Radio Shack slashes iPhone prices by $50, offering iPhone 4 for $25 with 3GS trade-in

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In an unprecedented sale designed to boost awareness of its wireless business and create an edge up on the competition, Radio Shack is knocking $50 off all iPhone handsets and offering trade-in incentives that could net customers a brand new iPhone 4 for as little as $25.

The one week sale, which began Saturday morning and runs through December 11th, lops $50 off all current iPhone models, meaning customers new to AT&T or eligible for upgrade pricing can take home an iPhone 3GS for $50, a 16GB iPhone 4 for $150, or a 32GB iPhone 4 for $250.

What's more, the specialty electronics retailer is also upping the value proposition of its Trade & Save program, offering customers a $75 credit towards the purchase of a new phone when they trade in a working iPhone 3G or a $125 credit when they trade in a working iPhone 3GS.

Those credits can be combined with the retailer's instant $50 savings, meaning customers who trade in an iPhone 3GS can save $175 off the cost of a new Apple handset, bringing the cost of a the $299 32GB iPhone 4 down to $125 and cutting the price of the $199 16GB iPhone 4 to just $25, before taxes and standard activation fees.

The deals are exclusive to Radio Shack's brick-and-mortar retail stores and are not available online. Existing AT&T customers looking to take advantage of the offers are encouraged to use the retailer's Eligibility Checker to pre-determine whether they qualify for upgrade pricing.

It should be noted that as part of the promotion, Radio Shack is taking a more lenient approach on iPhone trade-ins. Instead of assessing the value of the used handsets based on their physical condition, the company is expected to extend $75 credits on iPhone 3Gs and $125 credits on iPhone 3GSs as long as they are fully functional and don't have a cracked screen.

A Radio Shack at 78 Brookside Ave in Chester, NY, one of the retailer's more than 4,600 storefronts worldwide.

Credits extended to customers through the Trade & Save program are provided in the form of Radio Shack gift cards. Therefore, a customer trading in an iPhone 3G ($75 credit) for a new iPhone 3GS ($50 during the sale) should be able to walk away with a new iPhone 3GS and $25 gift card at no cost.

Readers can use Radio Shack's store locator to find their nearest location.