Thursday, 24 June 2010

So you're off to buy a new iPhone

So you're off to buy a new iPhone: Now what do you do with the old one?

Beyond handing it down to a friend or relative, or selling it on eBay or Craigslist, there are some new possibilities. Several websites are offering cash for your used iPhone and will tell you upfront exactly what they'll pay.

Both NextWorth and Gazelle say they will offer up to about $100 for iPhone 3G models and $200 for iPhone 3GS, the most recent iPhone, in good condition.

Apple's (AAPL) new iPhone 4, which goes on sale today, starts at $199 with a two-year contract.

"In effect, the iPhone 4 is a free upgrade if you have the iPhone 3GS," says Dave Chen, founder of NextWorth.

Chen says he resells the used iPhones in areas where Apple doesn't offer the iPhone, such as South America and Africa.

NEW IPHONE 4: Columnist Edward C. Baig takes a look

National retailer RadioShack is offering similar terms but for in-store credit. You can get trade-in value of about $100 for the 2-year-old iPhone or $200 for the newer 3GS. The net result is the same: On the spot at RadioShack, you can trade in your old iPhone and sign up for the $199 upgrade for the new iPhone.

Caveat: If you expect to get the new iPhone today at RadioShack or other retailers, don't get your hopes up. RadioShack and AT&T stores have phones only for customers who pre-ordered. Best Buy says its stock is limited to mostly pre-orders. Apple Stores expect to have limited inventory for walk-in customers in addition to pre-orders.

The Web's two most popular venues for selling used gear — eBay and Craigslist — take more effort than the websites that resell iPhones. You need to place an ad, and take a picture of your iPhone and post it. In the case of Craigslist, you most often have to agree to meet your buyer somewhere and exchange money. EBay takes a service fee for its troubles.

Sellers on eBay are asking minimums of $200 to $225 for 3GS iPhones in their auctions. Pricing is similar on Craigslist.

No matter what you do with your old phone, you'll want to wipe its data. If you want to give it to a relative or friend, here's what you need to do:

•AT&T (T), Apple's exclusive carrier, suggests bringing the old and new phones into one of its retail stores, where store reps will move data from the old model to the new one and work out a pricing plan for the hand-me-down.

The unlimited data plan that tacked on $30 monthly is no longer available to new customers. You'll need to choose from one of two AT&T plans. Now, $15 monthly buys 200 megabytes of data, which AT&T describes as enough for 1,000 e-mails, viewing 400 Web pages and watching 20 minutes of video. For $25, you get 2 gigabytes of data, bringing you to 10,000 e-mails, 4,000 Web pages and 200 minutes of streaming video. If you go over your limit, AT&T will tack on $15 for 200 MB, or $10 for 1 GB, depending on your plan.

•What if you want to give the old iPhone as a gift but don't want to saddle the recipient with the monthly AT&T fee? A retired iPhone with no phone plan can be used as a pocket Internet device that works in Wi-Fi hot spots and as an iPod, just like the iPod Touch.