Tech by VICE

The Death of Cellphone Contracts Has Created an iPhone Price War

First Apple undercut the carriers, then the carriers responded in kind.

by Nicholas Deleon
Sep 10 2015, 8:31pm

Image: Apple

T-Mobile just shot the opening salvo of the Great iPhone Pricing War.

The third-largest wireless carrier in the US said today that it will sell the base model of the iPhone 6s for a grand total of $524, or about $125 less than what you'd pay if you went through Apple itself. And for this you can thank the end of wireless contracts.

With the exception of AT&T, none of the major wireless carriers in the US are offering new customers traditional two-year contracts when buying a cellphone. Consequently, unshackling the price of the device from the price of wireless service has enabled the carriers to experiment with pricing. Until today that experimentation plainly meant that consumers would pay the full price of the device, either up front all in one payment or broken up into more manageable monthly payments.

Apple itself is offering the base model of the iPhone 6s for $649, or $32.45 per month. Until this morning, that was the lowest price around for a new iPhone, undercutting the wireless carriers themselves. There are some complications to consider, however, as buying an iPhone directly from Apple will net you an unlocked model, which you can take to the wireless carrier of your choosing. Choosing to save a few dollars today by going with T-Mobile means you'll be locked to its network. Going with Apple also means you'll have AppleCare+, the company's generous warranty program that normally costs $129 over a period of two years.