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Apple may soon start selling iPhones through lease-like monthly subscriptions

By Saima Siddiqui 
Updated Date

New Delhi: Cupertino-based tech-giant, Apple, is reportedly working on a new subscription service through which it will sell the iPhone and other hardware products in what could be the company’s biggest push in subscription-driven services like Apple Music, Apple TV+, Apple Arcade, iCloud+, and more.

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Simply, Apple is looking to venture into hardware subscriptions where customers will pay a monthly app fee to own their device instead of buying them through the conventional method. As per reports Apple’s hardware subscription service for iPhone and other hardware products, is still in development, but chances are that Apple will launch it as early as later this year.

For Apple, subscriptions contribute heavily to Apple’s overall revenue and have been available on Apple’s software services, such as Apple Music, iCloud, Apple TV Plus, Apple Fitness Plus, and Apple Arcade. Apple also offers the Apple One bundle that comprises subscriptions of some of its software services into a single subscription for a monthly fee. And just like its software services, the iPhone is likely to be tied to the Apple One subscription bundle.

However, the monthly fee for hardware subscriptions reportedly would not be the equivalent of instalments where you pay, say, the iPhone’s full price in 12 or 24 months. The subscription for the iPhone, instead, would involve the option to upgrade to new hardware as it is released for an amount that is not clear yet. In simple words, Apple would charge you a fee that will include a part of the cost of the iPhone as well as a fee that would let you upgrade to a new iPhone next year without having to pay the full amount. Apple could also bundle its software services into the iPhone subscription.

The cheapest option is $35.33 per month for the iPhone 13 Mini (roughy Rs 2,700) and goes up to $74.91 for the top-spec iPhone 13 Pro Max (roughly Rs 5,700). The report says that if the new subscription model is launched, it will come as the biggest push yet into automatically recurring sales, allowing users to subscribe to hardware products for the first time. This is what the report said could be the nature of the subscription, though nothing has officially been confirmed yet.

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The iPhone-based subscription service is likely to be tied to a user’s Apple ID account, just like other subscriptions. That could possibly also include AppleCare or Apple One services just so the user would not have to pay for them separately.

Apple currently allows customers in select markets to finance the purchase of hardware products through an Apple Card. There is also the iPhone Upgrade Program through which customers, again, in select countries, can get a new iPhone every year without having to pay any additional costs. It also has subscriptions for AppleCare extended warranties. These might as well be considered hardware subscriptions, but Apple’s new subscription would not just simply be an EMI option.

The subscription service, according to reports, will be launched by the end of 2022, but it could be delayed to 2023. The report also quoted its sources as saying that the subscription model could even end up being cancelled.

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