updated 11:00 am EST, Fri January 6, 2012
Carrier takes aggressive approach
National carrier China Unicom will be giving the away iPhone 4S on some multi-year contracts, Bloomberg reports. When the 4S launches in mainland China on January 13th, a 16GB model will be free on a two-year contract costing a minimum of 386 yuan a month. Getting a free 32GB model will require a three-year contract, but at a cheaper minimum of 286 yuan per month.
Alen Lin, a China Unicom specialist with BNP Paribas Securities, notes that the carrier had previously tried offering a 286-yuan rate with a two-year contract, but that it lost money on the proposition. Tying it to a three-year contact will give Unicom "one one additional year to recover the expense," says Lin.
Giving 4S models away for free nevertheless represents an aggressive approach to iPhone sales. In the US the device isn't free on any contract, in spite of high monthly phone and data fees. China Unicom, though, is catering to a market with less income as a rule, and also competing against gray-market iPhone buyers subscribing to rival China Mobile.