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Sprint’s Free iPhone Trade In Offer Not As Great As Last Year

IPhone fans may have been a bit disappointed when the latest models went on pre-order on Friday. The best deals from any of the four major wireless carriers were for half off the $700, the new entry-level iPhone 8 with the trade in of a recent vintage smartphone.

Last year, the deals were twice as good—a free iPhone 7 with a recent trade in.

Then on Monday, Sprint seemed to break with the rest of the industry and return to last year’s free iPhone deal. “You may recall a similar wildly successful offer from Sprint on iPhone 7 last year,” the carrier crowed in a press release.

But analysts were quick to note that Sprint’s “free” iPhone this year is not as good a deal as last year’s offer. And, they said, Verizon (VZ), AT&T (T), and T-Mobile (TMUS) are less likely to follow suit.

To get a free iPhone 8, Sprint (S) customers must activate a new line and trade in an iPhone 7, 7 Plus or one of Samsung’s most recent phones, the Galaxy S8 or S8+, released in April, or the Note 8, released just days ago. In contrast, Sprint and the other carriers accepted two-year-old models in last year’s free iPhone promotions for new and existing customers.

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The five phones that qualify for the Sprint trade in are “the five most valuable smartphones on the market,” noted analyst Walt Piecyk at BTIG Research. “One of the phones on Sprint’s trade-in list is the Samsung Note 8, which just began shipments 3 days ago. Who is trading in a 3 day old phone?”

Beyond those limited few models, Sprint is largely matching its competitors in offering half off a new iPhone 8 with a trade in. The carriers haven’t said anything yet about what deals they might offer on Apple’s more expensive iPhone X model, which doesn’t go on pre-order until the end of October.

The consumer benefit of the half-off offers is offset by the rising value of used smartphones, notes Craig Moffett at MoffettNathanson Research. People are keeping their phones for longer periods, shrinking the supply available in the used market and pushing up prices. For example, a one-year-old Verizon iPhone 7 garners $325 on trade in to used phone seller Gazelle this year versus $255 for a then-one-year-old iPhone 6S last year.

For most of the carriers’ Apple (AAPL) iPhone trade in offers “the trade-in values are high enough to make what sound like attractive offers virtually costless to the carriers,” Moffett wrote in a report on Monday.