When Apple refreshes the iPhone, usually one model gets discontinued and the other model receives a hefty price cut to make space for the new full-priced iPhone. However, when the iPhone 5 (or at least the next iteration of iPhone) launches, some analysts believe that Apple will want to get into the free smartphone industry. More specifically, Mike Abramsky of RBC Capital believes that the launch of the iPhone 5 will mark the disappearance of the iPhone 3GS’ price tag. The iPhone 4, at the time of the launch, will be marked down to $99, and the iPhone 3GS will stick around for customers who wish to use a free iPhone on a two year contract.
While a free iPhone 3GS on a two year contract does sound great, you’ll be tied down to a lengthy contract and your phone will be behind by two generations. If you don’t need to be on the cutting edge of technology, a free iPhone 3GS would still be a quality smartphone to own.