On its Microsoft Store website, Microsoft outlined the new deal: It will accept "gently used" iPhone 4S and iPhone 5 smartphones -- the 2011 and 2012 editions, respectively -- and pay a minimum of $200 for each. The Redmond, Wash. technology company will issue the funds as a gift card good for purchases at the Microsoft Store.
As in the iPad buyback program that debuted two weeks ago, customers must bring their used iPhones to a retail outlet in the U.S., Canada or Puerto Rico -- trade-ins are not supported online -- where a sales representative will evaluate the device and decide on the dollar amount. Microsoft has 77 stores in the U.S., Canada and Puerto Rico.
"Microsoft Store gift-card value ... is subject to Microsoft's discretion and manager approval," the website said. "All trade-ins are final. Cannot be redeemed for cash. Limit 1 per customer."
The gift cards that result from an iPhone trade-in can be used for anything Microsoft sells in its stores, including its Surface tablets and third-party PCs, but the deal is clearly intended to tempt Apple's current customers into switching to a Windows Phone like the Nokia Lumia 1020.
That may be a very tough pitch.
According to market research company ChangeWave, 70% of iPhone owners polled said they were "very satisfied" with their purchase, the top-ranked percentage in the survey, which also noted that the second-most satisfied customers were ones who had a Samsung smartphone: 54% of those people said they were "very satisfied" with their device.
Like the earlier iPad deal, Microsoft's iPhone buyback program isn't available online so it's impossible to tell what the company's salespeople will pay for an iPhone before getting in the car. Re-commerce vendors such as Gazelle and NextWorth, which do operate online, pay between $190 and $210 for a working 16GB iPhone 4S on AT&T's network, and between $290 and $304 for a 16GB AT&T iPhone 5. The lower prices for both devices were quoted by Gazelle, the higher prices by NextWorth.
Microsoft also has a broader buyback program in place that operates online, and that accepts a wide variety of rivals' devices, including the iPhone. That program produced trade-in quotes for the same 16GB AT&T iPhone 4S and iPhone 5 of $160 and $250, respectively, or between 16% and 24% less for the iPhone 4S, between 14% and 18% less for the iPhone 5, than Gazelle and NextWorth.
Not surprisingly, the new buyback program does not accept Microsoft's own Surface tablets as trade-ins; none of Microsoft's current deals do. That's triggered complaints by owners of the company's first-generation tablets, who last week urged Microsoft to offer cash for their Surface RT and Surface Pro devices so that they could trade up to the second-generation Surface 2 and Surface Pro 2 when they go on sale Oct. 22.
Microsoft's iPhone buyback program expires Nov. 3. Apple has already launched new smartphones -- the flagship iPhone 5S and the lower-priced iPhone 5C -- but the former is in very short supply, with current orders slated to ship at an unspecified date next month.
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