Countering Apple's upcoming trade-in program, Best Buy offers 50% off iPhone 5 for Labor Day

From Friday, Aug. 30 through Monday, Sept. 2, Best Buy customers bringing in a working iPhone 4 or 4S can get a 16-gigabyte or 32-gigabyte iPhone 5 for at least half off of its regular price. The deal is contingent upon the activation of a two-year contract.

Customers opting for the 16-gigabyte iPhone 5 will receive at least a $100 trade-in credit toward the purchase, knocking the on-contract cost down to $100 for an AT&T, Sprint, or Verizon model. Those opting for the 32-gigabyte model will receive at least a $150 credit, knocking the on-contract cost to $150.

While the promotion does set a minimum discount, it is possible for customers to get more for their trade-ins, depending on the condition of their phones. If a customer's iPhone 4 or iPhone 4S is worth more than the guaranteed credit, that customer will receive the additional amount in the form of a Best Buy gift card.

In order to take advantage of the offer, customers must be eligible for an upgrade with their carrier and agree to a new two-year contract. Phones traded in must be able to power on, and they must be free from water damage and screen cracks. The offer is not applicable for iPhone 5 64-gigabyte models, T-Mobile, or no-contract iPhones.

Best Buy's announcement comes as Apple is said to be preparing its own trade-in program based out of its hundreds of retail stores across the U.S. That program will see Apple retail employees inspecting phones and having customers fill out questionnaires before the phone is assigned a value. Customers will then be given a gift card worth the estimated value of the phone, and that card must be used toward the purchase of a new iPhone if the customer is eligible for an upgrade from a selected carrier.

Apple has yet to confirm that such a program is in the offing, but multiple reports have the iPhone maker already training employees in the particulars of the trade-in service, possibly for a rollout in some stores as soon as this weekend. Apple CEO Tim Cook has not publicly dismissed the possibility of such an offer, and he said it could happen due to the way iPhones retain their value.

"The reason that [a trade-in program] is so attractive around an iPhone," Cook said in July, "is that the residual value of an iPhone stays so high. That makes the trade-in programs a win-win from many points of view. But we haven't announced anything."

Best Buy's Labor Day offer is different from other trade-in services such as Gazelle, which pays customers for their devices in cash, or Amazon, which offers a gift card in exchange. In addition, some such as Gazelle are offering customers the ability to lock-in a price on their trade-in, and ship it by Oct. 15 — after Apple's new iPhones are expected to be announced. A complete list of online offers can be found in the AppleInsider Trade-In Guide.