Why Apple Wants to Sell Prepaid Plan iPhones

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Apple may have been hoping that news out of WWDC would help slow down some of the rampant iPhone 6 rumors, but it has actually been quite the opposite. Another rumor has arisen about Apple's upcoming iPhone release, this time about how they plan to sell them.

In order to prepare for the next round of iPhone sales, Apple is looking to move into prepaid and month-to-month plans. This means you could walk into an Apple store, purchase the phone at full price, and then connect with a prepaid or month-to-month carrier right in the store. Right now, iPhone customers can do this only by unlocking the device, then installing an existing SIM card or activating it at a third-party carrier. 

This move could also be key to promoting the iWatch (which, remember, doesn't technically exist yet.) Allowing for prepaid and month-to-month plans increases the number of iPhone sales, allowing Apple to rival Android and Windows phones, which allow for prepaid plans. If Apple chooses to sell iWatch and iPhone as a package deal, that will increase the number of iWatch sales we can see for the holiday season this year (iWatch is set to come out in October, even though it doesn't exist.) This prepaid deal could also help explain UBS's major prediction of 21 million unit sales for iWatch.
Insider sources have said Apple will partner with AT&T GoPhone prepaid plans and SIM cards, as well as existing T-Mobile SIM cards. We may also see the prepaid plan before any new products launch. Apple is said to plan to begin offering the pre-paid and month-to-month plans in its U.S. stores, beginning in the last week of June.

This article is from the archive of our partner The Wire.