The cottage industry for used Apple iPhones is no secret, thanks to eBay and a sizable gray market, especially overseas. A new company, Freeiphoneswap.com, hopes to simplify the process for sellers by eliminating the need to deal with strangers and by offering enough money to cover the purchase of a new iPhone 3G.
Sam Hickson, who runs the as-yet unincorporated company, said there are two sales methods. Consumers can mail old iPhones to a location in New Jersey and then receive a check or a PayPal transfer, or they can visit what Hickson calls “street teams” staffed by models and temps who buy old iPhones on-site. He said teams will open today in Atlanta, Long Beach, Miami and New York.
The current payments are $100, $200 and $300 depending on the exact model of iPhone. Only a small portion of the phones are resold; most are partially recycled and partially sold for components, with 10% of trade-in proceeds going to youth educational programs, Hickson said.
He stressed that it’s not just a short-term venture to capitalize on the iPhone 3G rush. The company will expand into buying BlackBerrys and other smartphones from companies such as HTC and Palm, he said, while a new Website will debut next week with more information about the company to ease the concerns of any customers nervous about sending in their old iPhones.
“We do have very strong backing. We have no concerns from Apple at all,” Hickson said. “Word will spread very quickly that we’re reliable and we’re not disappearing anywhere.”
He may be right – a company called Thaddeus Computing via UsedHandhelds.com has been around for several years selling Hewlett-Packard palmtops from the early 1990s. Similar cult-like markets exist for old Psion handhelds and another Apple product, the Newton.