AT&T is offering a $200 discount on Apple iPads for anyone buying a full price iPhone 5S or iPhone 5C, ahead of next month's expected announcement of a new iPhone.
With a new iPhone 6 expected to be announced on September 9 and in stores by the end of September, it looks like the new promotion, which is available only in AT&T owned and operated stores, is designed to sell off inventory of the older model devices. The promotion could also be used to move older iPads, as Apple is also expected to announce a new full-sized and mini-version of the popular tablet in time for the holidays.
The new promotion may also have another motive: to increase data subscriptions for AT&T. As more and more consumers already own smartphones, AT&T and other wireless providers are trying to encourage customers to add other Internet-connected devices to data plans in order to boost revenue.
AT&T's and Verizon's data share plans are designed to make adding such devices easy and affordable. Adding a tablet to a share plan on AT&T costs an additional $10 a month. Of course, with an additional device connected to the data plan, subscribers may have to boost their overall data plan. For example, two subscribers sharing a 4GB plan for $70 a month, plus device connection fees, may need to boost their plan to 6GB and pay $80 a month, plus the additional $10 fee to connect a tablet to the plan. In all, this particular AT&T consumer is likely paying an additional $20 a month to AT&T.
While the deal does offer a decent discount for consumers, interested shoppers should be aware of the fine print in the offer. For instance, the promotion is only available to customers buying a new iPhone 5S or iPhone 5C through the company's early upgrade program.
This means that customers will have to pay full price for the device or finance it over 24 months. At full price the iPhone 5S starts at $650 for a 16GB version and the iPhone 5C starts at $550 for the 16GB version. Financing the iPhone 5S with the option to upgrade after 18 months will cost $27.09 per month for 24 months. And financing an iPhone 5C with the 18 month upgrade option will cost $22.92 per month for 24 months.
The other catch is that the iPad offer is for iPads that include AT&T cellular access. The basic cost of the cellular enabled iPads generally run $100 more than iPads that only include a Wi-Fi radio. Don't forget that AT&T is also requiring that subscribers sign up for a two-year data plan with the purchased iPad.
The newer, more expensive iPads will be discounted by $200, which means that a 16GB iPad Air, which usually sells for $630 will sell for $430. To sweeten the deal even more for consumers interested in the older iPad Mini with a non-Retina display, AT&T is offering a deeper discount. This device will sell for $200 compared to its usual price tag of $430. Again, the offer requires a two-year data contract for any iPad.
For consumers interested in buying a new iPhone and an iPad from AT&T and for those who don't mind purchasing older models, this could be a good deal.