iPhone Upgrade Program Loosens, But Doesn’t Eliminate Carrier Control: My Experience

By | September 28, 2015

As usual, Apple had no shortage of customers for its latest iPhone, once again setting opening weekend records, and also true to form, I was one of them. Unlike prior years, I trekked over to the local Apple Store and dealt with the crowds, but I had a good reason: the iPhone Upgrade Program. As I detail in this column, while it may look like just another smartphone installment plan, Apple’s version has a several key advantages: annual upgrades, bundled Applecare+ and unlocked phones. Unfortunately, as I found out, Apple’s marketing information omits a key carrier dependency, something even it’s store employees didn’t fully understand or explain, that renders the purchase still subject to carrier gatekeepers.

iPhone-launch-performance

As Apple describes it, “the iPhone Upgrade Program isn’t tied to a single carrier” with no multiyear contracts. This makes it sound like a BYO SIM affair. You get an unlocked phone, pop in a prepaid SIM or one from a previous phone, restore from iCloud backup and boom: new phone with the same apps, settings and (if reusing a SIM) number. Unfortunately, it’s not that simple. There’s still a powerful carrier control point: device activation.

Upgrade-plan

My journey of discovery into the intricacies of Apple’s program, details even its store employees didn’t understand, began when I reserved the wrong model of iPhone. I had good reason. Since I didn’t hit the online store within minutes of it reopening for iPhone orders, every Verizon model allocated to my store was spoken for. Since I understood the Upgrade Program to provide unlocked phones, I found it odd that I was forced to select a carrier when ordering, but I figured it was just to simplify setting up new service for those adding a line, so with no Verizon models left, I just selected the T-Mobile model of type, color and size I wanted. 

Upgrade_phone_selection

As the column describes, when I got to the store with plans of using the SIM from my existing Verizon iPhone in my new 6S Plus, I got a nasty surprise: each Upgrade model is tied to a particular carrier for activation and can only be unlocked later.

Lemons to Lemonade

Yet all wasn’t lost. As I learned through persistence (none of the Store employees knew this) the carrier dependence only applies to initial activation, once the iPhone is setup, it is unlocked. Read the rest of my adventure for how I discovered a workaround for those wanting to avoid carrier contracts with an unlocked iPhone from day one. It’s not perfect, particularly for those using pre-paid phone plans since you’ll need a contract for at least one month, but with T-Mobile’s pricing and contract flexibility, it’s not too onerous.

The iPhone Upgrade Program offers Apple and customers the opportunity to eliminate any carrier control over new phone purchases and upgrades, but there’s still a crucial carrier dependence that Apple doesn’t fully disclose or rationalize. It’s a critical detail that Apple must not only reveal, but fully explain and justify. One final unmentioned detail is that your first monthly payment includes sales tax on the iPhone’s full value making it substantially higher than the advertised rate. Here’s hoping Apple learns from the opening weekend snafus by improving its documentation, employee training, credit check processing and (ultimately) any carrier control over the initial purchase.

2 thoughts on “iPhone Upgrade Program Loosens, But Doesn’t Eliminate Carrier Control: My Experience

  1. Mike

    Does it matter if I’m halfway through a 2-year contract on AT&T? Do I have to wait until next year to upgrade, or can I do this plan now?

    1. Kurt Marko Post author

      This will work and you’ll have an unlocked iPhone, but you’re still on the hook for another year with AT&T. What I’m less clear about (I’m working through this with AT&T right now) is if they’ll transfer the contract to your new iPhone and unlock your old one so you can reuse it with another carrier or get higher resale value.

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