Apple iPhone becomes available from T-Mobile USA six years after it went on sale with AT&T.
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People who prefer T-Mobile USA's network to other networks take note: You can now walk into a T-Mobile USA retail store and buy an Apple iPhone with T-Mobile service. It's been a long, long road to get to this point.
T-Mobile is selling three variants of the iPhone: the iPhone 5, iPhone 4S and iPhone 4. The iPhone 5 requires a $99 down payment (for the 16-GB model) and can be paired with any of T-Mobile's new service plans. T-Mobile is also offering the 32-GB and 64-GB models for down payments of $199 and $299, respectively.
T-Mobile is selling the iPhone 5 at a bit of a discount when compared to AT&T, Sprint and Verizon Wireless, but there's a catch: customers need to make 24 payments of $20, which is added to the cost of their monthly service plan. The other three big network operators charge $199 for the 16-GB iPhone 5 at the register, and have built subsidies into their service plans to recoup the remaining cost of the device.
As soon as T-Mobile customers make that 24th payment they'll own the iPhone, whether or not they stick with T-Mobile USA. The company will unlock devices that are paid off so the owner can use it on competing networks if they wish. (Yes, new iPhones are locked to T-Mobile's network.) The beauty of T-Mobile's new model is that there are no contracts. Customers can leave at any time.
The cheapest plan costs $50 per month and includes unlimited voice, unlimited messaging and 500 MB of data. Want more data? Pay more. There are options that go all the way up to 12 GB per month with a mobile hotspot.
That means the least you can spend on an iPhone 5 with T-Mobile's service is $70 per month when you factor the $50 plan and the $20 device payment together. (Here's a rundown on T-Mobile's new math.)
Some people may be able to pick up an iPhone 5 for free, however. T-Mobile through June 16 will offer the iPhone 5 for no money down to new customers when they trade in an old iPhone 4S or iPhone 4. The trade-in deal includes an additional account credit of up to $120, which depends on the value of the traded-in iPhone. Customers will still be responsible for making the $20 monthly payments on the remaining value of the iPhone 5.
The iPhone 4S (16 GB only) can be purchased from T-Mobile with a down payment of $70, and the iPhone 4 (8 GB only) can be purchased with a down payment of $18. Both devices also require $20 in monthly payments for 24 months.
The iPhone originally launched on AT&T's network in 2007. It didn't expand to Verizon Wireless, Sprint and others until 2011. The iPhone 5 is the first iPhone fully optimized to work on T-Mobile USA's network. Older iPhones, including the 4S and 4, will work, but will be stuck on T-Mobile's slower 2G service in most markets around the country.
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