SAN FRANCISCO — The much-awaited new version of Apple Inc.’s popular iPhone could get a lift from the return of early upgrade plans being offered by major U.S. carriers, an analyst said Wednesday.
Susquehanna analyst Chris Caso said the decision of carriers, including T-Mobile and AT&T T, to offer plans that allow consumers to upgrade their phones in either 12 or 18 months instead of the typical 24-month period could boost demand for Apple’s new iPhone when it launches later this year.
This could be an even more critical factor since the new iPhones are expected to feature bigger screens and will therefore be pricier.
“The early upgrade plans only cost the consumer marginally more than a traditional plan, and require no down payment to acquire a new phone,” Caso told clients in a note. “In general under these plans, the consumer is paying an additional $2 to $10 per month for the privilege of upgrading early, depending on the timing of the upgrade.”
And with these no down payment plans, the new, higher priced iPhones could be “more palatable for consumers,” Caso added.
The new lease plans in the U.S. could “make it even easier for Apple to raise the iPhone price point, since that price increase would be spread over 24 to 30 months.”
Caso cited AT&T’s 30-month payment plan, which would mean that “an additional $50 added to the entry level cost of iPhone 6 would cost the consumer only $1.67 per month.”
“We think most consumers wouldn’t give that level of price increase a second thought,” he said.
Caso noted that smartphone sales in the second half of 2013 after US carriers ended many early upgrade plans in the second quarter of that year. The new plans, he said, could “reverse this trend, which could act as a tailwind for the upcoming iPhone 6 product cycle.”
Analysts have speculated that Apple will unwrap the iPhone 6 in late summer or early fall.
This article originally appeared on Marketwatch.com