Apple’s New Subscription Model

It might cost you more than just buying the iPhone

Photo by Michał Kubalczyk on Unsplash

We all know them, subscriptions on a monthly and even yearly basis. Most of us have subscriptions to software or streaming services, such as Netflix, Spotify, etc. But what’s becoming extremely popular (at least on the side of the seller) is providing a subscription on hardware.

Check for example Link & Co’s newest subscription model where you can get a car in exchange for a monthly fee.

And Apple is likely to jump on this same bandwagon. They already push the Apple TV+, the Apple Arcade, and Apple Music subscription models like crazy.

And now they’re most likely constructing a hardware subscription model. Apple didn’t confirm anything yet. But according to Mark Gurman, a reporter working for Bloomberg is Apple most likely working on a subscription service, not only for the iPhone but for other devices as well.

Do we really need a hardware subscription model?

This is all nice and nice, but do we really need a hardware subscription model? And if we do take one, is it financially beneficial? Or can you just better buy a new iPhone and possess it for four or five years?

Let’s do some math.

A new iPhone Pro starts at $999 in the US. Typically, the lifespan of an iPhone is about five years. After that, you can sell your iPhone on eBay for about $200. So if everything goes well, you’ll end up spending around $799 on that new iPhone.

If we divide this amount by 60 months, we end up paying $13.30 a month for that iPhone Pro.

As long as Apple does not intend to charge this amount for its hardware subscription model, you will end up cheaper buying that new iPhone.

As long as Apple does not intend to charge this amount for its hardware subscription model, you will end up cheaper buying that new iPhone.

Also, be aware that this subscription model doesn’t mean that the amount of the iPhone will be split up across a period of time (12 or 24 months). Most likely, you will need to give the iPhone back once you end up with the subscription.

A subscription model may offer more, though

We all know that when you have a subscription model, most of the time, you get some extra services from the seller. Think of getting free repairs, or even swapping your current hardware for a new one.

Will that be the case with this allegedly Apple subscription model? As of yet, nothing on this is confirmed. Most likely, you will be able to bring your iPhone to the Genius bar if something weird is happening with your iPhone, but isn’t that already the case.

In most cases, if you’re the owner of a brand-new iPhone, purchased at an Apple Store, you can make an appointment at the Genius bar and let them look at whatever is wrong with that iPhone.

I mean, you shouldn’t expect to get a new iPhone if you’ve cracked your screen, but in most cases, you get the service you expect to get when buying a new device.

For some, it can be an interesting offer

In some cases, having the option of paying for hardware on a monthly basis can be an interesting idea. Think of those design agencies that require maxed-out Mac Studios with XDR displays. Buying a couple of those, and you don’t have any liquid assets to keep your business up and running.

Having the option to get your hands on this ultra-expensive hardware can be the difference between starting a business or not.

My take

By now, you probably have noticed that I’m not the biggest fan of subscription models. I mean, yeah, I could be totally wrong and Apple will give us a budget-friendly subscription model.

But I doubt it.

The only moment where hard subscription models are appealing is when the hardware is extremely expensive, and you need to own it to do something meaningful with it. Such as starting a business or purchasing one for work. In any other case, you’re better off skipping on it.

Thanks for reading until the end : )

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