Damn, one-to-one replacement has always been a plus point for iPhones for me.
They've handed me refurbished phones in nearly worse condition than I brought mine in.
My iPhone 3GS (purchased at release), had a tiny crack by the mute switch. It was in otherwise PERFECT condition. I was told that it may have been a manufacturing defect, so I brought it into the Apple store.
I took it to the Genius bar, showed them the crack, and they said they would replace it. This is what they handed me:
iPhone 3GS, uneven/sunken-in screen.
It would literally scratch my face due to a sharp edge. Not sure if this was a manufacturing defect, or an improperly-replaced screen.
I eventually got fed up and took it back in. This is the next one that gave me:
iPhone 3GS, stiff, "mushy" Home button (no click when pressed), and scratches and scuffs on the chrome bezel. It had obviously been dropped on a sidewalk or something.
I complained, and asked for another one. They told me some crap like "they all probably have something wrong with them".
Having the device replaced completely meant you just ended up with someone else's old crap. Maybe they dropped it, maybe their cat peed on it, or they did something else even more weird with it. There isn't any way of knowing. Apple just slaps a new screen on it and gives it to the next poor sap that takes their phone in for service. I've seen people SWEAR that Apple doesn't give out used/refurbished device, with I know that is absolutely not true. Someone brings in a broken device, they fix it up and give it to someone else.
I try to keep my devices in great condition. I got the iPhone 4S at release, and it's still in MINT condition. If something was wrong with it, I'd want that specific piece replaced, NOT the whole device.
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