U.S. consumers who want Apple Inc`s
New phone launches have long offered carriers a chance to gain market share by offering incentives such as free service and discounts. But customer defection rates fell to record lows in the last quarter as most people already have cell phones, a situation that creates less urgency to launch costly promotions to lure customers, analysts said.
Deals for the iPhone 8, 8 Plus and X have been pared back from the deals offered for the iPhone 7. (http://tmsnrt.rs/2f2Gche)
"In retrospect, there`s some regret on how promotional they were," said Craig Moffett, a telecom analyst at MoffettNathanson. The iPhone 7 trade-in offers were too easily copied by rivals, resulting in a costly move that offered no competitive advantage, he said.
The iPhone 8 model starts at $699, while the iPhone X will start at $999, Apple announced on Tuesday.
T-Mobile US Inc
Verizon Communications Inc
But the offers are less rich than last year, when all four major carriers offered up to a $650 credit if they traded in an iPhone 6, 6S or high-end Android device, BTIG Research said.
Jefferies analysts characterized the latest round of offers as a "more rational" approach in a note on Wednesday, as last year`s free iPhone deals weighed heavily on the carriers` margins.
Representatives for T-Mobile, Verizon, AT&T and Sprint did not provide additional details on their marketing plans, such as whether they will offer incentives for the iPhone X.
Even with less generous promotions, the new iPhones should attract enough high-income consumers, including wealthy customers in China, said Brian White, analyst at Drexel Hamilton.
"It`s great for Apple because they`re starting to segment the market more, and now the consumers have more options," he said.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)