What's Hot: Used Apple iPhones

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NextWorth relies on an algorithm developed by MBA students and Polutnik at Babson College. The algorithm uses data such as an iPhone's storage capacity and extent of wear, as well as traffic to NextWorth's site and partner stores, to spit out the going price for your model right on the site's online calculator.

Some startups are relying on more than money to bring in sellers. Trade2save, due to launch in September, will not only pay for your old iPhone but also give you "carbon points" that can be used to buy other used products from the site, such as other phones. "When a customer trades in their iPhone, someone else will buy it instead of buying new," Trade2save CEO Chris Whittome writes in an e-mail. "Hence they will be saving money, and saving on the environment because they reduce the demand on manufacturing another unit."

The appeal of a used phone may be especially high outside the U.S. American consumers favor new gadgets, but overseas buyers are less averse to used phones. Flipswap, for instance, sends all of its iPhones to dealers in South America. "For a used phone, there's not as much stigma in South America as in the U.S.," says Flipswap CEO Sohrob Farudi. "They don't worry about its being used."

If enough consumers opt for used rather than new devices, Apple CEO "Steve Jobs [may have] a big problem," Whittome of Trade2save adds. Well, yes and no. Apple refreshes its product lineup on a regular basis, giving consumers a growing list of alternatives to dated devices that in any case won't remain gently used forever.

Farudi and his peers are enjoying the boom, however long it lasts. "When the iPhone 3G came out, we've continued to grow," he says. "It's been very good for our business."

Business Exchange related topics:
Apple
iPhone
Mobile Industry
eCommerce

Kharif is a senior writer for BusinessWeek.com in Portland, Ore.