Leap Could be Left With $100 Million in Unsold iPhones

News
By Zak Islam
published

Prepaid mobile carrier has around 5.3 million subscribers.

U.S. prepaid carrier Leap Wireless could be left with as much as $100 million worth of unsold iPhone units.

The firm, which operates Cricket Wireless, told the Wall Street Journal that it's considerably behind in its prepaid iPhone sales. When it completes its year-long contract with Apple in June, it's likely to have sold half of the iPhone units it committed to selling.

Apple partners with prepaid carriers in an effort to attract more lower-income consumers. Leap currently has around 5.3 million subscribers but is affected by the fact that it has less network access than America's major carriers.

With Leap's no-contract plan, consumers pay nearly full price for the iPhone but are then charged a lower amount for monthly payments when compared to carriers that require two-year contracts. By paying Apple a small subsidy, Leap offers the iPhone 5 for $500, which is around $150 less than buying the smartphone from Apple itself.

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Zak Islam
21 Comments Comment from the forums
  • Jim_L9
    Ouch!
    Reply
  • slomo4sho
    $500 for an iPhone 5 or $350 for a Nexus 4...Which is the better buy? I guess some people will still pay a premium for inferior hardware and a brand name.
    Reply
  • goodguy713
    Virgin mobile offers the iphone 5 as well but i think its a bit cheaper .. how ever 500 for any phone is to much if you ask me.. personally i think the most i would pay for a phone would be around the 250 to 300 mark any more then that would be a waist considering your looking at upgrading it in 1 to 3 years time.. phones just are not that important especially when most modern phones like HTC EVO 4g 3d can handle most if not all of the functions .. and performs well at around 250 you cant go wrong.. what what point do faster processors and gimics really add any value to phones? other then a name and a marketing scheme ?
    Reply
  • mobrocket
    EBAY is a good market too for a phone

    no matter what thou, if u go with a major carrier u will get screwed up the A
    Reply
  • velocityg4
    slomo4sho$500 for an iPhone 5 or $350 for a Nexus 4...Which is the better buy? I guess some people will still pay a premium for inferior hardware and a brand name.
    The best price I could find for that phone is $450 unlocked. While I do agree the iPhone is overpriced. A lot of people don't care about specs. It's about will it do what they want it to do and how easy is it. As an onsite computer technician. I can say for certain that most non tech savvy people find the iPhone much easier to use. Which is a huge selling point.

    The other problem Android being the fragmentation. You get a new phone from another maker and it is different. A lot of people don't like change they get frustrated because they don't understand what programs are and get frustrated when things look and act different. These people just memorize what to push to get the result they want. With a new iPhone they get that. The new one is just faster than their old one.

    Now this company screwed up big time. People going with some tiny regional carrier because they are penny pinching are not going to spend $500+ on a new phone. If they get an iPhone they are much more likely to bring a used iPhone they got off eBay or Craigslist. More likely they are going to get an Android or Windows Phone they can pick up for $100 to $150. Probably the Android because when people think Windows they think viruses and crashing.
    Reply
  • scrumworks
    Selling iphones is good business only for Apple. I still wonder why people care about those outdated iphones that are so fragile and packs no innovations.
    Reply
  • digiex
    Sell them to the Chinese.
    Reply
  • Osmin
    Does it make sense for a company that goes after the price conscious consumer to get into a large volume contract for one of the most expensive phones on the market? Some business decisions take time to bear fruit or do not fit well with their business model. I believe it’s a case of the latter. I have a Galaxy Note 2 and an iPhone 5. I have a better experience with my iPhone 5 than my Samsung Galaxy Note 2. I prefer looking at the larger screen on the Samsung but the iPhone 5 not only fits better in my pocket but also is easier to use. People like to trash talk the iPhone 5 but it’s like saying I hate expensive BMW Sports Cars because the Chevrolet Corvette is faster and cheaper. My parents, who have experience with both devices, find the iOS experience easier. You don’t have to first read if the app is compatible with your phone before you download and there are no options or return buttons on the bottom of the phone to add complexity. The apps are not always consistent with the look and feel and they must learn the quirks of when to use the option button or tabs. They don’t have to install other stores like the Amazon store app to get the free app of the day, and they don’t have to think about the SD card to store and retrieve information. They find the Android OS a little uglier to look at with the pale looking icons. These are just opinions and I don’t blame them or anyone else that can afford to buy the iPhone because they prefer the experience. They are not iSheep but prefer an easier experience because they are not technically savvy and do not like reading manuals. Just get the phone you like or can afford because the majority of the world cannot afford the Apple experience.
    Reply
  • COLGeek
    Unlock and sell them on eBay? Just a thought.
    Reply
  • madjimms
    Send them into the sun.
    Reply