The company has discussed allowing users of the program to swap out their devices for new models when fresh hardware comes out. It historically releases new versions of its major devices, including the iPhone, iPad and Apple Watch, once a year.
Apple has been working on the subscription program for several months, but the project was recently put on the back burner in an effort to launch a “buy now, pay later” service more quickly. Nonetheless, the subscription service is still expected to launch at the end of 2022, but could be delayed into 2023 or end up getting cancelled, the people said.
would be a major strategy shift for a company that has generally sold devices at full cost outright, sometimes through instalments or with carrier subsidies.Credit:Bloomberg
Bloomberg reported last year that the company has been working on a “buy now, pay later” service for all Apple Pay transactions.
The company has had preliminary discussions internally about attaching the hardware subscription program to its Apple One bundles and AppleCare technical support plans. Apple launched the bundles in 2020 to let users subscribe to several services -- including TV+, Arcade, Music, Fitness+ and iCloud storage -- for a lower monthly fee.
The subscriptions would likely be managed through a user’s Apple account on their devices, through the App Store and on the company’s website. It would likely also be an option at checkout on Apple’s online store and at its physical retail locations. Apple accounts are typically tied to a user’s credit or debit card.
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The iPhone maker wouldn’t be the first company to push hardware subscriptions. Peloton Interactive Inc. recently started testing a subscription service that lets consumers lease bikes and fitness content for between $US60 and $US100 per month. Google also has tried a similar approach with its Chromebook laptops, targeting corporate customers.
And Apple has offered several instalment programs in the past to split up the cost of devices, though not with a subscription model.
In 2015, the company launched the iPhone Upgrade Program, financed through Citizens One Personal Loans, that let users spread the cost of an iPhone over 24 months and upgrade to a new model every 12 months. It also lets Apple Card users divide the cost of an iPhone or Apple Watch over 24 months or an iPad or Mac over 12 months. Wireless carriers offer several monthly instalment programs as well.
The new approach could make existing services less appealing. A subscription program tied to an Apple account would likely be simpler to manage than a carrier program or even the instalment plans for the Apple Card.
Bloomberg
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