Not all cell phones are created equal. You can buy an iPhone 4S today and sell it a few months later on the secondary market for almost what you paid for it. However, if you buy the latest big fancy Android phone, a few months later it has lost hundreds of dollars in value.

I wonder if this has much of anything to do with popularity/design, because you have to think the slow rate at which Apple releases iPhones, compared to the rate at which new Android phones comes out, plays a huge role in this.

Priceonomics also noted this underlying assumption that they make:

At Priceonomics, we firmly believe that resale value is the best objective indicator of product quality.

I couldn’t disagree with that statement more. There are far more factors controlling the resale value of cellphones. Things like:

  • Gazelle, or any other company wanting to buy back the phone. Why would you sell your iPhone for less than what Gazelle is offering — this pumps up the price.
  • Apple refurbished units set the price for mint condition used phones.
  • Carrier subsidies: because maybe I am willing to pay $25 more than what I could buy the phone new for, just so I didn’t have to be locked into a contract.

All this plays a large role in determining price — much larger, I think, than product quality.

[via Macworld]

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