Unlocked Apple iPhone 4 Priced as $649 in Apple Store

Unlocked Apple iPhone 4 Priced $649 in Apple Store

Almost one full year after the iPhone 4 first hit the streets, Apple has started selling unlocked iPhone 4 smartphones via its US store. Visitors at the online Apple Store can select from a 16GB unit for $649 or a 32GB unit for $749. Customers can choose from either white or black flavors.

Apple’s online retail store commenced selling iPhone 4s in an unlocked state this morning. This could be the thin end of the wedge, with consumers in countries in which Apple currently doesn’t sell unlocked models of the phone hoping this offer will be emulated internationally.

An unlocked phone is sold as a standalone piece of hardware without any commitments to — or subsidies from — any single mobile network, and it is ideally suited for users who travel internationally and swap out the phone’s SIM cards to get a local rate for communications. But it’s also beneficial for users who want the most coverage for their device. For example, if the user moves into an area with no coverage from one carrier, he can switch out the SIM and replace it with one from a carrier that does have coverage in that area.

Available only in the U.S., the unlocked devices are GSM-compatible, meaning users can place calls on either AT&T’s network or T-Mobile’s without having to sign a two-year contract for either carrier. The catch, however, is that the unlocked iPhone won’t support T-Mobile 3G download speeds.

For those of you unfamiliar with mobile network standards, you can not use these devices on CDMA networks such as those operated by Verizon and Sprint in the US. You can use these phones on T-Mobile’s network, but you won’t get any 3G or “4G” signal, since the phones don’t support T-Mobile’s non-standard 3G and 4G bands. However, the unlocked iPhones work very well, 3G included, in most of the world.

“If you don’t want a multiyear service contract or if you prefer to use a local carrier when traveling abroad, the unlocked iPhone 4 is the best choice,” Apple’s description of the device reads. “It arrives without a micro-SIM card, so you’ll need an active micro-SIM card from any supported GSM carrier worldwide.”

However, U.S. buyers wanting iPhone 4 now and option to upgrade to iPhone 5 in a few months could pay more now, upgrade for lower subsidized price later and resell the older phone one eBay — quite possibly recovering most of their investment. That circles back to grey market sales. International resellers will pay more per phone but presumably have freedom to buy more of them. AT&T charges $325 to break a contract. That makes the cost of iPhone for resale $524 or $624, depending on model — a $125 price increase easily recovered on the grey market. For example, just across the border in Mexico, it’s not unusual for iPhone to sell for $800 or more. Grey marketers may make a little less per phone but could sell more of them, easily.

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