Verizon, T-Mobile and AT&T aren’t getting aggressive with the new iPhone

A report by SpeedSmart found significant LTE speed improvements in Apple's new iPhone XS and XS Max. (SpeedSmart)

The fall launch of the iPhone and other high-end smartphones often represents an opportunity for the nation’s wireless network operators to steal customers from each other with aggressive pricing promotions on the devices.

But this year that’s not the case.

“Our new analysis of iPhone XS/XS Max promotions, and comparison to prior generation offers (iPhone 7/8/X) indicates ‘more of the same,’ lacking a meaningful ramp in aggressiveness of deals,” wrote the analysts at Wall Street firm Deutsche Bank Research in a recent note to investors. “This year's carrier deals for the iPhone XS/XS Max ($1,000/$1,100 ASP respectively, available 9/21/18) are largely centered around BOGO (buy one, get one) promotions offering $700 off the second phone (when a new voice line is added). While this is admittedly more aggressive relative to the seasonal lull seen in 2Q, this is fairly in-line with 1Q ‘BOGO-centric’ deals we saw earlier this year. In addition, we don't believe this year's offers indicate a ‘ratcheting up’ of competitive intensity (particularly relative to prior years), as some bears had feared.”

Indeed, the offers from AT&T, Verizon and T-Mobile for Apple’s new iPhone XS and XS Max are virtually identical. Customers must buy their first device at full price and then they can obtain roughly $700 off their second device—but they must also add a new line of service. Thus, the offers don’t represent true buy-one-get-ones, because existing customers can’t just upgrade to a new device and get a second one for free.

"Offers for the iPhone XS and XS Max are somewhat more attractive than they were last year assuming a new line is added, but then again, they need to be, as the new iPhones cost more than the iPhone 8 did," added Jeff Moore of Wave7 Research, which closely tracks promotions by wireless service providers. "One major trend we’re seeing from the carriers this year is that all carriers other than AT&T have split their offers into two tiers – one for new lines and a trade-in offer for existing customers. An interesting shift for this fall is that AT&T is no longer requiring TV to take advantage of its BOGO offer, while a new line of service is still required."

As the Deutsche Bank analysts noted, Sprint is the outlier. For two weeks, the company is offering the iPhone XS for $0 per month (after $41.67 per month credit) with an eligible trade-in and Sprint Flex Lease. The iPhone XS Max on Sprint will be $4.17 per month (after $41.67 per month credit) with an eligible trade-in and Sprint Flex Lease. (Sprint also launched its new “Sprint Complete” device protection program in conjunction with the promotion.)

The Deutsche Bank analysts said Sprint’s offer does not come as a surprise. “Sprint has more recently sought to position itself as the value leader in US Wireless, so this is not a significant surprise,” they wrote. “We also note recent company commentary … indicates weaker postpaid phone volumes in C3Q18 for Sprint; so, the more aggressive promos for the new iPhone may be aimed at improving volumes later in the quarter.”

Interestingly, T-Mobile appears to have discontinued the iPhone upgrade program it launched last year, as noted by TMoNews. The program launched in September 2017 and ended last month, and allowed customers to purchase an iPhone and then upgrade to a new iPhone after they paid off 50% of the cost of the phone.

And in terms of iPhone promotions, what are the nation’s newest entrants into the mobile industry, Comcast’s Xfinity Mobile and Charter Communications’ Spectrum Mobile, doing? Comcast’s Xfinity Mobile is offering $300 back to customers who purchase a new iPhone, activate a new line, and port their number to Xfinity Mobile.

But Spectrum Mobile does not appear to be offering Apple’s newest devices. The company did add some Apple iPhones to its lineup prior to the launch of Apple’s newest gadgets, but a representative did not respond to questions from FierceWireless about Apple’s iPhone XS and XS Max.

Reviews of the iPhone XS and XS Max generally give the devices solid marks for performance, albeit at prices higher than most other smartphones. Importantly, speed testing vendor SpeedSmart posted its initial tests of LTE speeds on the iPhone XS and XS Max across the three major U.S. carriers, as noted by 9to5 Mac. The firm found significant speed increases. For example, the firm found AT&T’s iPhone XS Max notched download speeds of around 72 Mbps, up dramatically from the 28 Mbps download speeds recorded by the iPhone X. That’s likely due to Apple’s decision to include “gigabit class LTE” in its new iPhones, including LAA technology and 4x4 MIMO.

To be clear, though, Apple’s new iPhones aren’t the only devices hitting the market for the critical fall holiday shopping season. Samsung is scheduled to make a device announcement in October, and Google is widely expected to announce the new Pixel 3 in the coming weeks as well.