Apple

AT&T Has a Heavily Discounted iPad to Sell You


The iPhone 5S and 5C are going to be become significantly less novel very soon, with Apple (AAPL) expected to release new versions of its phone next month. In the meantime, AT&T (T) is trying to clear last year’s models from the shelves by throwing in a heavily discounted iPad Mini.

Here’s how it works: If you’re willing to visit an AT&T store to buy one of the phones, AT&T will also take $200 off the price of an iPad. A 16GB iPad Mini is discounted even further—to $200, from a $430 list price.

There are a few strings attached. To take the deal, a customer also has to agree to a two-year cellular contract for the tablet. This makes the $200 figure a bit misleading, since you could already have gotten $100 off the list price by agreeing to a contract. The actual savings is more like $100—or $130 if you take the specific model that AT&T wants to move. Still, that’s not nothing.

The iPhone also has to be purchased through AT&T’s NEXT installment plan, rather than agreeing to a two-year contract in exchange for a subsidy for the device. For an iPhone 5S, that means you don’t have to shell out $200 on the day you buy it, but you will have to pay about $27 a month for the next two years, which will add up to an additional $450 more over the life of the phone. In exchange, you get some freedom. If you decide to leave AT&T over that time, there’s no contract penalty. But you would have to pay the remaining balance.

Phone carriers have been offering big discounts on tablets for a while. This isn’t the first time  in 2014 that AT&T has shaved $200 from the price of iPads that carry cell contracts with conditions. This lets the phone companies pad subscriber numbers as it grows harder to find new smartphone customers. But simply replacing lost phone customers with new subscriptions for tablets doesn’t quite compensate because people with tablet plans pay significantly less than those on phone plans. In either case, it seems to be getting harder to convince people to buy tablets at all. Last quarter, AT&T sold 366,000 tablets with post-paid wireless plans, down from 398,000 a year earlier.

Brustein is a writer for Businessweek.com in New York.

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Companies Mentioned

  • AAPL
    (Apple Inc)
    • $101.66 USD
    • 0.23
    • 0.23%
  • T
    (AT&T Inc)
    • $34.5 USD
    • -0.35
    • -1.01%
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