Those Promotions Promising a ‘Free’ iPhone? It Isn’t Free.

Those Promotions Promising a ‘Free’ iPhone? It Isn’t Free.

There’s no such thing as a free iPhone.

But phone carriers would like you to believe otherwise. Over the last few weeks, AT&T, Verizon and T-Mobile have blitzed their websites, billboards and stores with ads proclaiming that you can “get the iPhone 15 Pro, on us.”

To get this $1,000 iPhone for $0, the carriers say, all you have to do is trade in an older phone and sign up for a wireless plan. In reality, the phone freebie promotions can lure smartphone owners into spending more in the long run by requiring them to subscribe to more exorbitant service plans bundled with superfluous features, such as big high-speed data packages and subscriptions to streaming services.

I spent several days plugging numbers into the carriers’ websites and chatting with store representatives to get some realistic out-the-door numbers. To test the promotions, I submitted a three-year-old iPhone 12 as a hypothetical trade-in. (On average, people upgrade to a new phone every three years.)

Here were the costs of getting the new iPhone 15 Pro through the promotions, excluding taxes:

  • Verizon’s free iPhone deal would cost about $3,240 over the 36 months required to redeem the promotion, roughly $300 more than buying the new iPhone with a cheaper Verizon plan in the same period.

  • AT&T’s deal would cost a customer about $2,675 over the 36 months required to redeem the promotion, a little bit more than doing a trade-in for the new phone and selecting a cheaper AT&T plan.

  • T-Mobile’s promotion would cost $2,400 over two years to redeem the phone credit, about $160 more than buying the new iPhone with a cheaper T-Mobile plan.

“People who think they’re getting free phones from the carrier are in for a surprise,” said Toni Toikka, the chief executive of Alekstra, a consulting firm that helps businesses reduce their cellphone bills.

Verizon said that customers could choose which plan was best for them, and that the promotions were intended for people looking for the best network experience. T-Mobile said that deals were not just about free phones and it strove to provide the best value with its premium plans that include perks like Netflix streaming and the flexibility to upgrade frequently. AT&T declined to comment.

If you are looking to save a buck, it is always a good idea to trade in your old phone for credit to shave down the cost of a new one. Just be wary of any promotion offering a freebie.

Let’s dive deeper into the iPhone giveaway promotions advertised by Verizon, AT&T and T-Mobile. Then I’ll share some better ways to save money with trade-ins.

Verizon’s requirements to get a free iPhone 15 Pro are the most aggressive. Trading in an iPhone 12 can earn you $1,000 in the form of bill credits spread out over 36 months. To be eligible, I had to choose a $90-a-month wireless service plan called Unlimited Ultimate. The total cost over the three years would be $3,240.

In contrast, if I traded in the iPhone 12 and picked one of Verizon’s cheaper plans, like the $65-a-month Unlimited Welcome, a basic cellular plan with unlimited data, Verizon would offer $415 for the three-year-old iPhone. The total to buy and use an iPhone 15 Pro on the cheaper plan for three years would be $2,925.

The main benefit of Verizon’s pricier Unlimited Ultimate plan is that it offers 60 gigabytes of mobile hotspotting, which allows you to share a phone’s cellular data connection with a computer. Some people may want this feature, but most will not need it — only 4 percent of mobile users consume more than 50 gigabytes of cellular data a month, according to a report by the technology conglomerate Cisco.

So with Verizon’s free iPhone promotion, you would spend $315 more over three years for a plan with fancy perks than if you traded in your old phone and picked a cheaper Verizon plan.

AT&T is offering up to $1,000 off the iPhone 15 Pro with an eligible trade-in. Only the most recent and most expensive smartphones, like last year’s iPhone 14 Pro, are eligible for the full $1,000 in credit. Older phones get less.

AT&T provided a promotional credit of $700 for the three-year-old iPhone 12 in the form of discounts spread out over 36 months of bill payments. That brought the cost of the iPhone 15 Pro to $8.30 a month spread out over three years.

To get the promotion, I also had to choose one of AT&T’s eligible data plans, which start at $65 a month. All told, including one-time fees, the cost of buying an iPhone 15 Pro and using it on AT&T’s network with an eligible plan over three years came out to $2,675.

In contrast, if I traded in the iPhone 12 and picked one of AT&T’s cheaper plans, like the $50 Value Plus plan, AT&T would offer $200 in credit for the older phone, which shaves the price of the iPhone 15 Pro down to $800. Over the course of 36 months on the cheaper plan, the total would be $2,635.

The main difference between the $50 plan and the $65 plan is that the latter offers three gigabytes of mobile hotspotting.

This means you are not getting a free iPhone from AT&T through this promotion. Instead, you would pay roughly $40 extra over three years for a plan with a mobile hot spot feature.

T-Mobile is offering to make the iPhone 15 Pro free once you trade in your older phone and sign up for its Go5G Next plan, at $100 a month. The free iPhone comes in the form of bill credits spread out over 24 months. Over two years, you pay about $2,400.

But if you sign up for the cheaper Essentials plan at $60 a month, which is not part of the promotion, T-Mobile will offer $200 for the iPhone 12. After you buy the iPhone 15 Pro for $800, the total cost over two years would be $2,240.

T-Mobile’s cheaper Essentials plan includes 50 gigabytes of high-speed data, which is more than enough. The Go5G Next plan includes unlimited high-speed data and subscriptions to Netflix and Apple TV+.

Once again, you are not really getting a free iPhone, but are paying roughly $160 more over two years for extra data and streaming services.

“Consumers may find it challenging to determine whether the more expensive plan offers additional value,” Mr. Toikka said.

Promotions are temporary, so once the terms expire, the wireless service rates will probably shoot up — and you could end up spending more without noticing.

But don’t let these promotions discourage you. It’s still a great idea to sell your old phone to save some bucks on a new one, and there are a plethora of trade-in programs online.

Sites like Gazelle, Best Buy, Amazon and Swappa offer cash or store credit for your old phone, and their quotes for used phones are usually higher than the phone carriers’. To reduce costs of your phone, shop around for the best offer and pick a wireless plan that suits your budget and needs.

I recently sold my wife’s iPhone 12 through Gazelle for $312 in cash, which she used toward buying an iPhone 15 directly from Apple. That shaved the price of the new phone down to about $500, and she stuck with the cheap family plan that she has used for years with her siblings.

That’s a far cry from free. But it beats burning extra cash on a fancy wireless package she won’t use.




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