It is revealed that Apple is planning to launch a hardware subscription service: monthly iPhone/iPad rentals and optionally replaceable cell phones.
Apple is developing a subscription service for iPhones and other hardware products, Bloomberg reported, citing people familiar with the matter, in a move that could make device ownership akin to paying a monthly fee for an app. Users pay a monthly fee and can use iPhone and iPad hardware directly. Apple plans to roll out the new service starting with this year’s new iPhones.
Currently, any Apple hardware product allows users to pay in installments using the Apple Card platform. Apple also launched the iPhone annual renewal service, and users who join the service can use the latest iPhone every year.
Apple’s hardware subscription service is under study and may be linked to Apple One and Apple Care services. Paying a fixed monthly fee, you can use the latest iPhone, iPad, and enjoy Apple One services, including more iCloud disk space. In the future, services such as Apple Music and AppleTV+ may also join in.
Pushing hardware subscriptions (similar to car rental programs) would be a major strategic shift for a company that typically sells products outright in full. Apple sometimes sells products by accepting installments or carrier subsidies. That could help Apple generate more revenue and make it easier for consumers to accept the cost of new products.
The iPhone is already Apple’s largest source of sales, generating nearly $192 billion in revenue last year, accounting for more than half of the company’s revenue.
The Apple spokesperson declined to comment.
The idea is to make buying an iPhone or iPad consistent with paying monthly for iCloud storage or an Apple Music subscription. Apple plans to let customers subscribe to hardware using the same Apple ID and App Store account they used to buy apps and services today.
This plan differs from the installment plan in that the monthly charge is not divided into 12 or 24 months of the product price. Rather, it’s an as-yet-undetermined monthly fee and depends on which device the user chooses.
The subscription service is expected to launch by the end of 2022, but could be delayed until 2023 or eventually canceled, the people said.