Apple to begin trade-in program for the Apple iPhone

Apple is getting together with phone distributor Brightstar to offer a trade-in program for the Apple iPhone. Brighstar already handles trade-in programs for a few phone manufacturers as well as carriers like AT&T and T-Mobile. For Apple, it might mean having to dig into its large mountain of cash to pay those trading in an iPhone, but it also could lead to the purchase of a new phone to replace the trade. AT&T is currently offering $200 for a working Apple iPhone 4 or Apple iPhone 4S which would be enough to trade up to a 16GB Apple iPhone 5 on contract.

So what will Apple do with the older models of its iconic smartphone that it purchases in a trade? According to those familiar with Apple;s intentions, the Cupertino based tech titan plans on selling them in emerging markets. The goal is to prevent first-time phone buyers in emerging markets from continuing to buy cheap Android flavored models. And by keeping the resale of these devices out of the U.S., the cheaper models won't cannibalize Apple iPhone 5 sales in the U.S.

Apple already has an online recycling service with PowerOn Services that buys back used Apple iPhone and Apple iPad units. The partnership with Brightstar will be available in Apple Stores only and those trading in an Apple iPhone will receive immediate payment for their trade. Brightstar started its trade-in division a year ago and is on pace to purchase 15 million devices from AT&T and T-Mobile customers. The company ownsa subsidiary that provides refurbished smartphones to clients who have had their insured handset broken or gone missing.

source: Bloomberg