The iPhone may be popular among consumers, but it has fallen short of expectations for at least one prepaid carrier.
Leap Wireless, the company that operates Cricket Wireless, told the Wall Street Journal that it is currently on track to sell just half the number of iPhones it committed to selling in its first year contract with Apple. If that doesn't change, the Journal says Leap could wind up with $100 million worth of unsold iPhones.
Cricket Wireless started offering the iPhone last June, making it the first prepaid carrier in the U.S. to do so. Unlike the other major U.S. carriers, Cricket sold the iPhone at a higher upfront fee -- starting at $399 for an 8 GB iPhone 4 -- but then let customers sign up for a much cheaper prepaid data and calling plan that cost $55 a month. Other prepaid carriers followed suit, including Virgin Mobile USA, which undercut Cricket by offering prepaid plans as cheap as $30 a month.
At the time, the thinking was that making the iPhone available on these prepaid carriers would help Apple to appeal to a new demographic of customers who either can't afford more expensive carrier plans, or simply feel uncomfortable committing to a contract. Leap's lackluster sales raise questions about whether prepaid iPhones have in fact caught on with consumers.
Leap, for its part, is planning to ramp up its marketing efforts as well as providing additional financing options for consumers and perhaps even lowering the upfront price of the iPhone.