Giving your old iPhone a new life

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When you pre-order your iPhone 4S Friday, that means you’ve got a week to anticipate life with your new phone before its October 14 release date. But if you’re an existing iPhone user, it means you’ve also got to make plans on what to do with your soon-to-be redundant smartphone.

The good news: You’ve got plenty of options, starting with the most obvious choice—turn that old iPhone into a slightly used, slightly thicker iPod touch. Your calling capabilities and 3G/EDGE connectivity may have moved on to the iPhone 4S, but that old phone of yours can still connect to Wi-Fi and still run iOS apps. (And if you upgrade to iOS 5 next week, you’ll add even more capabilities to your supposedly defunct phone.) Should anything go wrong with your new phone, it never hurts to have a backup in easy reach.

But if you’re ready to let go of that iPhone 4 or iPhone 3GS, here are a few more options worth considering.

Return it to Apple or your wireless carrier

Apple features a Reuse and Recycling Program; earlier this week, the program was offering to pay up to $200 for a gently used, top-of-the-line iPhone 4. (That payoff—which comes in the form of an Apple gift card, and not cold, hard cash—drops off for phones with scuffs, scratches, and water damage.)

Verizon also has a trade-in program that lets you get an online appraisal on your current phone; the company will pay you that value in the form of a Verizon gift card. AT&T, meanwhile, has its own Reuse & Recycle program—that company asks you to bring your old phone to one of its stores.

Even Sprint—which has never sold an iPhone until now—is offering $210 for a 16 GB iPhone 4 that was originally sold by the other two wireless companies.

eBay was offering big money for used iPhones.

Sell it to a third-party reseller

Want to know what makes an iPhone launch such a circus? It’s not just the buyers. While crowds lined up outside Manhattan’s iconic Apple Store last year to buy the then-new iPhone 4, they emerged to be greeted by dozens upon dozens of representatives from electronics resale companies, offering cash for the user’s newly discarded iPhone 3GS.

You don’t have to hurdle the hustle-and-bustle outside a store to get rid of your iPhone, though: There are plenty of companies willing to do the job online. Many resellers—among them NextWorth, Gazelle, YouRenew, and—will gladly pay to take your iPhone off your hands. Earlier this week, offers ranged between $160 and $314 for a 32GB iPhone 4 in good condition; don’t expect those offers to last as older iPhones start flooding the resale market.

If you’re wondering what it’s like to sell your aging electronics to a reseller, Macworld contributor David Chartier’s walk-through of selling his original iPad is worth a read. It’s also a good idea to do an online check-up on the companies offering to buy your iPhone to see which ones have good reputations and which have a string of unsatisfied customers. Start by checking with the Better Business Bureau website. eBay, NextWorth, and YouRenew are all accredited with the organization; Gazelle is not, though the bureau hasn’t recorded any complaints against that company. isn’t accredited either; its parent company, Laptop & Desktop Repair, has been the subject of 142 complaints with the bureau during the last three years.

“They’re good for the environment and good for the budget,” Katherine Hutt, a spokeswoman for the Better Business Bureau, said of companies that buy and refurbish iPhones. “But know who you’re dealing with.” 

Given the amount of legwork that goes into checking up on resellers, you may find it easier to sell your unwanted iPhone yourself, either through Craigslist or eBay. It could be more financially rewarding, too, as you can set your own price.

No matter how you sell your old iPhone—whether via a reseller or all by yourself—you’ll want to make sure that the phone is stripped of any personal data before it leaves your hands. Apple has some pretty clear instructions on how to erase your phone’s memory and settings. Just go to the Settings -> General -> Reset, and touch the Erase All Content and Settings button. You’ll also want to guarantee you’ve backed up all the data on the device first, so that you can restore it to your new phone. iTunes should do that when you sync it before buying your new phone, but to be extra sure, select the iPhone in iTunes’ Source list, right-click on it, and choose Back Up.

Passing it along

Giving your old iPhone to a friend or relative may have somewhat less allure now that Apple and the phone companies will be giving away the iPhone 3GS for free (provided, of course, that you sign a new two-year service contract). But an iPhone 4 will still make a nice hand-me-down, especially for people who don’t want to pay $99 to buy a new iPhone 4. Before handing off the phone, though, make sure that your lucky recipient really wants to take on a two-year commitment with a wireless carrier. And perform the phone back-up and erasing steps outlined above.

If you do opt for the giveaway route, note that AT&T and Verizon will let you transfer your existing contract—phone and all—to a third party.

Jailbreak it

With the many improvements that will come with iOS 5, iPhone users now have fewer reasons to jailbreak their phones. Some still remain, though: Having full access to the iPhone’s complete file system is attractive to the technically inclined so that they can easily transfer files between their computers and iPhone. With a jailbroken and unlocked iPhone you can use your phone overseas without incurring roaming charges. And clever hacks exist so that with the correct cable you can project the iPhone’s entire interface to a TV or projector.

The danger is that not only are you breaking your license agreement, but you’re now engaged in the cat-and-mouse game. You jailbreak, Apple releases an update that disables that jailbreak, and you either don’t update your phone for the latest features (or, more importantly, security fixes) or update and wait for the jailbreakers to come up with a new way.

Macworld’s Christopher Breen contributed to this report.

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