iphone_3g_sThe new Apple iPhone 3G S is certainly the gadget of the moment. With a new operating system, faster processor, and video capabilities, like a lot of folks, I wanted to upgrade. One problem, however, was frequent concern about the upgrade price. Many tech blogs were reporting it would cost as much as $500 to upgrade to the 3GS. I just got one for under $15. Here is how I did it:

I was able to get this deal because I own a 2G iPhone with an expired contract. Owners of 3Gs still under contract might still be able to use this approach to save money.

Use Bing to get 35% cashback on your new iPhone 3GS purchase

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To get 35% cashback on purchases at AT&T, go to Microsoft’s Bing search engine, search for “ATT Wireless” and click on the orange “Bing cashback” link (shown as the second result above).

To get the cashback, you will be sent through Bing’s cashback program to the AT&T Wireless site. Buy your iPhone 3G from AT&Ts website and you will receive a cashback confirmation email from Microsoft a few hours later (shown below). To receive your cashback, you will need to register with Bing cashback and wait a few weeks for the rebate to process.

This discount brought my subsidized $199 iPhone 3GS down to $129. (Thanks to TechCruch for the tip).
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The additional amount on my receipt was for a gel skin I bought for the phone, also using the cashback discount.

Use Gazelle to sell your old Apple iPhone

Having paid $129 for the new iPhone 3GS, I then sold my used two-and-half-year-old 2G iPhone on Gazelle for $116, for a total upgrade cost of under $15!

Gazelle will purchase all kinds of used gadgets, from video games, to laptops, to smartphones. Most of their prices are nothing special. For instance, my newly replaced laptop received a Gazelle offer of under $20. But their offers for used iPhones are very reasonable. Simply go to Gazelle, search for your gadget, fill in details on its condition, and receive instructions on how to send it in and receive payment. Gazelle promises to wipe the data on your phone for you (you can choose whether to trust that promise).
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My guess is that you could probably get a similar, or better, price selling your used iPhone on ebay, but it would be a little more work logistically.

(photo: renatomitra)