A lot of folks expected Apple to introduce an all-new handset this year. But instead of unveiling a completely new iPhone model, Apple announced that it was going to make its iPhone 3GS free with contract to appeal to the low-end smartphone market.

The $0 handset has reportedly been doing very well for AT&T. One can only imagine the marketing power of the phrase “get a free iPhone today.” But it doesn’t look like the carrier will be able to use such a tagline anymore, as it’s mysteriously raised the 3GS’ price tag to $0.99…

MacRumors points out the change, calling it a “curious move” on AT&T’s part. As aforementioned, the free iPhone was reportedly doing extremely well for the carrier. Here’s what AT&T’s CEO had to say about the promotion during the company’s recent earnings call:

“I also mentioned in my notes that we have another device that I think is going to dramatically change those people that are on smartphones and quick messaging devices, the 3GS, which is free with a 2-year contract. We’ve seen a tremendous, tremendous demand for that device even though it’s a generation old. And actually, we’re getting more new subscribers coming on the 3GS on the average than other devices.”

The $1 price increase shouldn’t hurt 3GS sales at all this holiday season, as it’s still the cheapest iPhone available (by far). And a recent study has shown that Apple’s smartphone is item number two on kids’ wish lists this year, right behind the iPad.

  • Its just $.99. If anyone can’t offered that can help you out : )

  • I’m iPhone 3GS user. Its still great phone compare with the newest smartphones.

  • Anonymous

    In a lot of ways the 3GS is better than the 4S. It can be jail broke. I wish I still had my old boot 3GS I would have an untethered jailbreak right now. I’m so board with a stock iPhone. I’m sick of checking twitter every free second for the jailbreak.

  • shannonw6290

    Is this really worth writing an article about?

    • Matthew Hill

      think about it … there isn’t that much new and significant happaning everyday.. even they didn’t post these stories, there would be no content. Nothing for trolls to complain about 🙂

  • Not a bad deal. I mean, the 3GS is still a very good handset. There’s no denying that.

  • Rubbish. Here in UK my girlfriend got 4S for free on 24 months contract at 35£/month.

    • On 3 ..it’s a good deal..so that’s now 2 people that I know about using the 3 network for a iPhone. Or any other phone for that matter..

    • Likewise for Spain with Movistar, Orange and Vodafone. If you sign a 24 month contract and you choose the right plan IPhone 4S is free.

  • I think this is a load of crap, yeah it’s just a dollar but still it’s a dollar that customers shouldn’t be paying. Think about it if AT&T gets 10,000 new iPhone 3GS customers they just made 10,000 dollars. AT&T is one of the biggest rip offs they are out there.

    • Painman

      Get out of here, if you can’t afford a dollar upfront you aren’t going to make the credit score for the 24 month contract.

      AT&T are entitled to make a profit, if they fail you lose a network.

  • Anonymous

    Fucking lame, just a dollar, they also want to earn.

  • Anonymous

    Hey, guys, MACrumors reported the reasoning behind the nominal charge of 99 centavos:

    A way to halt zero-cost purchases without a credit or debit card from identity thieves, as the 99 cents cannot be charged to a cell bill but has to be charged to a bank-issued card that matches identity and delivery address.

    Stop the moaning.