Starting Friday, Sprint's in-store customers will be able to lease an iPhone 6S with 16GB of storage for $1 a month and the larger iPhone 6S Plus for $5 a month with the trade-in of an iPhone 6.
Sprint's move was announced Thursday, one day after T-Mobile unveiled in-store pricing for an iPhone 6S with 16GB for $5 a month; the Plus version with 16GB is $9 a month. The iPhone 6S and 6S Plus, unveiled by Apple executives on Sept. 9, go on sale on Friday.
Sprint and T-Mobile have been battling for years to improve customer share behind Verizon Wireless and AT&T. In August, Sprint dropped to fourth place behind T-Mobile, even though Sprint reported a record low customer loss rate.
Pricing plans have become the biggest battle ground for all the major carriers, and the fight to win iPhone 6S customers is just the latest round. Sprint touted its statement detailing its latest offer by saying, "Not So Fast T-Mobile! Sprint Beats Your Price with World's Best Offer on iPhone 6S: $1/Month"
Roger Entner, an analyst at Recon Analytics, questioned whether Sprint would win more customers than T-Mobile with a difference of just $4 per month between the plans. "Whether it's $5 or $1 a month is not a big difference, so that alone won't bring in customers" from the other carrier, he said.
However, Entner suggested that both T-Mobile's and Sprint's offers might woo a few customers away from either AT&T or Verizon Wireless. Neither AT&T nor Verizon Wireless offers a leasing plan and each charge $20 or more a month for equipment financing plans, which are technically different from leasing plans, Entner contended.
"It's insane. How much lower can we go?" Entner said. "Carriers are hell bent on continuing to devalue the devices."
With an unlocked 16GB iPhone 6S going for $650, both Sprint and T-Mobile would seem to be losing out on recovering the cost of a device if they charge just $1 a month or $5 a month (the leasing terms vary). But Entner noted that many customers will simply re-apply for another leasing plan when they are eligible.
With Sprint's iPhone Forever plan, customers can get the latest iPhone when it becomes available, which could be just months. With T-Mobile's Jump! On Demand Plan, 18 months is generally required. When customers trade-in an older model, the carriers general refurbish and resell the older models or work with a third party to do so.
"All these contract and device deals are almost irrelevant because people will go to the next deal or the carrier will buy you out," Entner said. "There won't be a financial problem for the carrier."
Also, Entner questioned how many iPhone 6 customers are that interested in trading up to an iPhone 6S to make the deal enticing. "There's only a limited number of those iPhone 6 users, so the impact is not really that dramatic, even though the marketing visuals are quite stark. People might think, '$1 a month for an iPhone 6S -- oh yes!'"
After 18 months, T-Mobile will let a customer buy an iPhone for $125 less than full retail price, or $524. Or, T-Mobile has a deal to allow an iPhone 6 trade-in and pay just $254 for the iPhone 6S 16 GB after 18 months. At Sprint, a customer can purchase the device after 21 months, owing $187, or can keep the device and the rate will revert to $22 a months.