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Business

Apple reportedly working on iPhone hardware subscription service

25 Mar, 2022 02:54 AM3 minutes to read
The technology powerhouse is believed to be planning to introduce a hardware subscription model across its iPhones and other devices. Photo / AP

The technology powerhouse is believed to be planning to introduce a hardware subscription model across its iPhones and other devices. Photo / AP

news.com.au
By Stefanie Costi

Apple is reportedly planning to unveil a subscription service for its iPhones and other devices – a shift that will make owning an iPhone or iPad like paying for a monthly music subscription.

"People with knowledge of the matter" told Bloomberg that the project – which is still being refined – will enable Apple users to subscribe to hardware instead of just digital services. The sources declined to be identified as the service is still under wraps.

A spokesman for Apple declined to comment and called the report "speculative".

Under the tech giant's new scheme, it would move from selling devices at a full cost outright or through monthly plans with various carriers, to implementing a hardware subscription service similar to a car leasing programme.

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The rationale behind the service is to make the purchase of new hardware akin to paying for iCloud storage. Consumers can subscribe to devices with the same information that they use to purchase apps, and potentially trade in their hardware for newer models when they are released.

Seen on the screen of a device in La Habra, California, new iPhone 13 smartphones are introduced during a virtual event held to announce new Apple products last year. Photo / AP
Seen on the screen of a device in La Habra, California, new iPhone 13 smartphones are introduced during a virtual event held to announce new Apple products last year. Photo / AP

The programme would differ to a normal mobile phone plan in that it would not be the price of the hardware split across 12, 24 or 36 months. Instead, it would be a monthly fee (not determined as at the time of publication) based on the hardware the Apple user chooses.

There is no denying the programme could help Apple obtain more revenue and make it easier for users to deal with spending a lot of cash on new hardware. In 2021, the iPhone was the biggest revenue raiser for Apple bringing in a total of nearly US$192 billion ($NZ275b).

According to Bloomberg, the new hardware subscription service is expected to launch by the end of 2022 or in 2023 but could be cancelled completely.

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Apple is not the first organisation to adopt a hardware subscription model. Google also tried out a similar tactic with corporate users of its Chromebook laptops and, in recent times, Peloton Interactive Inc tested out a subscription model that allows its customers to lease bikes and fitness content for between $US60 and $US100 per month.

When contacted by news.com.au, a spokesman for Apple said the hardware subscription model was "speculative so Apple does not have any comment to share".

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