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T-Mobile to offer 'free' flagship smartphones at an additional monthly cost

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T-Mobile CEO John Legere stock 1020 3
T-Mobile CEO John Legere stock 1020 3

T-Mobile will start offering high-end smartphones like the iPhone 5 and Samsung Galaxy S4 with no down payment from tomorrow, in what the company calls an "unprecedented" limited-time offer. Under the deal, you'll be able to pick from a number of smartphones, including the iPhone 5, Galaxy S4, HTC One, Galaxy Note II, Lumia 925, and BlackBerry Q10 without making a down payment. T-Mobile isn't giving you a flagship phone for free, though, as you'll need to commit to higher monthly device payments. At the end of your two-year contract, you will have saved some money over the company's regular plans, but in most cases, not a lot.

'Discounts' range from $50 to minus $28

For example, if you were to pick up a Galaxy S4 today from T-Mobile, you'd have to pay $149.99 up-front for the device, followed by a $20-per-month device fee. After 24 months, you'll have paid $629.99 for the device. Under the new "zero down" deal, you get the same smartphone for "free," but then pay $25-per-month for the device, bringing the 24-month total up to $600. You'll see similar discounts across other devices like the HTC One ($649.99 vs. $600), but the iPhone 5 savings ($649.99 vs. $648) are virtually non-existent, and the Galaxy S III price actually raises $27.99.. Some devices, however, like Nokia's Lumia 925, are simply being reduced in price. It's currently priced at $49.99 on T-Mobile's website, and without changing the $20 monthly payments, customers taking advantage of zero down will now get that same phone with a $49.99 discount.

So, while the offer isn't as revolutionary as T-Mobile's Uncarrier initiative, and it's certainly not unprecedented (the company has run similar discount offers in the past), it is definitely cheaper than T-Mobile's regular plans if you opt for a current flagship. The zero down deal starts tomorrow, and is described as a limited-time "summer deal," so while T-Mobile hasn't put an end date on the offer, it's not likely to run for too long.