The opening sentence of the article isn't accurate - in China, most free phone on contract deals (including this one) aren't in the form of "we give you a free phone if you agree to pay X RMB per month for Y months" as you would expect in the UK/US, but actually "you pay us for the phone up-front then we deduct the price from your monthly fee over a period of Y months". (China has much less developed credit reporting systems than Western countries, so it's safer for them this way - even if you decide to skip out on the contract before your term is up, they haven't lost money).
PS this isn't a new move from Unicom - they offered a very similar deal (possibly identical?) for the iPhone 4, and before it the 3GS. I was going to get one, but they said I couldn't transfer my old phone number to the new plan.