Emerging Market for Refurbished Smartphones Offers Mobile Businesses An Opportunity to Upgrade AND Save Cash

July 21st, 2009 by Greg Goldfarb | located in Tips and Tricks | trackback

Companies I’ve worked with have been buying refurbished laptops for years, and not because they can’t afford to buy a new one. With technology changing so fast, you can get a great laptop with nearly the same state-of-the-art capabilities as a brand new laptop, but for a lot less money. To me it just makes good business sense to buy one that’s slightly used.

I see the same phenomenon happening with mobile phones, and the trend is likely to accelerate as 3G connectivity becomes standard. Prices for smartphones such as Apple’s iPhone and Blackberry’s Bold and Curve models are now a third less than they once were. When Apple introduced its iPhone 3GS last month, it slashed the price for its iPhone 3G to $99—brand new. (I remember people paying upwards of $400 for this phone when it first came out two years ago).  Just like with refurbished laptops, the vast majority of Apple’s new 3.0 features run well on both the original 3G and the new 3GS.

Interestingly, AT&T is the only major wireless carrier openly promoting refurbished devices.  It’s odd considering that carriers’ main business focus is increasing service revenues rather than device revenues.  Beyond a $79 refurbished iPhone and Blackberry, AT&T is currently promoting six or so highly capable, refurbished 3G phones and smartphones for under $50!

For many small and mid-sized businesses, this trend toward selling refurbished smartphones clearly lowers the barriers to entry of many new mobile data and Web capabilities.  If your organization is mobile, this is a high ROI time to upgrade.  For the price of one iPhone two years ago, you can now outfit an entire team with eight Samsung Black Jacks, for instance.

There are also some interesting channels emerging in this space.  On the sell side: Traditional, pre-owned devices channel like Cellular Country. On the buy side: A new, eco-friendly phones-for-cash organization called Flipswap. With hundreds of millions of devices turning over each year and a slowing curve of hardware innovation, it only stands to reason that this market is poised for significant growth.

Even older generation smart phones bring mobile workforces invaluable capabilities and technology considered bleeding-edge less than 12 months ago. With such a viable secondary market emerging for smart phones that connect mobile business users to email and the Web, it makes sense for companies to make these refurbished phones standard issue for new employees. In terms of productivity, the cost for NOT outfitting mobile workforces with smart phones could be much, much higher.

Which devices do you consider critical for business use? Have you found other interesting sources of pre-owned smartphones?  We would love to hear what you think.

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