We can't expect users to use common sense. That would eliminate the need for all sorts of legislation, committees, oversight and lawyers." -- Christopher Jennings
Apple Earnings Worry Investors; Stock Falls 10 Percent
January 23, 2013, 7:06 PM
As T-Mobile Moves to End Smartphone Subsidies, Verizon CEO Says "Not so Fast"
January 7, 2013, 3:36 PM
Tim Cook Touts Apple’s Product Portfolio, Performance in Letter to Employees
October 21, 2014, 8:05 AM
Buoyed by Strong iPhone Sales, Apple Reports Revenue of $42.1B, $8.5B in Profit for Fiscal Q4
October 20, 2014, 5:21 PM
Windows 8.1 + Android "Sell Mini PC" w/ Bay Trail Creates New PC Form Factor
October 20, 2014, 5:07 PM
OnePlus to Open Pre-orders on October 27
October 20, 2014, 1:34 PM
Apple Releases iOS 8.1; Adds Apple Pay Support, SMS Relay, Instant Hotspot
October 20, 2014, 1:00 PM
Quick Note: Android Gmail App to Gain Yahoo, Outlook Account Support
October 20, 2014, 9:15 AM
Most Popular Articles
Update: Motorola Droid Turbo Coming Oct 28, 48-hour Battery Life Confirmed
October 19, 2014, 9:19 PM
Google Announces Android 5.0 “Lollipop”, Nexus 9 Tablet, and Nexus 6 “Phablet”
October 15, 2014, 12:41 PM
Cool Science Video of the Day: Carnivorous Leech Eats Giant Jungle Worm
October 16, 2014, 6:44 PM
HBO, CBS Lead Charge to Ditch Cable
October 16, 2014, 4:40 PM
PS4 "Masamune" Update 2.0 Will Bring New Music and Customization Features
October 17, 2014, 1:05 PM
Latest Blog Posts
The Surface Mini That Was Never Released Gets "Hands On" Treatment
Sep 26, 2014, 8:22 AM
ISIS Imposes Ban on Teaching Evolution in Iraq
Sep 17, 2014, 5:22 PM
Space Terrorism is a Looming Threat For the United States
Apr 23, 2014, 7:47 PM
Facebook Aims to Provide Internet to "Every Person in the World" with Drones, Satellites
Apr 1, 2014, 10:20 AM
Retail Mobile Sites Experience Outages in Light of Simplexity's Bankruptcy
Mar 14, 2014, 8:48 AM
More Blog Posts
Copyright 2014 DailyTech LLC. -
Terms, Conditions & Privacy Information