First Pre-Paid iPhone Hits US June 22: 5 Things To Know

on May 31 2012 11:36 AM
iPhone 4
iPhone 4 Reuters

Leap Wireless International Inc., which owns the Cricket cellphone service, said on Thursday it will start selling Apple Inc.'s iPhone next month, making it the first mainland U.S. prepaid wireless carrier to sell the device here on a no-contract basis, according to Dow Jones Newswires.

5 Things to Know Before Making a Purchase

Release Date and Price

Starting June 22, the San Diego company will offer the 16-GB iPhone 4S for $500 and the 8-GB iPhone 4 for $400. Each phone will be compatible with the Cricket Wireless data plan.

Data Package

The iPhone 4 and 4S will come with an unlimited data package with a fair use policy for $55 per month. Full speed data will be supplied for up to 2.3GB per month, after which the service will be slowed.

Where to Buy

The phone will be available at Cricket Co.-owned stores as well as other select dealers throughout the country. The phones will also be sold on the company's website.

Competition

Although the unlimited data package is considerably cheaper than U.S contract networks such as AT&T and Verizon, the iPhone sold through Cricket will cost considerably more money.

AT&T, for example, sells the iPhone 4 for $99 and the iPhone 4S for $199, with different data packages. Larger carriers have noncontract options, but the handsets are more expensive and data packages cost the same price.

Cricket will likely subsidize each iPhone by about $100 to $125, J.P. Morgan analyst Philip Cusick, told Dow Jones.

Such expensive phones are nearly irrelevant to prepaid customers who aren't likely to shell out so much cash at one time. However, we do believe that the iPhone could benefit Cricket in terms of driving traffic to the store, with most customers choosing a more reasonably priced device instead. Given the launch is in the slow summer months, it could be a nice traffic driver in 3Q, Cusick said.

Network Coverage

Leap Wireless aims its no-contract service at low-income households. Its network is limited in some cities and for more-extensive coverage it has used Sprint's network, the Associated Press reported.

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