Refurbished cell phones get a little smarter

Suzanne Choney • E-mail

When AT&T recently offered refurbished 8-gigabyte iPhone 3Gs for $99, news of the deal eclipsed another major iPhone announcement, that Wal-Mart is now stocking the hottest smartphone in America.

If you can get a refurbished iPhone for $99, are good deals in the offing for other popular smartphones, like the BlackBerry Storm and the Google G1?

They may be if enough consumers, faced with buyer’s remorse, a change of heart, frustration or problems with such devices, decide to return their multi-functional gizmos within 30 days, making those phones eligible to be refurbished and re-sold by wireless carriers.

“As more and more phones become smartphones, more capable and more feature-rich, we’re likely to see the number of refurbished phones going up because of returns,” said Kevin Burden, ABI Research’s mobile devices research director. “Some phones may not meet the expectations of buyers, who see them as too complex.”

Smartphones, so-named because of their ability to handle e-mail, Web browsing and some computer-like functions, are one of the hottest segments in the cell phone market, propelled in part by devices such as the iPhone and Research In Motion’s line of BlackBerrys.

But the complicated bits of communications gadgetry are not for everyone, said Burden. “We’ve talked to plenty in the industry who say, ‘We sell (some) people a snappy smartphone, and they come back a couple weeks later and say they don’t get it, it’s too confusing. They want a phone where they can make a phone call, do text messaging and maybe have something to hold their calendars.’ ”

Touchscreen phones, in general, are still new to many users, who may think they want such phones, but find themselves longing for physical buttons to press, be it a phone keypad or QWERTY keyboard, once they get the phones home.

“What I have seen with touchscreens is that they tend to polarize people,” Burden said. “Some people absolutely love them; others absolutely hate them. But if a phone is returned, it doesn’t necessarily mean it’s not working right or working the way it’s supposed to; it’s just not meeting the expectations of those particular users.”

Appeal in a down economy
The $99 iPhone, available only online, was a “promotion” for the last two weeks of December, along with $199 pricing for the 16GB iPhone, according to AT&T spokesman Mark Siegel. Both phones were priced at $100 less than the retail cost with a two-year data and voice contract.

As of Jan. 1, refurbished iPhone prices were back up, with 8GB iPhones shown on AT&T’s site for $149, and the 16GB model at $249.

Given the current economy, refurbished phones — especially high-demand models such as the iPhone — may have more appeal to cash-strapped buyers.

“I think what you sometimes see in tough times is a flight to quality,” said Siegel. “And the iPhone’s a great example of that. If we can put refurbished iPhones into the hands of folks for just $99 and they get the benefits of this great device, all the better.”

Siegel declined to say whether AT&T will offer another round of discounted refurbished iPhones, which come with a warranty of “90 days or more,” according to the company. New phones usually come with a one-year warranty.

AT&T, which sells other refurbished phones, including models of the BlackBerry Curve and Pearl, as well as Palm Centro, notes on its site that “refurbished phones are previously owned devices that have been unused or lightly used and returned during the 30-day trial period.”

Each phone, the company says, is “independently quality tested and loaded with the latest software to meet current factory standards.”

Part of the iPhone’s appeal is its sleek design, encased in black or white plastic, with a large 3.5-inch touchscreen. AT&T notes that “some refurbished iPhone 3G devices will have minor scratches,” which could be a deal-killer for those who want to start their relationship with the phone scratch-free.

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