Apple is going to take the stage tomorrow and unveil what it is expected to, two new iPhones. The iPhone 5S is going to be the successor to iPhone 5, Apple’s existing flagship smartphone. For the first time ever, the company is expected to launch a second iPhone alongside the flagship model. It is called the iPhone 5C, a budget smartphone similar to iPhone 5 and fashioned out of plastic to keep costs down. Cost will be a major factor on which the success and failure of this smartphone will depend upon, an analyst believes that the low cost might encourage customers to pay upfront instead of opting for a two year contract.
T-Mobile launches its Uncarrier initiative earlier this year, it doesn’t require customers to sign a two year contract now in order to receive a subsidy on a mobile device. Roger Entner, an analyst at Recon Analytics, believes that with iPhone 5C, Magenta is “in the right place at the right time with the right product.” Entner predicts that the budget iPhone could make a big difference for T-Mobile. However, since it has dropped contract plans, customers have the option of bringing their own device to the network. A factory unlocked iPhone 5 costs $649.99, the iPhone 5S might retain this price point. Most people opt for carrier contracts because they’d prefer a subsidy on this amount, so while T-Mobile’s contract free plans might be attractive for budget iPhone owners, people who opt for the flagship model just might stick with contracts.
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