At Apple’s "Let's Talk iPhone" press conference Tuesday the company revealed that it will be releasing a free "iPhone 3GS" to customers.
Phil Schiller, senior vice president of worldwide product marketing at Apple, told the press at the event that customers who get a two-year contract from carriers that sell the phone will get the "iPhone 3GS" for free.
This landmark announcement is significant as it shows how Apple is now reaching out to a wider customer-base, offering an "iPhone" for free for the very first time in its history.
Apple also announced that it is set to begin selling its "iPhone 4" model for just $99 with a two-year contract.
The new 16 GB "iPhone 4S” will go for $200 with a two-year contract, while the 32 GB version will sell for $300.
Verizon is one of the only cellphone carriers who won't be carrying the "iPhone 3GS."
iPhones have held on to the top two slots for mobile phone sales, according to sales data. Google’s Android operating system was on 52 percent of all units sold compared to 29 percent for Apple’s iOS.
RIM’s BlackBerry was number three with 11 percent. According to a report from The NPD Group, Motorola’s market share fell from 12 percent in Q2 2010 to 9 percent in the current quarter.
The report also noted the growth of prepaid plans offering smartphones. In Q2 2010, 8 percent of prepaid phones were smartphones, compared to 22 percent in this year’s second quarter.
This past January, AT&T cut the price of the "iPhone 3GS" model to $49 with a two-year contract.
Refurbished models of the smartphone can go for as low as $9. Best Buy offered the phone for free with a contract this past August.
Apple CEO Tim Cook wrapped up his company's press conference with this statement: “When you look at each of these things, they’re industry-leading in and of themselves, but what puts them out front is how they’re engineered to work together so well. Only Apple can make such powerful hardware and services like this and bring them together. I am so proud of Apple and all the people that worked so hard to make these things a reality.”
The event marked the first premiere product introduction for the new CEO.