Want an iPhone but not the two-year service contract that comes with them? Cricket Wireless has an offer.
The wireless carrier, part of Leap Wireless International Inc., plans to become the first pre-paid provider with an iPhone in its month-to-month service offer.
The $55 a month plan comes with unlimited voice and texting, a 2.3 gigabyte data fair use limit per month — and a $400 or $500 price tag on the iPhone.
Cricket is subsidizing the iPhone by $150, far less than carriers whose iPhones require two-year contracts.
“The upfront price will deter a lot of customers,” analyst Craig Moffett at Sanford C. Bernstein & Co. LLC wrote to clients. “But the trade-off for consumers isn’t bad.”
How many Cricket customers can muster hundreds of dollars remains “the largest unknown” in Cricket’s announcement, said a client email from Jennifer Fritzsche, an analyst at Wells Fargo Securities.
Moffett’s note had said about 45 percent of Leap’s customers don’t have a credit card, and half pay their monthly bill with cash — “$500 is a lot of money for this group.”
The payoff, according to Moffett, comes from the $55 monthly bill. It would shave between $25 and $65 off most contract plans’ monthly cost.
Cricket’s news was followed by an unconfirmed online report that Sprint Nextel Corp. would offer the iPhone under its Boost Mobile month-to-month service plans this fall.
A Sprint spokeswoman said the Overland Park company didn’t respond to rumors.
Moffett’s note said a pre-paid offer from Sprint would help it meet iPhone purchase commitments it has given Apple Inc. and help Sprint stand apart from larger rivals AT&T and Verizon.
Cricket will begin pre-selling the phone on June 15; the devices will go on sale on June 22.
Its offer applies only to about two-thirds of the company’s service territory, said Fritzsche, though those customers would be able to roam outside the service map without limit.
Cricket will offer an 8 GB iPhone 4 for $399.99 and a 16GB iPhone 4S for $499.99.
An unlocked iPhone 4 costs $549.99 on Apple’s site, while an unlocked 16GB 4S will set you back $649.99.