Mobile rental ? This kind of facility is available for international travellers. Atleast in Malaysia, but that includes SIM card & other service features.

How will you explain risk management in this business ? Since unit would be plenty in number but the value of each unit is relatively low. And you need to invest slightly heavy against the potential returns. You need to have several units in each model of every brand. And you can't charge huge rental since the cost of each mobile phone is nose diving to newer lows.

I am not looking at "Mobile Rental" per se. I am looking at "Mobile Rental" as a step to "Mobile retailing".

People want to change Mobiles as often as possible(starting from a time period of 2 weeks)

With the increasing sophistication of Mobiles, deciding on the right choice becomes difficult.

Gives an opportunity for the buyer to try out "unbranded" but high quality mobiles.

Every business has it's risk. We require Address/Credit card verification to roll it out.

Given the speed at which mobile phone values depreceate, the inventory time and cost could be leveraged to offset costs.

I'm not sure the financial model will work in NA. Maybe in India.
Let's have an example. A high end smartphone RIM, Nokia or Palm with all the toys (camera, messaging, mp3 etc) will set you back, say $600 outright. Because this price is so high, the cell service carrier will provide a contribution for this phone (known as subsidy) and the phone may sell for $300 (that is what the customer must pay). The downside of this very common arrangement is that the customer must commit to an X$/month plan, usually where X$ is a significant amount, like 60$ for a voice and data plan. Id you leave the plan early, you will need to pay the subsidy back, in this case 200-300$. So by the time the phone become unencumbered, it is already obsolete ( less desirable) and superseded by newer models with more features - the phone may be worth less than 75$ (these are actual numbers I've researched). So what will you be able to charge to lease a 75$ phone? 5$/month? Not worth the effort. Next you will have to deal with dying batteries, faults, repairs, vendor SIM locking (which is a huge problem for newer models), carrier specific firmware versions, blacklisted phones (marked as stolen), too many variations of CDMA, different frquency bands (at least 6 combined CDMA/GSM) etc. If you don't don't all these aspects, then you have not done your homework for this business.

Situation

I want to buy a phone. There are 6 from different brands available. I have shortlisted 2 and i am indecisive. I have to choose one of them. After using it for a week, i realize, it's not as friendly as i thought.

Solution

Take one of the phones on a rental(charged based on duration needed).
Try it. I didn't like it. Give it back. The phone could be seconds or could be rented to another user interested in that phone. The user can go in for trying the other phone.

Situation

I want to have the latest gadget at any point of time.

Solution

Enter into an agreement with MobiLease so that it will provide you new phones over a period of time based on the contract signed.

We are trying to address life styleneeds and not one where people don't have the ability to buy an expensive mobile phone. This kind of a model can be pulled off everywhere.

We are trying to encourage a customer into buying a phone he likes with a concept "try it before you buy it".

the thing is that if you get a phone, then do you not want to transfer all your contacts etc to it? How can you do a proper test of the phone without making it completely your phone during the test period? that also means transferring your number to it (mobile number portability) which not all carriers or countries permit. you mentioned price - it IS a big issue - most new phones are in the 100-300$ range new, so you will need to have not only an inventory of these phones in current models, but also for the appropriate customer carrier ( in the US there are some 50+ carriers but only 3-4 main ones), frequency band (800, 900, 1800, 1900 Mhz) and type (CDMA, GSM, PPT etc). Too complex and too much overhead. Clearly, you need to understand all the issues involved.

I like TheGuru's point about transferring contact... I mean its doable and any biz will have to offer that service. But I would like to rent a cellphone rather than buy... it really is hard to know if a phone sucks or not without using it for a month.

Why not rent to own? as you've said New models keep on coming and user keep on changingtheir units as a fact...the inventory would be too large and spell loses to me, by its depreciation cost in matter of months!
Solution: Better go to 2nd hand mobile unit market or rent to own of which client can simply give it some member of the family household or relatives esp the kids.